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Profit Motive

The profit motive refers to the idea that businesses are motivated to earn profits. Profits are the excess of revenue over costs, and businesses aim to maximize profits by selling goods and services at prices that are higher than their costs of production.

The profit motive is a driving force in capitalist economies, as businesses compete with each other to attract customers and earn profits. The pursuit of profits can lead businesses to innovate and create new products and services, as well as to find more efficient ways of producing and distributing goods and services.

The profit motive can also have negative consequences, as businesses may prioritize profits over other values such as ethical behavior, environmental sustainability, and social responsibility. This can lead to conflicts of interest and negative impacts on society and the environment.

The profit motive is often contrasted with other motivations such as the social welfare motive, which refers to the idea that businesses should prioritize the well-being of society over profits, and the public interest motive, which refers to the idea that businesses should prioritize the common good over profits.

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