NCERT-solution for class-11 chapter 1 nature and purpose of business
Topics–Nature and purpose of business
- Concept of business
- Human Activities
- Meaning of business
- Definition of business
- Characteristics of business
- meaning and Definition of profession
- Characteristics of profession
- meaning of employment
- features of employment
- Difference among, business , profession & employment
- objectives of business
- Role of profit in business
- Meaning of business risk
- nature of business risk
1.Concept of business
Everyone is busy in some way or the other.
- some people are busy in producing thing
- some people are busy in buying and selling thing
- some people are busy in the profession of law
- some people are busy in treating patients
- some people are serving in factories,
- some people are serving in government offices.
- some people are busy in propagating religion
- some people are busy in doing social work
Economics Activities = business+profession+Employment
Whatever action humans do for the satisfaction of their desires is called human action. Human woes can be related to money and also related to mental peace. On this basis, they are divided into the following two parts.
A.(Economic Activities):-The Christians who aim to earn money are called economical Christians like. Buying and selling goods, doing advocacy work, working in a factory etc.
- business: Business refers to the economic activity that is done on a continuous basis to make a profit by the production and sale of goods or services, such as clothing store transport, etc.; Purchase and sale of goods at the clothing store and transport of services at the transport; They do not sell any goods, but hire them by providing the service of transporting goods from one place to another.
- profession: Profession refers to the economic activity that is done by a person with special knowledge and skills to serve the various sections of society objectively; Like – time, treatment etc.
- Employment: Employment refers to working for another under a special agreement in exchange for remuneration, such as working in factories, government offices, etc.
(Non-economic Activities):-The Christians who do not aim to earn money are called uneconomic Christians; Such as wealth promotion, country service etc.
3.Meaning of business
In narrow sense, business refers to the purchase and sale of goods; But in a broader sense, business is the sum of all the activities that are done from the production of goods to services to the final consumers. ‘Here services mean the actions that take goods from the production place to the consumption place. Services like transport and conveyance, Bhima, banking etc.
4.Definition of business
- According to Dr. WW R spriegel :- all of the activities included in the production and sale of goods. or services may be classified as business activities. Dr, w.R.S spriegel
- According to L.H.haney:- business may be defined as human activity directed towards producing acquiring waelth through buying or selling goods, L.H.haney
5.Characteristics of business
- An economic activity: Business covers only economic activities; Economic activity refers to the receipt of money by exchange of goods.
- Exchange of goods and services: Handling of goods or services is absolutely necessary for business; This means that if a person purchases an item or service for his own consumption, this action will not be called business.
- Regularity in dealings: In fact, I call business as an economic activity that is continuous, that is, purchase and sale should happen again and again. If this action occurs occasionally instead of continuously, then it does not come under business.
- Profit motive: In order to consider a purchase-selling practice as a business, it is necessary that the objective of the businessman should be to earn profit; but sometimes there can be loss while trying to profit. It cannot be said that if any behavior is lost, it will be out of business;
- Element of risk: Business should not be considered as a flower bed SEZ. In this, there are cuts on the feet, that is, problems arise, these obstacles can cause loss, a small mistake or the failure to solve a problem can cause the entire business to end; The end of the sun – the profit and loss in the business of love and sorrow and happiness go together.
6.Meaning and definition of profession
it refer to that economic activity which is conducted by a person having some special knowledge and skill which is used imparially to serve the various sections of society,
- According to webster’s Dictionary:-profession is that occupation in which one professes to have acquired specialised knowledge, which is used either in instructing , guiding or advising others–
7.Characteristics of profession
- body of specialised knowledge and technique: The first feature of the profession is that a professional person should have specific knowledge and technical prudence, an ordinary person cannot run a profession. Hence; An occupation done by an ordinary person cannot be called a profession;
- Formalized methods of Acquiring Training and experience:-There should be a formal arrangement for training and experience of the profession, that is, the same human role is called a profession whose institutions are available to gain knowledge.
- code of conduct:– Members of a profession are bound to abide by the prescribed code of conduct; The code of conduct includes rules relating to the profession, honesty, integrity and the scale of ethics accepted; such as conduct for advocacy, medical accountancy, etc. Code has been fixed,
- priority of service over economic consideration: Practicing like other thongs and trade is also a means of earning money for survival, in which society is served with proper remuneration based on special knowledge, that is why professional people would get respect in society Huh ; For example, a doctor makes a living from the medical profession but social service is his main objective.
8.Meaning of employment:
it refers to that economic activity under which people work for others, and receive remuneration in lied thereof,
9.Features of employment
- service to others: The first feature of employment is to serve for others,
- personal service :The employee has to provide the service himself, that is, he cannot serve another person in his place.
- Agreement;Employment is received under a special agreement. The basis of the agreement is written. Similarly, the basis of remuneration is also written.
- servant: The employee would be his master’s servant and work as he said
- no risk; The inherent risk in the work rests with the owner and not the employee.
10.Difference among, business , profession & employment
|basis of difference||business||profession||employment|
|1. communication||If necessary, some statutory procedures can be started by completing||Can be started by taking a certificate from the concerned officer||Starts with appointment letter|
|2.nature of work||Production and purchase of goods and services||Personal Services as a Specialty||Work assigned by employer as per agreement|
|3.investment||Capital is required according to its size and nature.||Often less capital is required||Capital is not required under this|
|4Risk.||There is a risk||It has less risk||No risk|
|5.qualification||It does not have to be of any formal qualification||It is very important to have formal qualifications||It is not necessary to have formal qualification for all jobs.|
|6.objective||Making profit||Earned by service||Earn as a salary or wages|
|7.transfer of interest||A businessman can transfer his interest||A professional cannot transfer his interest||Not even an employee can transfer his interest|
|8.test of efficiency||Profit earned||Quality of services provided||Jobbing spirit|
|9.code of conduct||There are no business practices.||The profession does not have a code of conduct||It involves a contract in place of a co-operation|
11.objectives of business:
- profit making: The objective of establishing each business venture is to earn profit. Just as I get interest and rent after giving loan to landlord-owner after giving loan to lender, similarly a businessman should get profit after doing business.
- creation of customers; The second economic objective of the business is to create a surgeon of customers, a surgeon of customers means attracting more and more potential consumers to their products. The objective of the client surgeon is linked to the purpose of earning profit. Because the benefits will be obtained only when there is a buyer of goods of a businessman. Therefore, the business has to attract the customers more than itself.
- Innovation: Business is facing a progressive era today. Consumers are becoming aware day by day, customs and customs are also constantly changing. In this stage only the existence of business is possible with the help of innovation. New innovation means to innovate, such as creating new products, introducing new ways of using old products, improving production processes
- high quality goods at fair prices: The first social objective of the business is to make available consistently high quality items to consumers in sufficient quantity and at reasonable prices. The businessman should not adulterate the goods, do not hoard, make available to the consumers the required quantity and sell the goods at a reasonable price, avoiding the tendency of profiteering.
- contribution to community development: In the development of the society in which the business is born and flourishes, it must definitely contribute something. Businesses can fulfill their purpose by establishing libraries, medical institutions, etc.
- fair return to investors; Today, the standard of business has become so large that thousands of people have owned it rather than one or a few individuals. Many people of the society buy part of the commercial ventures, the business is run only on the basis of the capital invested by the shareholders.
- providing employment: Today unemployment is the biggest problem of the society. The aim of the business should be to overcome this problem. Your country. I should provide employment opportunities to the people,
12.Role of profit in business
- For long survival: Just as a live needs food to survive, similarly business needs profit to survive. Profit is helpful in keeping the business going for a long time, in the absence of profit, the rationale of establishing a business ends.
- For Rapid growth: Every businessman wants his business to grow, growth means growth in the scale of business, it is okay that all businessmen want to grow their business, but here are the questions how development is possible, this Answer to the question is possible with the money received
- For increasing efficiency; Apart from self interest there is no such power that can get people to work, here self interest is intended for profit. That is, profits are the power that motivates people to do more and better work, in running a business there are two classes of participation – the owner and the working class. I want Swami to get maximum benefit from him, so he tries to do more good work,
- For building prestige and Recognition: Every businessman wants his reputation in the society to increase and he has a different identity. To achieve both of these, a businessman has to satisfy all the related parties, such as giving good quality goods at low prices to the customers, paying adequate wages to the working class, paying substantial dividends to the shareholders.
it refers to that economic activity which undertakes the production of goods and services,
- Genetic Industry: Genetic industries mean the industries under which the breeds of animals and vegetation are improved and made more useful. Animal husbandry, poultry, plantation etc. are included in these industries
- Extractive industry: Extraction industries are those industries in which any extract is made from earth, water or air, such as extracting coal, iron, gas, etc. from khans and kuo, removing stones from open mines, production of grains and other commodities from agriculture. do ,
- manufacturing industry: Factory industries mean industries in which raw materials or semi-manufactured goods are converted into finished goods with the help of human machines, such as cotton to cloth, cast iron to steel sugar cane sugar.
- constructive industry; In these industries, constructive works are done by using items produced by other industries, such as building buildings, bridges, roads, dams etc., using cement, iron brick, wood etc., these industries usually used to manufacture such items. Huh ,
Three-tier industries, also called service industries, include services in the service industry that help the business to run smoothly, such as – services of traffic, bank, Bheema, advertisement, collection etc.
- Transport Industry: The movement to move goods from one place to another can be overcome by the traffic industry.
- banking industry: Can be overcome with the help of
- insurance industry: Can be overcome with the help of
- Advertising industry: Can be overcome by
it refers to the sum total of all those activities which are engaged in the removal of hindrances of person, place time Risk, finance and information in the exchange of commodities
15.Meaning of business Risk
it refers to the possibilities of inadequate profits or even losses in the business because of uncertainties
16nature of business Risks
- Risk is unavoidable A businessman cannot get out of the trap of risk. The only reason for this is that business is done for the future and the future is uncertain, yes, risk can definitely be worked out.
- Degree of risk varies with the size of business: the risk is less small sized businesses and more in large sized businesses
- profit is consideration of risk taking; What the business gets in return for taking the risk is profit, the higher the risk, the more profit there is.
- Risk depends on the nature of business: The amount of risk depends on the nature of the business. The risk is less in the businesses in which daily use items such as salt, lentils, flour, etc. are traded. On the other hand, businesses which sell fashion items are more at risk because fashion changes quickly.