Commercial Applications
Which of the following correctly distinguishes between commerce and trade?
- Commerce involves production, while trade deals with distribution.
- Commerce involves distribution and auxiliary services, while trade focuses on buying and selling goods.
- Trade creates time utility, while commerce creates form utility.
- Commerce is a subset of trade.
Commercial Orgs Intro
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Answer
Commerce involves distribution and auxiliary services, while trade focuses on buying and selling goods.
Reason — Commerce is a wider concept that includes trade (buying and selling of goods) as well as auxiliaries to trade — transport, warehousing, insurance, banking, advertising, etc. Trade is therefore a part of commerce. Option 1 is wrong because production is industry's role; option 3 is wrong because form utility is created by industry; option 4 is wrong because trade is a subset of commerce, not the other way around.
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