22 lines
942 B
Markdown
22 lines
942 B
Markdown
<!-- generated: provider=openrouter model=arcee-ai/trinity-large-preview:free date=2026-02-19 source=book-1-chapter-09 -->
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# Rate of Profit
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## Definition
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The percentage return on capital investment that determines the income earned by the owner of stock or capital. The rate of profit varies across different trades and locations based on competition, risk, and market conditions, typically being higher in trades with greater risk or less competition.
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## Source Chapter
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Book I, Chapter 9
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## Context
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The chapter examines how the rate of profit, like wages, fluctuates with the economic conditions of society but follows different patterns. Smith discusses how increased stock in a trade lowers profits through competition, how profits are more difficult to measure than wages due to their daily fluctuations, and how the legal interest rate serves as an indicator of the ordinary rate of profit.
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## Economic Domain
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Distribution
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---
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