Quote:
Originally Posted by iggy_oi
Which scenario earns you more money, making a smaller profit or no profit at all?
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You need to keep in mind that capital (ie the money that would be used for expansion in this scenario) competes with all types of returns.
If my options are take risk (and as you say above, expansions don't all go flawlessly) to make a smaller profit, I can decide instead to put that money to work in the stock market, real estate, foreign countries etc. I am not forced to choose to expand and destroy capital despite the Govt's invention of a new tax.