Loss - Revision history

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	[[Action]] attempts to exchange a less desirable condition for a more desirable one, and [[cost]]s are incurred to achieve a goal. Sometimes, action does not achieve its end. If it has produced a less desirable state of affairs, the difference between the valuation of the result and the costs incurred is called '''[[loss]]'''.<ref name="Mises_profit">Ludwig von Mises. [https://~~mises.~~freecapitalists.org/~~humanaction~~/~~chap4sec4.asp~~ "4. Action as an Exchange"], ''[[Human Action]]'', online edition, Chapter IV. A first analysis of the category of Action, [[Mises Institute]]. Referenced 2009-05-14}.</ref>		[[Action]] attempts to exchange a less desirable condition for a more desirable one, and [[cost]]s are incurred to achieve a goal. Sometimes, action does not achieve its end. If it has produced a less desirable state of affairs, the difference between the valuation of the result and the costs incurred is called '''[[loss]]'''.<ref name="Mises_profit">Ludwig von Mises. [https://freecapitalists.org/books/human-action/read/chapter-iv-a-first-analysis-of-the-category-of-action/ "4. Action as an Exchange"], ''[[Human Action]]'', online edition, Chapter IV. A first analysis of the category of Action, [[Mises Institute]]. Referenced 2009-05-14}.</ref>

	==Profit and Loss of the Enterpreneur==		==Profit and Loss of the Enterpreneur==

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	[[Action]] attempts to exchange a less desirable condition for a more desirable one, and [[cost]]s are incurred to achieve a goal. Sometimes, action does not achieve its end. If it has produced a less desirable state of affairs, the difference between the valuation of the result and the costs incurred is called '''[[loss]]'''.<ref name="Mises_profit">Ludwig von Mises. [~~http~~://mises.org/humanaction/chap4sec4.asp "4. Action as an Exchange"], ''[[Human Action]]'', online edition, Chapter IV. A first analysis of the category of Action, [[Mises Institute]]. Referenced 2009-05-14}.</ref>		[[Action]] attempts to exchange a less desirable condition for a more desirable one, and [[cost]]s are incurred to achieve a goal. Sometimes, action does not achieve its end. If it has produced a less desirable state of affairs, the difference between the valuation of the result and the costs incurred is called '''[[loss]]'''.<ref name="Mises_profit">Ludwig von Mises. [https://mises.freecapitalists.org/humanaction/chap4sec4.asp "4. Action as an Exchange"], ''[[Human Action]]'', online edition, Chapter IV. A first analysis of the category of Action, [[Mises Institute]]. Referenced 2009-05-14}.</ref>

	==Profit and Loss of the Enterpreneur==		==Profit and Loss of the Enterpreneur==
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	On the other hand, the entrepreneur who misjudges the future prices of the products allows for the factors of production prices which, seen from the point of view of the future state of the market, are too high. His total costs of production exceed the prices at which he can sell the product. This difference is '''entrepreneurial loss'''.		On the other hand, the entrepreneur who misjudges the future prices of the products allows for the factors of production prices which, seen from the point of view of the future state of the market, are too high. His total costs of production exceed the prices at which he can sell the product. This difference is '''entrepreneurial loss'''.

	Thus profit and loss are generated by success or failure in adjusting the course of production activities to the most urgent demand of the consumers. Once this adjustment is achieved, they disappear. The prices of the complementary factors of production reach a height at which total costs of production coincide with the price of the product. Profit and loss are ever-present features only on account of the fact that ceaseless change in the economic data makes again and again new discrepancies, and consequently the need for new adjustments originate.<ref name="Mises_profit_loss">Ludwig von Mises. [~~http~~://mises.org/daily/2321 "Profit and Loss"], Mises Daily October 2006, originally prepared for the meeting of the Mont Pèlerin Society in September 1951. Referenced 2010-05-26.</ref>		Thus profit and loss are generated by success or failure in adjusting the course of production activities to the most urgent demand of the consumers. Once this adjustment is achieved, they disappear. The prices of the complementary factors of production reach a height at which total costs of production coincide with the price of the product. Profit and loss are ever-present features only on account of the fact that ceaseless change in the economic data makes again and again new discrepancies, and consequently the need for new adjustments originate.<ref name="Mises_profit_loss">Ludwig von Mises. [https://mises.freecapitalists.org/daily/2321 "Profit and Loss"], Mises Daily October 2006, originally prepared for the meeting of the Mont Pèlerin Society in September 1951. Referenced 2010-05-26.</ref>

	==References==		==References==
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	==Links==		==Links==
	* [~~http~~://mises.org/daily/1644 Profit, Loss, and Pluto] by Robert P. Murphy , October 2004		* [https://mises.freecapitalists.org/daily/1644 Profit, Loss, and Pluto] by Robert P. Murphy , October 2004
	[[Category:Economic concepts]]		[[Category:Economic concepts]]

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	==~~External links~~==		==Links==
	* [http://mises.org/daily/1644 Profit, Loss, and Pluto] by Robert P. Murphy , October 2004		* [http://mises.org/daily/1644 Profit, Loss, and Pluto] by Robert P. Murphy , October 2004
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	==External links==		==External links==
	* [http://mises.org/daily/1644 Profit, Loss, and Pluto] by Robert P. Murphy , October 2004		* [http://mises.org/daily/1644 Profit, Loss, and Pluto] by Robert P. Murphy , October 2004
	[[Category:~~Economical Concepts~~]]		[[Category:Economic concepts]]

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	==External links==		==External links==
	* [http://mises.org/daily/1644 Profit, Loss, and Pluto] by Robert P. Murphy , October 2004		* [http://mises.org/daily/1644 Profit, Loss, and Pluto] by Robert P. Murphy , October 2004
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	[[Action]] attempts to exchange a less desirable condition for a more desirable one, and [[~~costs~~]] are incurred to achieve a goal. Sometimes, action does not achieve its end. If it has produced a less desirable state of affairs, the difference between the valuation of the result and the costs incurred is called '''[[loss]]'''.<ref name="Mises_profit">Ludwig von Mises. [http://mises.org/humanaction/chap4sec4.asp "4. Action as an Exchange"], ''[[Human Action]]'', online edition, Chapter IV. A first analysis of the category of Action, [[Mises Institute]]. Referenced 2009-05-14}.</ref>		[[Action]] attempts to exchange a less desirable condition for a more desirable one, and [[cost]]s are incurred to achieve a goal. Sometimes, action does not achieve its end. If it has produced a less desirable state of affairs, the difference between the valuation of the result and the costs incurred is called '''[[loss]]'''.<ref name="Mises_profit">Ludwig von Mises. [http://mises.org/humanaction/chap4sec4.asp "4. Action as an Exchange"], ''[[Human Action]]'', online edition, Chapter IV. A first analysis of the category of Action, [[Mises Institute]]. Referenced 2009-05-14}.</ref>

	==Profit and Loss of the Enterpreneur==		==Profit and Loss of the Enterpreneur==

Pestergaines: Created initial page for Loss.

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[[Action]] attempts to exchange a less desirable condition for a more desirable one, and [[costs]] are incurred to achieve a goal. Sometimes, action does not achieve its end. If it has produced a less desirable state of affairs, the difference between the valuation of the result and the costs incurred is called '''[[loss]]'''.<ref name="Mises_profit">Ludwig von Mises. [http://mises.org/humanaction/chap4sec4.asp "4. Action as an Exchange"], ''[[Human Action]]'', online edition, Chapter IV. A first analysis of the category of Action, [[Mises Institute]]. Referenced 2009-05-14}.</ref>

==Profit and Loss of the Enterpreneur==
If all people were to anticipate correctly the future state of the market, the [[entrepreneur]]s would neither earn any profits nor suffer any losses. They would have to buy the complementary factors of [[production]] at prices which would, already at the instant of the purchase, fully reflect the future prices of the products. No room would be left either for profit or for loss. What makes profit emerge is the fact that the entrepreneur who judges the future prices of the products more correctly than other people do buys some or all of the factors of production at prices which, seen from the point of view of the future state of the market, are too low. Thus the total costs of production — including interest on the capital invested — lag behind the prices which the entrepreneur receives for the product. This difference is '''entrepreneurial [[profit]]'''.

On the other hand, the entrepreneur who misjudges the future prices of the products allows for the factors of production prices which, seen from the point of view of the future state of the market, are too high. His total costs of production exceed the prices at which he can sell the product. This difference is '''entrepreneurial loss'''.

Thus profit and loss are generated by success or failure in adjusting the course of production activities to the most urgent demand of the consumers. Once this adjustment is achieved, they disappear. The prices of the complementary factors of production reach a height at which total costs of production coincide with the price of the product. Profit and loss are ever-present features only on account of the fact that ceaseless change in the economic data makes again and again new discrepancies, and consequently the need for new adjustments originate.<ref name="Mises_profit_loss">Ludwig von Mises. [http://mises.org/daily/2321 "Profit and Loss"], Mises Daily October 2006, originally prepared for the meeting of the Mont Pèlerin Society in September 1951. Referenced 2010-05-26.</ref>

==References==
{{Reflist}}

==External links==
* [http://mises.org/daily/1644 Profit, Loss, and Pluto] by Robert P. Murphy , October 2004