profit the main goal of business?

Profit making is the primary motive of the business. Profit plays a key role in the private enterprise system in terms of:
- Motivating the owners.
- Profit is the remuneration of the businessman.
- Profit is the livelihood of the businessman.
- Encouraging innovation.
- Encouraging efficiency.
- Increasing profit increases the goodwill of the business.
- Signaling areas for expansion. Profit is necessary for the expansion and development of the business.

- Providing the finance for expansion.
- Providing a measuring rod of performance. It is measure of the success of the business.
• Business is an activity that is directed to create values for removing wants of man in society through recurring exchange.
• Profits come from the efficient production of goods and services demanded by people.



Profit as a goal

• Profit is the reward for taking risks involved in investing money and time. It is the reward for innovation.
• Adam Smith in his book “The Wealth of Nation” (1776) argued, “People do their best when they reap the rewards of hard work and intelligence and suffer the penalties for laziness”.
• He favored the use of profits as a means of encouraging individual incentive and initiative.

There are three elements of business
• Business reveals  that it has several  important elements, namely:
• Recurring exchanges. Recurring sale constitute business. If goods is purchased or produced fro sale, it is a business activity.
• Creation of values or utility.  Form place, time and ownership utilities.
• Satisfaction of wants. People have many physiological and mental needs.
• If you buy a flat for your own living is not a business activity.