1.

1 INTRODUCTION

Business studies is the study of the management of individuals to maintain collective productivity, which accomplishes particular creative and productive goals, usually to generate profits. Meaning and Origin According to the Longman Dictionary of Contemporary English, business studies is the study of economics and management. It is the study of subjects connected with money and managing a business. The term business is derived from the word busy. Thus, a business means being busy either as an individual or as a society as a whole, doing commercially viable and profitable work. A business can also be defined as an organization that is legally recognized and designed to provide goods and services for consumers. Similarly, a business may be defined as an economic activity involving the production and sale of goods and services undertaken with the motive of earning profit by satisfying human needs in society. The basic characteristics of a business are: (1) an economic activity, (2) production or procurement of goods and services, (3) dealing in goods and services on a regular basis, (4) sale and exchange of goods and services, (5) profit earning or motive, and (6) elements of uncertainty and risk. Business risk refers to the possibility of a loss that is beyond the control of a businessperson. Human activities can be classified into two categorieseconomic and non-economic. Economic activities deal with material resources and are concerned with the business of living. Noneconomic activities, on the other hand, deal with emotions. Economic activities may be further divided into three categories, namely, business, profession and employment or service. Business activity involves the allocation of scarce resources among alternative uses. Profession means an occupation that renders specialized expert and personal service. In employment or service, a person undertakes to work for another according to the terms of a service agreement in return for a salary or wage or even a commission. Another way to categorize business activities is on the basis of their function. According to this classification, business units can be categorized into industrial and commercial enterprises. Industry refers to the production or processing of goods meant for consumption or for further production. Industrial enterprises are engaged in the production of goods. Commercial enterprises are engaged in trade and services. Commerce is defined as those activities that involve the removal of hindrances in the process of exchange of goods.