Profits and Losses

The terms ‘profits’ and ‘losses’ are common parts of the business vernacular.  However, many people don’t fully understand their role in a market economy.  This has become even more pronounced after the recent financial crisis.  To date, the government has attempted to perpetuate a system of profits without losses.  The problem with trying to build a market economy without both profits and losses is that it will inevitably lead to one of two extremely undesirable results.

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