What is the difference between products that are made for profit and products that are made to benefit others?
Profit is equal to the revenue of a company minus expenses. Products made for profit enable firms to invest more in research and development, which will lead to better products in the long term, to the benefit of consumers. Secondly, having products that have high profit is good for shareholders who will gain more dividends. Having a product that makes profit is for personal gain. In other words to benefit from that product is to gain wealth, simply from profit. Meanwhile, non-profit products that are are made to benefit others exist to fulfil an owner's organizational goals. There's no personal gain or profit made in these products. Non-profit's seek donations from individuals or corporations in order to reach there long term goal. For example, if their goal is to create a affordable medical device that could save the lives of at-risk babies, products would be sold at a margin, and any "profit"' would be reinvested back into the company to fulfil the companies long term goal: to create a line of affordable medical devices that could save the lives of millions of at-risk babies.
Research the pros/cons of developing a product that is made for profit vs a product that is made to benefit others. Provide an example of each type of product.
Benefits of a developed product that is made for profit is tax revenue. Higher company profits will lead to an increase in corporate tax revenues. This allows the government to spend more on public services, such as health care, education and welfare payments. Consequently, the general taxpayer benefits indirectly from an increase in company profits. Secondly, incentive effects are another reason why profit is good. Profit is an important incentive to encourage people to invest, to innovate and to take risks. Increased profitability will encourage more entrepreneurs to take risks and invest. This can lead to increased economic opportunities, new employment and increased growth. Not mention investment will lead to research and development, which will lead to better products in the long term, to the benefit of consumers. For example, drugs companies need to make high profit to enable the development of new drugs which will benefit the public. One of the major disadvantages of a profit-making business is that it must pay taxes on its profits. Profit-making businesses must make tough decisions such as whether to reinvest earnings in further growth or to distribute it to shareholders through dividend payments. For example, Gamestop a profitable company, is short selling, investors can borrow shares of stock to sell and then buy back later so they can return them, which lets them pocket the profit if the stock price goes down. However if huge shareholders abandon their position then the stock will go up. Which is good for ordinary people to invest in but not the wealthy people on wall street.
Non-profit organizations are generally in the process of providing funding or services not normally available from other sources to the people they serve. As they do not intend to make a profit, non-profits usually have significant tax advantages over profit-making businesses. Opportunities for grant funding and lower costs for such things as postal service charges are also advantages. Advantage example for a non profit organization is no being taxed on their product. Nonprofits sometimes sell products or services to generate revenue, but often rely heavily on fundraising and private donations to provide services and resources. Raising funds is an ongoing challenge that is particularly difficult when the economy is poor. Nonprofits usually have to report how their funds are used. Nonprofits often have a tough marketing battle as they must motivate people to donate or volunteer when they are unlikely to receive tangible benefits in return. For example, a non profit animal shelter would need to spend a lot of time to convince and show people why they should donate to there organization since they're not receiving any benefit. This can slow down the time it takes for the organization to reach there long term goal: to feed the animals, buy medication for them, and find them a proper home.
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