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nature and purpose of business

•BUSINESS
•The term business is derived from the term busy, an occupation in which a person in regularly engaged
•GOODS AND SERVICES
•It is the production and sale of the goods and services to earn profit
•ELEMENT OF RISK
•There is uncertainty of return

features of business 

•ECONOMIC ACTIVITY
•*Activity which helps in earning profits.
•PRODUCTION OF GOODS AND SERVICES
•*It involves production and supply of goods and services
•REGULAR EXCHANGE OF GOODS AND SERVICES
•*Every business transaction must be done on a regular basis.
 
•UNCERTAINTY OF RETURN
•*Return depends on factors like fashion, change in demand, government policies.
•PROFIT EARNING
•*The main aim of every business is to earn profit either by improving quality or reducing price.
•ELEMENTS OF RISK
•*Business is full of uncertainty ,which causes risk.

ELEMENTS OF BUSINESS ENVIRONMENT 

•SOCIAL
•POLITICAL
•LEGAL
•ECONOMIC
•TECHNICAL

profession 

 

It includes all those activities which requires special knowledge & skill in their occupation.

The membership of a professional institution & a certificate is required in a profession.

The main objective is service.

The reward is known as professional fees.

No transfer of interest and minimum capital is required.
Professional code of conduct is followed

 employment  

 

There is an employer and employee relationship & performance of work has to be done as per rules of the service.

The reward for employment are wages, salaries

There is no capital required due to which the risk element is less.

Transfer of interest is not possible until stated

The code of conduct decided by the employer is to be followed.
The qualification and training as prescribed by the employer has to be followed

 

liability 

 
•DEFINITION

•Claims of various stakeholders on the business of persons.

•A person has to make a lot of payment in cash to various parties such as employees, raw materials ,supplies,etc.

•LIMITED LIABILITY

•The business houses who have limited liability do not run their risk of losing their private property,

•The creditors cannot claim the private property of the businessman to recover the payment.

•UNLIMITED LIABILITY

•The business houses who have unlimited liability expose their private property to their creditors .

•The outsiders can claim their outstanding payment through private property
objectives of business
    EcONOMIC OBJECTIVE: This is the objective without which a business.
        Profit making :finance is the life blood of business. Its main aim is to earn profit. Its the money earned over and above the capital invested, so every decision of a businessman deals with earning profit.
Innovation: Today the consumer is becoming more and more aware that he/she is a global customer.
 Innovation can be done in 2 ways:
 In manufacturing product or service
 In various skills needed to supply the products Market standing
        Its the position of an enterprise in relation to its competitors as business is the market leaders, when more than half of his consumer consumes his products .
      Therefore, a businessman has to provide quality product at reasonable price.


   social objective
High quality product at a fair price.
The businessman must not indulge in adulteration, hacking and black marketing.
Contribution to community development by providing hospital facilities &educational institutions.
Fair return to the investors: A business is run by shareholders money so it is the responsibility of the business to give a fair return.
Opportunity should be provided by the businessman to the unemployed youth. 


 individual objective 
To get things done from others a businessman has to fulfill the personal objectives:
Good monetary incentives to attract skillful employment.
Non-monetary incentives such as recognition and status.
Challenging business with good career prospective.
Good communication system (formal & informal) for correct information and news





 
res ou can see he pp for more information 

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