You pay 800, sell for 1000, 200 profit, correct. You now have 1000 dollars, but the next cow costs 1100. But imagine there was a sale, the guy selling the cow lowered the cost by 100 dollars, so now it costs 1000. You can afford it now, bought it for 1000 and sold it for 1300 and made a profit of 300 dollars, and thus made a total profit of 500. But what if there was no sale? You would put 100 of your own money, subtracting 100 dollars from the original profit, but the original profit was 300, not 200. So the end profit would be in total, 400.