Commercial Applications
Answer
Two characteristics of business are:
Sale, Transfer or Exchange — All business activities involve sale or exchange of goods and services for some consideration (price). If there is no sale, transfer or exchange for a price, it will not be a business activity. For example, cooking food for personal consumption is not business, but cooking and selling it to others for a price becomes business.
Profit Motive — The primary objective of business is to earn money and acquire wealth. A business is not charity. Profits are essential for the survival, growth, and expansion of business. However, business must earn profits by serving society.
Related Questions
A hospital that provides free services to the needy but charges nominal fees from others is classified as a non-profit organisation.
- True
- False
A farmer grows organic vegetables and supplies them to local markets. To increase profits, the farmer sets up a cold storage unit to store surplus vegetables during the off-season and sells them when prices are higher. Which type of industry does the farmer's activity represent?
- Extractive Industry
- Genetic Industry
- Manufacturing Industry
- Construction Industry
Define commerce.
List any two differences between industry and commerce.