the _entrepreneur_ cannot have any
of the amount _B'C'D'_ left in his hands after meeting the claims that
the wage earner makes on him. On the other hand, he must have enough
left to pay interest, since otherwise he would be incurring a loss,
and that could not fail to force him and others who are in the same
situation to contract their operations or go out of business. If the
output of goods is reduced, either by the retirement of some employers
or the curtailment of product by all, the price of what continues to
be sold will be raised to the point at which wages and interest can be
paid.

_Wages and Interest both adjusted at Social Margins of
Production._--It is to be noted that wages and interest are fixed at
the social margin of production, which means that they equal what
labor and capital respectively can produce by adding themselves to the
forces already at work in the general field of employment. In making
the supposition that, owing to some disturbing fact, a particular
_entrepreneur_ has not enough after paying wages to pay interest, we
assume that the rate of interest is fixed, in this way, in the general
field and not merely in his establishment.

If _B'C'D'_ were larger than _ABDE_, the _entrepreneur_ would be
selling goods for more than cost and realizing a net profit, which he
cannot do in a static state; but a pure profit is not only possible
but actual in a dynamic state.

In actual business total returns represented by _ACDE_ amount to more
than the sum represented by _ABDE_ (wages) plus _A'B'D'E'_ (interest).
There are conditions that in practical life are continually bringing
this to pass in different lines of business, though not in all of them
at once. The real world is dynamic and therefore the true net profit,
or the share of the _entrepreneur_ in the strict sense of the term, is
a positive quantity. This income is always determined residually. It
is a remainder and nothing else. It is what is left when wages and
interest are paid out of the general product. To the _entrepreneur_
comes the price of the products that an industry creates. Out of this
he pays wages and interest, and very often he has something remaining.
There is no way of determining this profit except as a remainder. The
return from the sale of the product is a positive amount fixed by the
final utility principle. Wages and interest are positive amounts, and
each of them is fixed by the final productivity principle. The
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