Final answer:
If you sell your house for more than the purchase price, you've made a profit. This financial gain from selling a property higher than its purchase cost is known as a capital gain. Such profits exemplify the financial returns from investments in real estate.
Step-by-step explanation:
If you sell your house for more money than you bought it for, you have made a profit. This is because a profit occurs when the selling price of an asset exceeds its purchase price. For example, if Freda bought a house for $150,000 and sells it for $250,000, she has made a profit of $100,000. In another case, Ben initially bought his house for $100,000 and has paid off $20,000 of his bank loan. If the house's value has now increased to $160,000, he also stands to make a profit should he decide to sell. Investment in a house is a mix of financial and non-financial returns, including potential capital gains from future sale.