It is common practice to determine profit by first calculating cost and then adding a percentage. Increase cost and you increase profit. I don't think they teach this in Econ 101. If you are a Free-Market. Fixed costs, such as government excises, which are imposed on corporate privileges, are merely passed on to the consumer.
Competition plays no role here.
Reduce his cost and competition will reduce his profits. It is common practice to determine profit by first calculating cost and then adding a percentage. Increase cost and you increase profit. I don't think they teach this in Econ 101. Return to the Reason Forum home page How to subscribe to Reason Magazine Return to the Reason Magazine home page Free-Market.