Question

All companies have a responsibility to _________ so they can provide a return on investment to their owners and investors, create jobs for the community, and contribute goods and services to the economy.

a) offer the lowest priceb) be profitablec) obey their customersd) provide the largest selection possiblee) pay employees more than minimum wage

Answer 1

Answer: be profitable

Explanation: In simple words, profit refers to the excess revenue that a company is left with after deducting for all direct and indirect expenses. The prime objective of every business entity is to earn appropriate profit so they can return a suitable amount for their investors.

An entity cannot survive in a market if it is not profitable as the funds for the future operations of the entity comes from the profit it makes in the current period.

The management of an entity should price its product in such a way that majority of customer would be able to buy it. Obeying customers is necessary but it is not directly connected with economical aspects of business. The wages of employees do not have any direct impact on return on investors.