Economic Profit From Principal Of Economics (Vol_1)

1 Assignment 2 ASSIGNMENT 2 NAME: Rutba Ali ID # 193349 SUBMITTED TO: Sir Imran Lorem ipsum dolor sit amet, consectetuer adipiscing elit, sed diam nonummy nibh euismod tincidunt ut laoreet dolore magna aliquam erat volutpat. Ut wisi enim ad minim veniam, quis nostrud exerci tation ullamcorper suscipit lobortis nisl ut aliquip ex ea commodo consequat.2 Assignment 2 Question 1 Should a company ever produce an output if the managers know it will lose money over the period? Explain. Answer Importance of Profitable Company: The principle aim for most organizations is to earn a profit. Producing profits in a business surroundings often indicates that a firm is supplying goods or offerings preferred through customers at a reasonable price. An advantageous effect of companys income is the capability for agencies to make bigger and develop their operations. Some Basic advantages of Profit: Profit Allow to grow business Interact investors that increase stock values Non-Profitable Company: The company with loss has different disadvantages such as: Social pressure Reduce of operation It leads to bankrupt3 Assignment 2 According to given scenario: If a manager knows that a product will leads to loss, company should not produce that product. Mostly if a company is