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Why do many people believe profits on sales of finished goods are much higher than they actually are?

This is a poorly formed question.

"many people" is an undefined term. What do you mean by "many"? 50% of the people? 20 million people? 6 students in a classroom?

Also, this is more of a psychological question than a business question.

Psychology is the study of mental process and behavior. You would consult a psychologist as to why people believe certain things.

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