Profits 12/12

-> Profits = Total Revenues - Total Costs (Explicit and Implicit)

-> Contracts reduce uncertainty, helping facilitate transaction

-> "Interest" - Price paid to consume today though you haven't earned it yet, and cost for loaner to not have that money over loan period

-> Even if accounting flow brings in positive monetary profits, economic profits may be negative due to implicit and opportunity costs

-> No such thing as guaranteed profits

-> Competition drives prices down and increases worker profits; preventing it does the opposite

-> Losses insulate against waste and curb risk-taking, preventing resource misallocation