What is meant by business? Describe any two characteristics of business.
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Business is an economic activity that involves the exchange, purchase, sale or production of goods and services with a motive to earn profits and satisfy the needs of customers. Businesses can be both profit or non-profit organizations that function to gain profits or achieve a social cause respectively.
1)An Economic Activity :
•A business is an economic activity which includes the purchase & sale of goods or rendering of services to earn the money.
•It is not concerned with the achievement of social and emotional objectives.
Example:Wholesaler sell goods to the retailers and retailers sell goods to the customers.
2)Manufacturing or Procurement of Services and Goods:
•Before offering goods to the consumer for consumption it should be manufactured or procured by businesses.
•Business enterprise converts the raw material into finished goods.
•Organizations also procure finished goods& services from the producers to meet the needs of the customers in the market.
•Goods can be a Consumer good like sugar, pen, ghee, etc. capital goods include machinery, furniture, services like transportation, banking, etc.
Example:Individual retailer buys the toffees from wholesalers in a specific quantity and sells it to the ultimate consumer.
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