1. In any market systems, the role played by economic profits is crucial in assisting resource owner to make optimal decisions. Not only the existence of profits, but the level of these profits will determine the type and quantity of goods and services that will be produced and sold, which in turn influence the resulting derived demand for resources. There are several theories of profit which can explain how this happens.

You are required to select any successful profit-making organization and determine reasons for the existence of profits in that organization.