NCERT Chapter Summary: Business, Trade and Commerce

In every society, people undertake various activities to satisfy their needs. These activities may be broadly classified into two groups - economic and non-economic.

Economic activities are those by which we can earn our livelihood, whereas, non-economic activities involve the production and sale of goods and services undertaken with a motive of earning profit by satisfying human needs in society.

Characteristics of Business Activities: (i) An economic activity (ii) Production or procurement of goods and services (iii) Sale or exchange of goods and services (iv) Dealings in goods and services on a regular basis (v) Profit earning (vi) Uncertainty of return (vii) Element of risk.

Industry refers to economic activities, which are connected with conversion of resources into useful goods. Commerce includes two types of activities: (i) trade and (ii) auxiliaries to trade.

Trade is an essential part of commerce. It refers to sale, transfer or exchange of goods. Activities which are meant for assisting trade are known as auxiliaries to trade.

Auxiliaries to trade: (i) Transport and Communication (ii) Banking and Finance (iii) Insurance (iv) Warehousing (v) Advertising.

Every business is directed to the achievement of certain objectives. Objectives refer to all that the business people want to get in return for what they do.