If the Value Added of a Firm Is Positive,will the Firm

question 177

Essay

If the value added of a firm is positive,will the firm necessarily have positive profits?

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Definitions:

Government

An organized system that establishes and enforces rules and institutions to govern a community, region, or country.

Firms

Business entities that produce goods or provide services to consumers, aiming to maximize profits.

Pigouvian Taxes

Taxes imposed on any market activity that generates negative externalities (costs not reflected in the market price) to correct the market outcome.

External Costs

Costs that are not borne by the producers or users of a product or service, but by society or the environment.