Economic Activities

Economic Activities and Business
  • Economic Activities
    • These are those activities which are done in order to earn income or living.
    • The main motive behind these activities is to create wealth and earn income.
    • They are also known as occupations.
    • They are concerned with the production and distribution of goods and services.
    • These activities comprise of Business,Profession and Service.
    • The motive of these activities is to earn money.
    • It result in money income and profit.
    • It is measured in terms of money.
    • These activities include production and selling of goods.
  • Non Economic Activities
    • These are those activities which are undertaken for personal satisfaction or due to religion or social obligations.
    • Human Beings engage in such activities due to love affection patriotism charity and other such sentiments.
    • These activities comprise of Religious,Social and other non monetary works.
    • They are done for personal satisfaction human feelings.
    • These result in personal satisfaction.
    • It cannot be measured.
    • These activities involve human feelings and satisfaction
  • There are 3 types of Economic activities
    • Business
      • Business includes all the activities concerned with sale or exchange of goods and services with aim of earning profits.
      • Business may be defined as an activity in which different persons exchange something of value weather goods or services.
      • It is an activity which involves the satisfaction of human wants.
      • It involves regular or recurring purchase and sale of goods with the main motive of earning profits.
      • Business is an economic activity because it is associated with sale and exchange of goods and services with the aim of earning profits.i.e. it is concerned with the creation of wealth.  
    • Profession
      • Profession may be defined as an occupation which includes rendering of personal services of a specialized nature.
      • The professionals render personal services of a special and expert nature.
      • Professionals charge fees from their clients for the services rendered.
      • They receive advance education and special training for example Lawyer must have LLB degree.
      • Professionals are generally members of a professional body or association
    • Employment
      • A person is said to be employed or in service when he undertakes to work under a contract of employment.
      • He promises to perform such work as may be assigned to him by the employer.
      • He is paid wage or salary , bonus allowances and other benefits.
  • Business Activities
    • Manufacturing Enterprises
      • Manufacturing enterprises are those enterprises which are engaged in the production of something.
      • They can be of analytical synthetic or of assembling concerns.
        • An oil refinery which separates petroleum from crude oil is of analytical concern.
        • Soap mills which produce soap are of synthetic concerns.
        • Plants engaged in production of TV radioactive sets that is which combine several materials to form product are of assembling concerns.
    • Mining Enterprises
      • These are those enterprises which are engaged in production of gold ,silver,coal etc.
    • Agricultural Enterprises
      • These are those enterprises which are concerned with the growing of crops such as wheat,rice vegetables fruits etc.
    • Service Enterprises
      • These are those enterprises which provide direct and commercial services such as Banks,Companies,Warehouses, Firms, Cinama houses,Transport Concerns,Eating Houses etc.
    • Trading enterprises
      • These are those enterprises which are engaged in the distribution of goods and services.
Relationship Between Business,Profession and Employment
  • A large number business enterprises employs a large number of persons in order to achieve their objectives.
  • They include the services of professionals like Charted Accountants,Lawyers,Architects,Cost Accountants,Management Consultants etc.
  • They are expert in their respective fields thus their services are quite helpful in the smooth flow of business activities.
  • Professionals and other employees provide necessary manpower for efficient running of businesses.
Comparison between Business Profession and Services
  • Mode of Establishment
    • Business : Entrepreneur decision with prescribed legal formalities.
    • Profession : Membership of a professional Body.
    • Services : Service contract or letter of appointment.
  • Nature of Work
    • Business : Supply of Goods and Services
    • Profession : Personal services of expert nature.
    • Service : Work assigned under the contract.
  • Qualifications : 
    • Business : No Minimum Qualification Required.
    • Profession : Minimum Education and Training.
    • Service : Depends on type of Job.
  • Basic Motive
    • Business : Profit Making.
    • Profession : Providing Services.
    • Services : Increments/Income.
  • Capital
    • Business : Required depending  on size
    • Profession : Small amount needed.
    • Services : No capital required
  • Reward
    • Business : Profit
    • Profession : Fee
    • Services : Wage or Salary
  • Risk
    • Business : inherent
    • Profession : very little.
    • Services : No Risk
  • Transfer of Intrest
    • Business : Ownership transferable as per law.
    • Profession : Transfer not possible
    • Services : Not Transferable
  • Code of Conduct
    • Business : No Code Prescribed
    • Profession : Professional Code Binding
    • Services : Terms and Conditions of Service Contract.
  • Public Advertisement
    • Business : Need to give.
    • Profession : Prohibited
    • Service : No need to give

Comments

Post a Comment