CBSE Class 9 Fundamentals of Business Activities Notes

Various business activities may be classified into two broad categories — industry and commerce.

INDUSTRY is concerned with the production or processing of goods and materials.

Commerce includes all those activities which are necessary for facilitating the exchange of goods and services.

On the basis of these two categories, we may classify business firms into industrial and commercial enterprises.

COMMERCE

Commerce includes two types of activities, viz., (i) trade and (ii) auxiliaries to trade.

(i) Buying and selling of goods is termed as trade.

(ii) But there are a lot of activities that are required to facilitate the purchase and sale of goods. These are called services or auxiliaries to trade and include transport, banking, insurance, communication, advertisement, packaging and warehousing.

Factors Affecting Business

1. Economic - Interest rates, inflation rates, changes in disposable income of people, stock market indices and the value of rupee are some of the economic factors that can affect management practices in a business enterpris

2. Social –The social environment of business include the social forces like customs and traditions, values, social trends, society’s expectations from business, etc. Traditions define social practices that have lasted for decades or even centuries.

3. Political - Political environment includes political conditions such as general stability and peace in the country and specific attitudes that elected government representatives hold towards business. The significance of political conditions in business success lies in the predictability of business activities under stable political conditions.

Profit Orientation of Business

Profit may be regarded as an essential objective of business for various reasons:

(i) It is a source of income for business persons,

(ii) It can be a source of finance for meeting expansion requirements of business,

(iii) It indicates the efficient working of business,

(iv) It can be taken as society’s approval of the utility of business, and

(v) It builds up the reputation of a business enterprise.

Vocation

Vocation is a strong feeling of suitability for a particular career or occupation.

Features of Vocation

(i) Training consists of units of Competency – A training qualification has a specific set of units of competency which together make up the overall set of skills and knowledge required for qualification.

(ii) Competence Based – Training is provided to meet a set of performance criteria. Each individual must be able to demonstrate competence to a satisfactory level in order to be determined as competent. Hence there is no ‘pass’ or ‘fail’. Competence based outcome is either ‘satisfactory or not yet satisfactory’ or on completion of all unit requirements ‘competent or not yet competent’.

(iii) Job Ready – Training provided includes practical and hands-on training which is relevant to the industry of work hence making an individual job- ready upon successful completion of the training.

(iv) Customised Training –One can choose units of competency relevant to one’s job functions. Training assessment can be customized to industry specific tasks.