Supplementary resources by topic. Profit is one of 51 key economics concepts identified by the Council for Economic Education (CEE) for high school classes.

Profit

On this page:

Definitions and Basics
In the News and Examples
A Little History: Primary Sources and References
Advanced Resources
Related Topics

Definitions and Basics

Profits, from the Concise Encyclopedia of Economics

Capitalists earn a return on their efforts by providing three productive inputs. First, they are willing to delay their own personal gratification. Instead of consuming all of their resources today, they save some of today’s income and invest those savings in activities (plant and equipment) that will yield goods and services in the future….

Second, some profits are a return to those who take risks. Some investments make a profit and return what was invested plus a profit, but others don’t.

Third, some profits are a return to organizational ability, enterprise, and entrepreneurial energy.

In the News and Examples

A Little History: Primary Sources and References

Who wins with tribal casinos? The incentive to claim a stake in the profits: Indian Givers: Politicians and Tribal Gambling Casinos, by Fred S. McChesney. Econlib, February 6, 2006.

How did the federal government get involved with Indian casinos? Almost two centuries ago, the Supreme Court defined Indian tribes as “sovereign nations,” independent of the United States and individual states in many respects. But Indian tribal sovereignty vis-à-vis non-Indian governments is an extraordinarily complicated affair. As concerns gambling, states are free to prohibit gambling within their borders, in which case Indian tribes are bound by state law (despite their “sovereignty”). In states banning gambling, such as Utah, there can be no Indian gambling casinos, either….

Although taxing Indian tribes was of little interest in Washington when the tribes and their members had little income—the IRS initially opined that Congress did not designate Indian tribes as taxable entities—the rise of casinos has changed all that….

Advanced Resources

Related Topics

Competition and Market Structures

Producers

Entrepreneurs

Productive Resources

Saving and Investing