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[quote user="CSSHEGEWISCH"] [quote user="Sam1"]   Contrary to what many Americans appear to believe, a business does not exist to provide employment. It's purposes are to achieve a variety of goals for its key stakeholders, i.e. shareholders, customers, employees, creditors, regulators, etc.  At the end of the day the primary purpose of a business is to sell goods and/or services at prices that will cover their costs and provide a reasonable return to the owners.  [/quote] And what constitutes a reasonable return to the owners? [/quote] Answering your question would be grist for semester long courses at the nation's best business schools. In a nutshell it depends on the expectations and risk tolerances of the investors. Investors in utility companies, as an example, probably are happy with a return of 8 to 11 per cent, but those in a high risk activity, such as oil and gas exploration, probably have considerably higher expectations because they are willing to tolerate a much higher risk levels.  Investors in the nation's freight railroads, including the Canadian National and CPR, are getting a return in the neighborhood of 11 to 13 per cent. These returns appear to be more than sufficient to attract investor and creditor capital.  The optimum determinate of reasonable is the market. I shudder at the thought that the returns would be dictated by a government authority.  Been there, done that.  Prior to deregulation of the utilities in Texas, the returns were determine to a large extent by a rate order issued by the Public Utility Commission. It was a largely ugly political exercise.
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