204k views
1 vote
A company's profit years after 2000 is modelled by ____________

User Glaslos
by
7.6k points

1 Answer

5 votes

Final answer:

Corporate profits after tax, adjusted for inventory and capital consumption, have generally increased each year since 2000, with a notable dip during the 2008 financial crisis. Profits for S&P 500 companies grew by 9.7% between the end of the 2009 recession and the second quarter of 2013, mainly due to cost cutting and input cost reductions.

Step-by-step explanation:

The question pertains to how a company's profit years after 2000 can be modelled. According to the Federal Reserve Economic Data (FRED), corporate profits after tax (adjusted for inventory and capital consumption) have exhibited a trend of increase each year since 2000, with a few exceptions, notably during 2008 and into 2009 when there was a significant drop in profits. Post-2009, and particularly between the end of the recession in 2009 and the second quarter of 2013, the profits for the S&P 500 companies grew by 9.7%. This growth occurred despite a weak economy and was primarily attributed to cost cutting and reductions in input costs, as reported by the Wall Street Journal. The profit trend has been upward, although the rate of increase has been less steady or consistent over the years.

User Jenya Kirmiza
by
8.0k points