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Zero profit |
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Zero profitA situation in which profit in an industry is zero, usually as a result of free entry and exit. It may, if firms are not identical, refer only to the marginal firm. And it always means zero excess profit, not that all returns to capital invested in the industry are zero.Similar MatchesProfit maximizingProfit maximizingThe level of a variable or behavior that maximizes the profit of a firm. Pre tax profitPre tax profitSee: 'profit before tax'. Profit marginProfit marginOperating profit as a percentage of sales (or turnover). To calculate profit margin, multiply operating profit by 100, and divide the result by turnover.Example: Company X made an operating profit of £500m on a turnover of £3,000m. Profit margin was therefore (500 x 100) / 3000= 16.66%Profit margin tells you about the underlying profitability of a company's trading activities, not whether it is actually making money for shareholders. Note that it is calculated before taking account of interest charges or tax. Net profit after taxNet profit after taxThe net profits of a company after taxation. This is the 'bottom line' that you often hear about. Dividends are paid out of net profits after tax, and the amount that isn't paid out is the retained profit. Excess profitExcess profitProfit of a firm over and above what provides its owners with a normal (market equilibrium) return to capital. Further SuggestionsExcess profits taxprofit before tax Gross profit gross profit Profit Table Risk adjusted profitability Profit margin Profit Range Profit Graph Gross profit margin Profitability ratios unitised with profits Non profit endowment profits warning Windfall profit Profitability index Realized profit (or loss) Pretax earnings or profits Unitised with profit endowment Directly Unproductive Profit-Seeking Activities net profit before tax (pre tax profit) net profit Profit taking paper profit Profit shifting |
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