BUSINESS

• All the economic activities related to production and exchange of goods or services for an economic return.

Industrial sector • .BUSINESS SECTORS • The business sector consists of two main subsectors: • .tertiary or service sector .

Businesses which deal in Finance & Financial Services . Businesses which distribute goods 4. Businesses which produce services 3. Business which produce goods 2.CLASSIFICATION OF BUSINESS • • • • • Business enterprises can be classified as under 1. Businesses which facilitate distribution of goods • 5.

• There are two categories of goods • 1.e. • 2. Commodities – goods which are produces by the primary sector i. Products – Goods that are produced by the secondary sector. .Business which Produce • This class of business is involved in actual production of goods. agriculture and mining.

the more is the contribution of this sector to the GDP . • The more developed an economy.Business which produce Services • This is the tertiary sector of the economy. • This sector provides services . • This sector is a barometer of how developed an economy is.

• This is an important business because it distributes the goods produced by other businesses.Business which Distribute Goods • This business is also a part of services. retailers. • These include wholesalers. exporters and importers .

transportation firms.Business which Facilitate Distribution of Goods • This business helps in the distribution of goods. • Included in this are – Warehousing. Auction houses.firms and financing firms. exchanges. advt. .

. Stock Exchanges etc.Businesses which deal in Finance and Financial Services • These include Commercial Banks. NBFS. Insurance Services.

CLASSIFICATION OF INDUSTRIES • Industry consists of all those firms which produce goods and services. ownership category. size . on the competitive structure. use of the output. • It is that part of business which creates form utility. • Industry may be classified on the basis of the nature of activity.

They can be • Extractive Industries • Genetic Industries • Manufacturing Industries • Construction Industries • Service Industries • IT Industries .Classification on the Nature of Activity • This classification is on the basis of the activity being carried out by the industry.

• There are two types of market competition• Perfect Competition • Imperfect Competition .Classification on Competitive Structure • This classification is on the basis of the competitive structure of the market.

.The products are homogenous . There is no entry or exit barrier. 5. There is no transport cost. 2. 4. All the buyers and sellers are small. 6.Perfect Competition • • • • • • • • Following are the features of a perfect Competition 1. There are very large number of buyers and sellers.Buyers and sellers are perfectly knowledgeable. 7. There is complete mobility of factors of production. 3.

. • 4. Duopoly. Monopoly • 3.Imperfect Competition • Following types of competitive structures are included in this• 1. Monopolistic Competition • 2. Oligopoly.

there are a large number of sellers. • No seller is large enough to influence the competition.Monopolistic Competition • In a monopolistic competition. . but the products are differentiated.

. there is a single firm controlling the supplies.Monopoly • In monopoly . • There may be a large number of buyers or few buyers. • The firm has full control over the pricing.

Oligopoly • There are a large number of buyers but only a few sellers. • There is little or no product differentiation. .