Profit

Meaning of Profit

Profit is the reward of the organiser as rent is the reward of the landlord. The entrepreneur organizes business, takes responsibility of decisions and the risks rising there from. He is the leader, not necessarily the owner of capital invested; he is the innovator, not the inventor; he is the organiser, For organising   and directing business, the entrepreneur gets a reward. This reward is known as profit.

Definitions        

According to J.B. Clark, “Profit is the difference between price and cost of production of the commodity.”

According to Ulmer, “Profit may be defined as the difference between firm’s total revenue and its total costs.”

From the above discussion, we can define profit as “the remuneration of the entrepreneur for his unique services rendered in the production process.”