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- The rate of profit is defined as ratio of profits, the difference between total revenues and total costs, to the capital advanced for production. Theories differ in terms of how both profits and capital are defined. The profit rate is also defined on the aggregate or economy-wide level, the industry level, and the firm level.
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Rate of profit. In economics and finance, the profit rate is the relative profitability of an investment project, a capitalist enterprise or a whole capitalist economy. It is similar to the concept of rate of return on investment.
Marxian critique ofpolitical economy. The tendency of the rate of profit to fall ( TRPF) is a theory in the crisis theory of political economy, according to which the rate of profit —the ratio of the profit to the amount of invested capital —decreases over time.
In economics, profit is the difference between revenue that an economic entity has received from its outputs and total costs of its inputs, also known as surplus value. It is equal to total revenue minus total cost, including both explicit and implicit costs.
Mar 22, 2024 · Published Mar 22, 2024. Definition of Rate of Profit. The rate of profit, in economic terms, refers to the ratio of profits earned (net income) to the capital invested. It is a measure of the efficiency and effectiveness with which a company or an investor uses capital to generate earnings.
BIBLIOGRAPHY. The rate of profit is defined as ratio of profits, the difference between total revenues and total costs, to the capital advanced for production. Theories differ in terms of how both profits and capital are defined. The profit rate is also defined on the aggregate or economy-wide level, the industry level, and the firm level.
Aug 20, 2016 · First published online August 20, 2016. Market power and the rate of profit. Michael Webber View all authors and affiliations. Volume 48, Issue 12. https://doi.org/10.1177/0308518X16664090. Contents. Get access. More. Get full access to this article. View all access and purchase options for this article. Get Access. References.
This study presents new computations of profit rates using a definition like that used by Marx in Volume III of Capital, where profits correspond to total surplus-value, as well as a definition of the rate of profit that impacts individual firms, taking account of interest, taxes, and inventories.
