Question

define trade. explain briefly different types of trade
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Answer 1

Answer:

Explanation:

Trade is a basic economic concept involving the buying and selling of goods and services, with compensation paid by a buyer to a seller, or the exchange of goods or services between parties.

Trade can be divided into following two types, viz.,

• Internal or Home or Domestic trade.
• External or Foreign or International trade

1. Internal Trade

Internal trade is also known as Home trade. It is conducted within the political and geographical boundaries of a country. It can be at local level, regional level or national level. Hence trade carried on among traders of Delhi, Mumbai, etc. is called home trade.

Internal trade can be further sub-divided into two groups, viz.,

Wholesale Trade : It involves buying in large quantities from producers or manufacturers and selling in lots to retailers for resale to consumers. The wholesaler is a link between manufacturer and retailer. A wholesaler occupies prominent position since manufacturers as well as retailers both are dependent upon him. Wholesaler act as a intermediary between producers and retailers.

Retail Trade : It involves buying in smaller lots from the wholesalers and selling in very small quantities to the consumers for personal use. The retailer is the last link in the chain of distribution. He establishes a link between wholesalers and consumers. There are different types of retailers small as well as large. Small scale retailers includes hawkers, pedlars, general shops, etc.

2. External Trade

External trade also called as Foreign trade. It refers to buying and selling between two or more countries. For instance, If Mr.X who is a trader from Mumbai, sells his goods to Mr.Y another trader from New York then this is an example of foreign trade.

External trade can be further sub-divided into three groups, viz.,

Export Trade : When a trader from home country sells his goods to a trader located in another country, it is called export trade. For e.g. a trader from India sells his goods to a trader located in China.

Import Trade : When a trader in home country obtains or purchase goods from a trader located in another country, it is called import trade. For e.g. a trader from India purchase goods from a trader located in China.

Entrepot Trade : When goods are imported from one country and then re-exported after doing some processing, it is called entrepot trade. In brief, it can be also called as re-export of processed imported goods. For e.g. an indian trader (from India) purchase some raw material or spare parts from a japanese trader (from Japan), then assembles it i.e. convert into finished goods and then re-export to an american trader (in U.S.A).

Answer 2

In this question, we need to answer about trade and its type.

• Trade means buying and selling goods at a price that is being agreed upon by both parties.
• A trader purchases goods from the manufacturer and sells them to the consumer.
• Trader act as a connecting link between consumer and manufacturer.
• Trade is of two types i.e. Internal and external trade.
• Internal trade is a trade that is done between the geographical boundary of the country.
• Internal trade is f two types i.e. Retail and wholesale.
• Wholesale trade is a trade in which a large number of goods are purchased and sold.
• Retail trade is a trade in which a retailer buys goods wholesale and sells a single quantity to consumers.
• External trade is a trade in which buying and selling of goods are done between two countries.
• External trade is of three types i.e. Import, Export, and Enter port trade.
• Import means when some good is coming to your country from some other country.
• Export means when goods are sold to another country.
• Enter port means goods purchased from another country to sell to another country.

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