Like, Company A posts 5 Billion in profits. But if they post 4.9 billion in profits next year it’s a serious failing on the company’s part, so they layoff 20% of their employees to ensure profits. Am I reading this wrong?
In: Economics
1) Inflation is usually a few percent a year. A company serving the same customer base should grow a few percent annually.
2) The population is growing. A company serving the same geographical location, even with no growth, should serve more customers each year.
3) Free markets grow the economy. Because successful businesses prosper financially, there is an incentive to provide better or equal goods and services at a lower price. Overall the “economy,” the total value of goods and services produced, will increase. The value of all companies 300 years ago was much smaller than it is today. There is no end in sight for this trend to continue.
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