Provides Industrial Inputs

Agriculture sector provides inputs for industrial production. A piece of cloth made in a textile industry will not be produced until cotton is not grown and is available for production. Increase in agriculture production will make available necessary inputs for industrial production.

Increases Productivity Gains

If agriculture production grows, the cost of raw materials will decrease and their quantity demanded will increase. Industrialists will take advantage of the economical raw material to produce on a large scale. This large scale production will decrease the unit cost of production and increase the efficiency of industry. Therefore, for large scale industrial production, it is necessary that agriculture sector must also grow.

Market for Industrial Production

Industrial production includes a lot of products which are consumed by the agriculture sector. Fertilizer, tractor, chemicals are industrial products which are used by agriculture sector. Therefore, if agriculture production will grow, there will be more demand for tractors, fertilizers and chemicals and hence industrial production will also grow. This will benefit both the sectors.

Budget

Budget is a document which summarize the revenues and expenditures of the past year and sets targets for the next year and gives a detailed plan for achieving the targets. It also gives detail from which sources the revenue will come and what will be the respective heads of the expenditure both the current and non-current expenditure. It also gives detail to the sources of funds from which the deficit would be finance.

Population Growth and Labor Force

If the rate of population of growth and the growth in labor force is equal or is close then population growth is not much of a problem. This will suggest that dependent population is not very high and the number of people willing and capable of work is also increasing.

Population Growth and Resources

If population growth is high and resources are also expanding, then population growth is not a problem. If a country is experiencing expansion and boom in the economy, it needs more labor to fuel its growth. Therefore, population growth is not a problem in the periods of expansion in the economy.

Poor Health And Education Facilities

Most of the country in world globe, the health facilities are very poor.Child death rate is very high. There is one doctor for 1500 people. In rural areas, there are few dispensaries and maternity homes. Similarly, education facilities are also very poor. There are thousands of ghost schools and there are villages in which there is no school at all. It has not hard to imagine why the literacy rate is as low as 35%.

Importance of Households

The life has eased out state of the art the electronic items. Development in electronics has made a luxury of yesterday a comfort of today. With the advancement in technology, electronic products have matured in quality and their cost has decreased. Now even a middle class family can have access to computer, microwave over, refrigerator etc. All of these products are run on power resources.

Dispute Over Land

There are a lot of dispute over land in the rural areas due to which the ownership of the land remains undecided. During the dispute, the land remains utilized and it is complete waste of land resources. Moreover, dispute also arise between the heirs for the just distribution of inheritance.

Change In Reserve Ratio

Every schedule bank has to put in reserve a certain ratio of the deposit with a central bank. This is called the required reserve ratio. If the government increases this ratio, banks will have less money to give on credit due to which money supply decreases. Conversely, if the government decreases this ratio, banks will have more money to give on credit due to which money supply increase.

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Lack of Communication

Farmer living in the villages and less privileged areas have very little knowledge of the level of demand in the market for a particular product at a given time. Therefore, if they bring in more quantity of a good than what is demanded, they will have to sell at alower price because of the perishable nature of agricultural goods.

Reducing Excessive Documentation

There is a lot of documentation involved when one wants to establish an industry. An investor has to pay bribery at various instances for the people in charge of documentation. This discourages an investor and new incumbents. Therefore, Government has to make this process simpler and more industrial friendlier and provide one window operation to the industrialists.

Low Quality Products

With the dearth in finance, people in cottage industries find it very difficult to make quality products in the available finance they have. Moreover they lack of ability to produce high quality products. They usually produce things manually or by using traditional machines which does not bring in the same quality than giant competitors.

Contract of Affreightment

A contract of carriage of goods by sea is called as contract of affreightment. It is a contract by which a shipowner under takes to carry the goods of another in consideration of a price called Freight. A contract of affreightment may take the form of charter party, or a bill of lading.

Lay Days and demurrage

Lay days are a certain number of days allowed by the charter party to the character for the purpose of loading and unloading the cargo. The lay days begin to run from the time that the the character has received notice of the ship's arrival at the stated port and her readiness to load and unload. These days may be either Running Days, in which case they are counted from mid-night to mid night including any intervening holidays or working days, which are the days on which the work is normally done i.e excluding holidays. It is essential that the moves of loading and unloading must be completed within the stipulated lay days and where no time is fixed then the work must be completed within the reasonable time, regard being had to the existing circumstances and the custom of the port.

Resistance to Change

Unions always resist change whether it is good or bad  change. It has become a culture to oppose everything without making an approprite evaluation of the process. If an empolyer wants to introduce any technological advancement in the production process, the union members will always see it as an indication  of forthcoming downsizing.

Efficient Utilization of Savings

The rate of saving is low with respect to the rate of investment. Moreover, this low saving goes to stock market and real estate which are unproductive sectors. Therefore, savings are not utilized to their best use. With the growth industrial sector and reforms and measure to facilitate industrilists, more and more money will come into industries and savings will be utilized for productive use.

Total Disablement

Total Disablement means such disablements, whether of a temporary or permanent nature, as in capacities a workmen for all work which he has capable of performaing at the time ofaccident resultinh in such disablement. Provided that permanent  total disablement shall be deemed to result from every injury specified in part of Table or form any combination of injuries.

Partial Disablement

Partial Disablement means, where the disablement is of a temporary nature, such disablement as reduces his earning capacity in any employment in which he was engaged at the time of the accident resulting in the disablement as reduces his earning capacity in every employement which he has capable of under taking at that time.

Partial Disablement may be of two types:-

1. Temporary Partial Disablement
2. Permanent Partial Disablement

Monopsony

Monopsony means "monopoly of buyers". If farmers bring in more quantity of a good than what is demanded, they have to settle for alower price because of the perishable nature of agricultural products. This creates a lot of frustation and disappoinment to the farmer who worked day in and day out to produce a particular good and than gets less than what he deserves.

Reducing Poverty

Many of the countries, more than 30% people live below the line of poverty. The poor people find difficulty in survival. Moreover, they lack in education and generally never beocme capable of doing anything which can improve their economic conditions. Therefore, the vicious circle of poverty passes to generations after generations. For economic development, poverty reduction is a basic prerequisite.

Organization

Organizations are the inventive social arrangements of our age and of civilization. It is a marvel to know that ten of thousand of people with highly individualized backgrounds, skill and interest are coordinated in various enterprises to pursue common instituionalized goals.

Legal Environment of Business

Every Business is surrounding by somemakes regulations and correct decisions. Some regulations are framed to help the determination of limitation of business. It is decided as to what can be done under it and what not. Some makes are the benefits of workers and customers, while some others are for the safeguards of business or trade agreements. Thus business regulations appear necessary for smooth running of business.

Price Mechanism and Government Directive

The allocation of economic resouces  different industries and trading in the private sector is allowed to be made through in the private sector is allowed to be made through the operation of the price mechanism. All decision regarding investment, output , and policies are allowed to be made by the price mechanism so for as the private sector is concerned.

So far as public sector concerned, all decisions with regard to investment, output and pricing, etc, are made by the control economic  authority or the planning commsion which is invested with full powers to manage, control and run production within the public sector.

Investment Banking

This is highly specialized work to deal in investment and the poor investor lack knowledge usually are guided investment banking in this field. They specialized in the marketing of new issues of stock and bonds. They sell these stocks and bonds to general public or institution. Usually investment  banks underwrite a coporations's new security issues. They in the capacity of securities and bonds guarantee the sale of the company's securities and deliver a cheque to it for these new securities. They make their profit by charging a commission. The securities of investment banks are useful not only to the company or the promoters but also to the investors.

Piece Rate Wage System

Piece wages method may be individual piece wage method or group piece work method. The former is particularly applicable ro repetitive work and the work due by each man can be wasily measured, operations performed by individuals and products/ standard by them can easily be inspected, counted and credited after each operations

Advantages:

1. The division of daily wage by the average daily production for ascertaining the cost per unit is a simple matter.
2. Varying efficiency of the worker is recognized. The efficient workers get more wgaes as compared with their less efficient fellow workers.
3. The workers are encourged to exert their best energies of work that they can turn out.

Disadvantages:

1. When the employer thinks the workers are earning too much, the rates arbitrarily cut.
2. This system is else regarded as a method of speeding up work without adequate remunerations.
3. The hard work may lead to a reduction of the amount of available employment.

Routine Procedure

Computers perform all routine work more quickly than experienced clerks. They prepare pay rolls, keep track of inventories, bill customers. Computers must be supervised otherwise they will make the same mistakes over and over unless they are given the correct instructions. The computer cal also store and up to date an employee's personal file, catalog his promotions and job transfers and even keep track of the the he has clocked in late.

Accounting and Billing

Computer easily accurately and quickly records all transactions and prepare all sorts of sales accounts, bills and invoices. It can address the envelops and send reminders when payments is delayed. The computer can also name the items sold and dispatched, this information to the warehouse. In retail stores, the cash register tape is the first step at a unified composition controlled system. The cash register tape is fed into a memory input which not only records the amount of sale and tax connected, but kept track of inventory and send orders for replacement.

Routing

Routing may be defined as the selecting of routes over which each pile is to travel in transformed from raw material to the finished products. The object of routing is to determine the best and cheapest sequence of operations and to ensure that this sequence is followed. Foremen or engineers in advance factional production, how work is to be processed and which machines are to be used. It may be noted that routing is automatic in continuous industries.

Planning

This is the first step of production management. Productions is planned according to the regular and casual demands of the product. When an order from customers is received, the production manager breaks it down into a complete list of necessary material and processes to manager compare the list of requirements with the machinery in any department is made good and production is about to begin.

Guidance of Poloticians

Economics is called "Political Economy" also because Economics and politics are closely related. Political decisions influence economics while Economic decision influence political attitude. Study of economics enables a political to understand the economic problems of the people and to adopt the right policies to solve them. A successful and good politician is a good economist also.

Understanding the Other Subjects

Since economics is a social science therefore it has link with other subjects being studied in the society like history, geography, psychology, mathematics etc. When the comparative study of economics is launched, we come to know about subjects also.
Practical Importance:
Studying economics is advantageous theoretically only but is commands practical importance.

Reasoning Power

Study of economics develops reasoning power because this study creates the quality of crating relationship between the cause and effect. Whenever he says anything, it is supported by convincing reasons. If any statement is made supported by reason, it can't be refuse to accept.

Synchronization With Economic Situation

The modern society keeps every now and then, if we do not study, we would not be capable to adjust over selves with the rapidly changing conditions. For synchronization with the economic situations, it is necessary that we must be aware about inflation, balance of payment, unemployment, tax system, agriculture, industry, Fiscal Policy etc.

Thrifting Attitude

Through the study of theory of consumption, it is revealed that how one can increase in his individual satisfaction? In other words, it depends on austerity which increase savings and saving is the basic condition for investment and economic development.

Widening Mental Spectrum

The man, with the help of economic study, can understand the economic realities of life like what is relationship between savings and investments , what meant by price level and how fare this concept near to the reality, what advantages can be cultivated by promoting exports and restricting imports etc. The understanding of these topic widens the mental horizon and reasoning power.

Sense of Responsibility

Study of economics creates the sense of responsibility towards the society. The society needs goods and services therefore, economic study creates the sense that how to synchronize the human activities with the material resources so that the consumption need of the society can be fulfilled.

Importance for Bureaucrats

The basic problem of the under developed countries is that the head ship of economic institutions is assigned to those who does not know 'e' of economics. Consequently, their departments do not work properly due to which economic development and growth retards. The study of economics for the Government Officers, therefore, is of paramount importance.

Solution of Economic Problem

We are fully aware of that the economy of every country has been facing many economic problem like inflation, industrial backwardness, general poverty, foreign indebtedness, adverse balance of payments etc. The study of Applied Economics highlights the causes of these problems and suggests remedial measures to the Government of every country.

How to Create Awarness in Citizens and Voters

Studying national income makes us better and well informed citizens. If the national income increases, Government gas more money to spend. Therefore, we can demand higher wages, Studying national income help us evaluate the performance of the Government and we can hold Government responsible if the promised growth and its benefits are not transferred at the micro level to the lower and middle class citizens.

Theory of National Income And Employment

The aspects of the economy of this reference discussed under Macro-economics includes the determinants of national income and the determinants of the determinants of equilibrium level of national income and employment etc. The alternate name of this theory, In fact, is the Macro-economics.

Theory of International Trade

Under Macro-economics that foreign trade position of a country analyzed in the sense what are the exports and imports of a country, what is the position of Balance of Payment and Balance of Trade etc.

Theory of Trade Cycle

Trade Cycles refer to the fluctuations in the level of national income. National income fluctuates from time to time. In other words, some time the economy is in the grip of boom but next time in the grip of slump. It is analyzed under Macro-economics that what is the nature, causes and effects of Trade Cycle.

Political Stability

If a country is not stable politically, the dream of economic development can't be culminated into reality, because if the Government makes a plant of development to be completed in 5 years but it is forced to leave power just after 2 years of assumption of power, whatever investment has been made in two years, would be wasted because the new Government would implement its own policy abandoning the old plan. The Government can succeed in implementing the programmed which satisfy the people and the Government can complete its tenure. Economic stability, therefore, is necessary for political stability which is possible through the study of economics only.

Planning of Development

The developing countries of the world do face the shortage of resources but they also allocate resources wrongly making the problem more serious. One of the important and modern branch of economics is Economics of Development which reveals that in which sectors the scare resources would be preferred to allocated so that maximum advantage can be cultivated. Economic Planning, therefore, is common in all countries.

Maximum Use of the Resources

Every country faces the problem of scarcity of resources therefore, leaving the known resources unexploited means nothing but the waste of resources. The resources lie idle in the developing countries due to which they remain under developed. The study of Economics of Development and Growth teaches that how to acquire maximum benefit from the available resources. Maximum utilization of resources guarantees the improvement in the living standard of the masses.

Sources of Illegal Income

Illegal Sources of income in a country includes income from Smuggling, hoarding, bribery, Prostitution, black marketing etc, because they are not earned incomes, when we compute the national income of a country, these incomes are excluded from the computation. Economic study, therefore, encourages the earning from these illegal sources.

Changes In Social Values

The people of underdeveloped countries are the followers of orthodox lines of action. They follow the superfluous customers and traditions which cause the waste of scare and precious resources. They consume lavishly on the occasions of various festivals, marriages and deaths. Waste of resources keeps the economy backward and retard economic development. Study of economics reveals that which expenditure is necessary and which is unnecessary. Avoiding unnecessary expenditure may be the guarantee of economic success and development. Economic study, in this way, changes the social values.

Centralized Economy

All the decision making authority rests with the Government. No one else is given the authority to make the economic decision even for oneself. Everyone has to follow the commands of the Government and everyone is treated like an employee of the Government.

Planned Economy

The Government in its own wisdom solves the central problems of the economy. Decision like what to produce? How to Produce? When to Produce? For whom to Produce? and how much to produce? are all taken by the Government. All the economic planning and policy making rests with the Government.

Significance of Businessmen

A businessmen or the producer can't earn maximum profit so long he knows the art of optimum combination of the factors of production. Similarly, he should know the adjustment of supply with the market demand, should know the causes of boom and slumps in the business, should have knowledge about the import and export policies of the Government. The same are the secrets of business success which are exposed by the study of economics.

Distribution of Wealth

The economies which are working on Capitalistic or Free Enterprise System, have the serve problem of inequitable distribution of wealth. The rich, in these economies, are very rich while the poor are extremely poor. Minority if rich over the majority of poor. Consequently, the society is bifurcated into two classes, rich and poor, due to which class conflict creates clashes destroying the whole of economic structure. The study of science of Public Finance teaches how to transfer wealth from rich to poor class making distribution of wealth equitable.

Micro Financing

Most of the country is a developing country and it is also suffering from the chronic problem of poverty. if the poor people are provided with finance, they have enough motivation to become self-employed and start cottage industries. This will supplement the large scale industries and other sectors of the economy. The example of Bangladesh in using micro finance to solve unemployment and poverty is a recent example.

The Availability of Substitutes

This is probably the most important factor influencing the elasticity of a good or service. In general, the more substitutes, the more elastic the demand will be. For example, if the price of a cup of coffee went up by $0.25, consumers could replace their morning caffeine with a cup of tea. This means that coffee is an elastic good because a raise in price will cause a large decrease in demand as consumers start buying more tea instead of coffee.

Marginal Rate of Subtitution

A consumer tries ti maximize his utility by consuming a combination of goods as permitted by his income. For consuming more one good, he has to forgo some units of the other good. For example, if a customer can spend his income on ice cream and snacks. For consuming more snacks, the customer will have to forgo some ice cream.
Marginal rate of substitution captures the rate of substitution between goods from one point to another as the customer modifies his consumption pattern to maximize utility.

Deficit Financing

Government is continually facing fiscal deficit, current account deficit and adverse balance of payment situation. To finance this, government borrows and pays interest. To finance this expenditure, government increase money supply and this creates inflation.

Change in Reserve Ratio

Every schedule bank has to put in reserve a certain ratio of its deposits with the central bank. This is called the required reserve ratio. If the government increases this ratio, banks will have less money to give on credit due to which money supply decrease. Conversely, if the government decreases this ratio, banks will have more money to give on credit due to which money supply increases which causes inflation.

Concept of Reserve Price

The buyers want to buy the good and services at the cheapest prices. The sellers want to sell their goods and services at the highest prices. The interaction of these forces in the market comes at equilibrium prices. Sometimes, in the market sellers get lower prices for goods and sometimes they get higher prices of their goods. The minimum price at which are willing to sell serve as a benchmark for them and is referred to as " Reserve Price". Therefore, reserve price is not the market price but is a price where sellers will not want to exhaust their supply. It is sometimes equal to market price and sometimes it is not equal to market price.

Promotion of Private Sector

Even though the Government intervenes in the need of hour, it sill provides incentive to the private sector and a level playing field to compete with the public sector. In industries where public sector and private sector coexist, government let the market forces work and does not crowd out the private sector.

Public Sector and Social Objectives

Usually the Public Sector is responsible to provide transport, communication, defense, currency management, utilities like telephone water, gas electricity etc. Government provides huge subsides to public enterprises so that these enterprises do not increase their prices to cover their losses. Government sometimes bears losses to avoid public displeasure in the form of inflation.

Optimum Factor Combination

A producer always tries ti achieve largest volume of output from a given outlay on factors such that these factors are combined in an optimal or most efficient way. The producer maximizes his profits and produces a given level of output with at least cost combination of factors. This level of least cost combination of factors will be optimum for him.

Social and Psychological Factors

Psychological factors and the nature of people also affect their consumption patterns. Due to the motive of precaution against future, people decrease the level of consumption in the present. Some people decrease their current consumption in a hope for a higher consumption in future. Some people decrease their current consumption because they have certain obligations to perform in the future which require money like performing some religious activities , marriage of their sons and daughters. Some people due to their generous nature consume all of their income in excess of personal consumption in the way of God.

Technical Economies

Advancement in technology is the single most important tool to reduce cost of production and increase productivity. But, technological breakthroughs are achieved after extensive spending on research and development. A large scale producer can afford research and development spending and achieve increase in productivity.

Perfect Competition on Long Run

In the long period, the firm reaches the equilibrium in the long period also when its marginal Cost becomes equal to marginal revenue. But in the long period, the firms marginal cost becomes equal to price and the price becomes equal to average cost. If the price is higher than normal profit due to which new firms would enter the industry. Entry of the new firms would increase the supply due to which price would decrease to average cost. In this way, so long even one firm is earning more than normal profit, the new firm would continue so much so profits of all the firms are converted into normal.

Imperfect Market

the Imperfect Market could be defined as:
Imperfect Market is the situation of the market when a single buyer or seller or limited group of the buyers or sellers is capable to purchase or sale of a commodity in such a manner that it could influence the price of the market.

Kinds of Imperfect Market:

• Duopoly
  
• Oligopoly
• Monopolistic Competition
  

Perfect Market

Perfect Market or Perfect Competition is the kind of market which comes into being due to the competition. This is the market where the competition is perfect and perfect competition prevails due to the following reasons:

1. Unlimited Sellers
2. Unlimited Buyers
3. Single Commodity
4. Perfect Knowledge of the Market
5. Open Market
6. Mobile Factors
7. No Transport Cost
8. Rule of one price
   

Classification of Market

A market is classified or given a particular name on the basis of following grounds:

1. On the basis of AREA like Local Market, national market or international market.
2. On the basis of Time like very short period market short period market, long period market or secular market.
3. On the basis of nature of Competition like competitive market or non competitive market.

The kind and nature of a market depends on the intensity of the competition prevailing in the market while the competition, in the broader sense, can be classified into two, Perfect Competition and imperfect Competition.

Time

The third influential factor is time. If the price of cigarettes goes up $2 per pack, a smoker with very few available substitutes will most likely continue buying his or her daily cigarettes. This means that tobacco is inelastic because the change in price will not have a significant influence on the quantity demanded. However, if that smoker finds that he or she cannot afford to spend the extra $2 per day and begins to kick the habit over a period of time, the price elasticity of cigarettes for that consumer becomes elastic in the long run.

Monetary Economics

Every economy, if the money supply is not according to the monetary needs of the country, may be the victims of problems of inflation or deflation. Inflation when money supply exceeds the demand for money and deflation would prevail on other wise situation. Money therefore, plays a crucial role. Demand and supply of money and the determination of the value are discussed under Macroeconomics.

Store Division

Store Division keeps the record of goods available for sale on all the departments of the stores. If the goods fall short at any department, the store division is informed which provides the required supply. Every department sands its requisite to this division which is catered by this division. As a result of proper organization, available stock of the goods in any department does not go below a particular level.

Control Division

Control Division is responsible for the finance and accounting of the stores. This division keeps the accounting record of all the cash and credit sale of the stores. Moreover, it also realize the credit created to credit sale.

Merchandise Division

Merchandise division is responsible is to organize the activities concerned with buying and selling of the different departments. The organizer of this division is termed as "General Manager Merchandise" who purchases the goods for the concerned department and is also held responsible for the sale of the same.

Limited Opportunities

As the personal business, due to the limited capital, is established and run on small scale therefore, not only the workers get low remunerations but they don't have the opportunities for their promotions. Whatever the posts and pay the workers get at the time of joining the business, they continue to get the same for a long time. The workers do not take keen interest in their performance due to limited opportunities.
The business, no doubt, is being expended every day in the modern time due to constant expansion in the production technology and this is the reason that the sole proprietorship business has been facing a severe competition with the partnership or the Joint Stock Company business. Nevertheless, the necessity and the significance of the sole proprietorship can't be denied. This is the fact that whatever.

Sense of Absolute Ownership

The profits in the sole proprietorship goes, no doubt, to the lot of the owner but no body comes forward to share the losses therefore, both profits and losses go to the lot of the owner only. Obviously, a rational business man will make his outermost to increase his profits and decrease the losses. Consequently, the owner of the business should take the keen interest to make his business a success. The owner keeps all the raw materials are the process therefore, neither time nor the raw materials are wasted. As a result of personal efforts and vested efforts further. On the country , lack of interest is felt in the joint stock company or the partnership because there is no concept of sense of absolute ownership

Frozen Investment

Partnership suffers from lack of public confidence as it is has no legal existence apart from its partners. The partnership, form is a poor choice from the view point of liquidity and transferability. It is easy to invest in partnership but difficult to withdraw the same. So the investment in partnership from of business is a frozen investment. If a partner dies or retire, the firm in the absence to an agreement to the country., is dissolved when full investment may not realized. Even if the remaining partners or outsiders are willing to purchase the vacated interest, it is often extremely difficult to arrive at a fair price.

Business Secrets

In partnership , the partners themselves handle the business matters the business secrets remain confidential. Business secrets may mean the formulas, the processes, the contracts with suppliers and customers, future planing, sales and production program research results, secret information, and so on. Since there are more than one owner they handle these matters themselves and do not delegate to employee however trusted they may be.

Mode of Payment

Present business world is running on the basis of credit. Goods are purchased on credit by the wholesaler from the manufacturer, retailer purchases on credit from the wholesaler and the final consumer could purchase on credit from the retailer. Credit can be classified into two on the basis of time; short term credit and long term credit. If the buyer purchases on credit and promises to pay soon, he may get concession in price or the price will be fixed at a lower level otherwise higher price will be determined.

Market Size

Market size is also very important factor in economic environment. It help in determining the level of output or productivity. The larger a market is, in terms of customers and purchasing power, the more of a given product can be sold and the more sheerly it can be made by means of blond scale production. This need for a large market exposes why Japan is so keenly interested, in the maintenance of a high degree of freedom in international trade. Other Countries has relatively small national and international market because of quality and price of her produce.s

Level of Productivity

It is the productivity which determines how much labor and capital is requires in a business. Productivity is measured by considering to total amount produced per employee. When we say that there has been an increase in output per labor hour, we do not necessarily mean that increase was caused by labor. The increase in productivity may be the result of the use of improved equipments, skilled workers, better manage or other factors.
For increasing our standard of living we must realize the importance of level of productivity and we must produce more efficiently.

Customers

The purpose if business is to create customers, Without customers,of course a business can not exist. Customers are people who want the product a service a business offer and have the money to buy it. Naturally, business produce what people want and sell it at as low as price as possible. As a result the forces of competition tend to keep price, costs and profits low. But this us not applicable on monopolies.

Joining Small House

Rewards and opportunities are clearly visible and if sized intelligently make you moving to the top in no time but here again one has to be intelligent, hard working and accomplishing to achieve a broad experience in variety of fields to go to the top by sheer will to work hard and competing intelligently, picking up knowledge of purchasing and selling accounting and financing and leading the business well to profitable entity with the of course leadership.

Element od Social Envrionment

Business must live with its environments, social economic, technological, legal , political and it must be alive to its total environments and surroundings and while paying major attention to economics, he must respond to social and other compatible problems as well. Anticipation them well in advance and trough Research and Development be quick in application so that expanding employment opportunities emerges, qualified man power, better houses, congenial sanitary environments with healthy growth may result with adequate lights and comfortable transport.

Business Analysis

Business analysis involves study of pros and cons of the proposed product in the light of market demand, firm's objectives, sales costs and profit as well as the capability to manufacture or produce the product within the stipulated period.

Screening Ideas

Ideas so generated required a through evaluation and study to see whether they match the objectives of the enterprise. Hence in the phase of screening ideas, those that do not match enterprise's objectives are rejected. Further, screening product ideas also involves a general assessment of the enterprise's resources. In the process, the largest number of product ideas are rejected due to their being impracticable, un-realistic, or not as per objective of the enterprise.

Functions of Central Bank

According to DeKock, a Central Bank must perform the following functions:

1. Monopoly of note issue
2. It is Government Bank
3. It is Banker's Bank
4. It is controller of Credit
5. It is the custodian of Foreign Exchange
6. It is the Lender of the last Resorts.
7. Miscellaneous Functions.

• It publishes the financial statements.
• Some Central Bank performs ordinary banking functions.
• It takes every efforts for the development of banking system.
• It has special agricultural credit department to look after rural credit.
  

Use of Business Talents

Business talents can be helpful in solving business problems, but business talents can be borrowed to help deal with social problems, Business need to be innovative,cost conscious concerned with consumers and generally competent and responsible because they have to face competition in the market. If more qualities are used by Government against and universities are might get more and better service from them at lower cost.

Social And Cultural Environment

Every kind of business whether privately or publicity owned must operate within the social and cultural environment. Social environment is built on total population of the country. It is important to study the total population and its composition in the light of gender, age groups, level of educational attainment and income per household. It will help in assessing the type or types of needs of people and their purchasing power, Similarly, cultural environment which his built on attitude, desires, beliefs, customs, habits and practices of people, should be looked in to enable the businessmen determine types of goods that should be made available to them, the services they need and the facilities they are in search of.

Leasing Company

Leasing Companies are those which lease assets to business houses. Insurance companies often purchase building and lease them back to the users, as do many individual investor. It is an important means of obtaining finance which is most commonly used by individual and business in Western Countries and in U.S.A. People rent houses and furniture and business firms rent stores, offices , factory , building and warehouses. A lease is an agreement between the property owner and he uses the property for a specific period. It is a contractual agreement between property owners known as lessor and the user of the said part of the property known as Lessee. In conveys the right to the lessee to use said part or portion of the property for this use for a specific period of time. An essential element of lease deed is that the lesser conveys less that the total interest in the property.

Statutory Company

This company is created by passing some special Act of Parliament, that is by the Government of the country. All the rules and regulations are passed in the form of Act which relates to particular organization for which it is framed and passed. In our country at the beginning when private capital was shy and private persons were afraid investing their money in business, Government took initiative and created National Bank of every country. An industrial Development Corporation like, State Bank , or Head Bank of every country, its functioning is more or less the same as of registered companies Government controls majority of shares them the public. It is created as an artificial person having separate entity.

Transport In International Trade

The establishment and organization of purchases department will depend mostly on the size and nature of big concerns, where generally the volume of purchase is larger, the articles purchased are of various types, and designs, technical and export knowledge is essential on the part of buyers, the price is changing nature etc, a separate and an independent purchasing department is established. But when the concern is small and separated establishment of purchasing in not economically justified,the function of purchasing is either attached with sales or manufacturing department. When the merchandise is purchased with a view to resell them, purchasing may be placed with the seller.

Safety Measure

As precaution is better than cure similarly precautions or the safety measures may proved protection against the business risk. The organization where necessary equipments, generators and alarm system are maintained against the power failure. fire and theft, they minimize the losses through as leakage, power break down, theft , fire etc. In other words, the business risks could be minimized to the minimum through the safety measures.

Forecasting

Some business men are not only intelligent and laborious but are also equipped with characteristic of foreseeing. They are capable to anticipate weather seeing the direction of wind. They remain informed about the future risks like change in the market circumstances, increase in the costs, shortage in the supply to raw materials, price oscillations etc.

Substitute Goods and Services

According to this precautionary method, the organization which produce goods also produces their substitute goods and services so that if the use of fashion of one commodity comes to an end, the losses could be compensated by giving boost to other substitute goods and services. This method could also be used in case of services. For instance the persons or the officer whose services are indispensable for the company, its substitute should be kept ready or the other officer should be provided training in the same line of service so that he must provided protection to the organization against the losses that are possible in case of death or retirement of the original man.

Insurance against the Risk

The organization in the form of insurance companies have come into being which assume the risk to business organization and so the business is freed from the insurance risk. The amount paid as the premium of insurance is much less than the loss which is possible to occur. In the modern age, the amount of premium if insurance is treated as the cost of production.

Creating a Separate Fund

In some of the business lines, the producer creates a separate funds and continues to deposit a certain amount of the annual profits in this fund. Gradually a huge amount is deposited in this fund which could be used to compensate any incidental loss. It should be noted that his fund could be kept on a small level. It is neither suitable nor possible in a big business undertaking to create a separate funds.

Low Investment Policy

Some of business are concerned with the rapidly changing circumstances like the garment business, cosmetics and fashion goods, electronic goods etc. Starting such business it should be seen that what is the minimum investment frontier below which investment can't be curtailed. The volume of losses, in this manner, could be minimized. The investment should be made whatever it should have been.

Mobility of Capital

Commercial banks make the mobility of capital better because the borrowers and lenders come closure. In other words, these banks are the mediators between the debtors and the creditors. Commercial banks collect the money from those who can't use it and provide it to those who possess the ability to use it. The banks, in this way, play crucial role in making the funds mobile from one to other place.

Capital Formation

Commercial Banks are the source of capital formation through promoting the habit to save. Small amounts are converted into the huge funds. When these big amounts are invested, opportunities of maximum use of the country's resources are created due to which the country develops.

Promotion of Investment

Savings that are deposited with the commercial banks are provided to the people as loans so the banks invest. The savers are freed from the problem of investing their funds. In other words, commercial banks make the people free from the investment problem.

Promotion of Saving Habit

Saving take place only when there are opportunities for their investment. If the people have the savings as cash, it will be consumed will not be saved. But if the savings are deposited with the bank, it will be out of sight. Since the deposited amount is out of sight, the people think to consume it late. This attitude of the people becomes the cause of savings. In other words, the banks provide the motivation to the people save.

Labor Union

A Labor Union is an association of the worker formed for the purpose of improving the conditions of employment. The fact about a worker is that an individual worker is poor, ignorant and helpless. So he is in a weak position and cannot bargain with his powerful employer. he tries to pay his workers as small wages as possible without driving them away. The trade union is an organization which aims at strengthening the bargaining power of the workers, by substituting collective for individual action. The underlying principle of the trade union is UNION IS STRENGTH.

Profits Yields Mutual Benefits

Profit yield as to invest . A size able portion of profits go to Government in the form of taxes. The revenue from profits is then used to finance many Government program of social improvement.

Profits as Source of Capital

An important source business also borrow money so that the necessary funds to carry on their opposite they must make enough before profits to pay interest and to save enough from profits to pay debts as they are due.

Profits as Pay for use of Capital

One of the most important and major purposes of capital is to compensate the millions of owners, proprietors, partners or shareholders for the use of the capital they have invested in a business. Profits also must compensate them for taking the risk in them, that capital may be lost should the business fails. If it were not from this hope of compensation, few people would want to invest in a business.

Profit Allocate Resources

It acts as a strong inducement to put resources into those economic operations that serve the public best. By buying what they want at the lowest price, customers who are all of us vote in further of allocating resources in certain ways. In some under developed countries. Government Planners decide how to resources required for production Land, labor capital and so on will be allocated.

Profits as Surplus

Surplus of every business is called Profit. It seems both logical and in the social interest for all managers in any kind of enterprise and at any level in any enterprise, to manage their operations so that their groups will accomplish its purpose at the least cost whether in money, time, effort, discomfort or materials or will accomplish as much of the purposes possible with the resources available.

Business Allowed to make Profits

Profits help bring about efficiency and effectiveness in business operations. They also provide a return on capital invested, create more capital and contribute to Government Tax revenues. Profits are much lower that must people believe, although most people do not believe to be too high.
Some of the important of the term Profits are listed above in every post.

Mail Order Business

The world has now expanded in a way that face to face business become impossible. Development of Communication has solved this problems. Communication and Mail Services by air, sea, and land have provided bright prospects to business circles. For instance, FAX is also a developed form of mail. Since recent past, introduction to business through catalogs, magazines and journals has been followed in all developing and developed countries.

Bank Rate Policy

It is also known as Discount Rate Policy. Bank rate is the rate of interest which is charged by the Central Bank or re-discounting the first class Bills of Exchange and advancing loans against approved securities. This facility is provided to other banks.
When the Bank rate is raised or lowered by the Central Bank all other rates of interests are also raised or lowered by other banks at the same time. If the Central Bank finds at any time, that the prices are rising, it will rise the Bank Rate. This will be followed by the rise in the rates of interest charged by the other banks.

Automation of Production

Computer can control complex industrial processes and even run machine tools. Computer take directions from a blue print and transfer then into instruction that are then feed to machine tools by means of purchased card or magnetic tape.
With the help of computer system we can easily reserve a seat on an airplane, a bed in a hotel or a seat at abase ball game by dialing a telephone number, recording a report of what is available.

Discount Policy

The allowances of discounts or established or list prices for products may be necessary or customary in the trade. Under these conditions, an allowance for discounts should be established prices to be quoted to customers.

Delivered Prices Policy

In those cases when the manufacturer bears the responsibility of delivering the goods to the purchaser, he changes a different price which is called delivery price. This, of course, includes transportation, loading, unloading or other incidental expenses in the base prices of the product. As opposed to this policy is the factory price in which case the manufacturer will be responsible only for loading of the goods on a desired career and other expenses will be bored by the purchaser.

Nominal Partners

A person who is not a partner but who lends his name out as partner, becomes liable as a partner to those, who on the faith of this representation being a credit to the form. The person is fixed with the liability of a partner to prevent frauds to which creditors would liable. When a person, in such a manner, holds himself out as a partner or allows others to do so. he is then assumed and be is known as a nominal partner, a partner be stopple or a quasi partner. Such a partner, becomes liable for that transaction, but he is not entitled to any right against those who are, in fact, partners in the form, for which his name has been utilized.

Accounting and Finance

This is most interesting and offer promising career in business. The accounting and finance area afford a chance to look at the business opportunities as a whole and to see how they fit together. All operations and business activities boost down to money, a common domination and judge then viability. Man of money in all operations and phase.

Purchasing

Buying a wide range of machinery, materials, supplies, parts and components , has become a very important area of business. People in purchasing, because of their close relationship to suppliers, are also an important pipeline of the information on new products and development that may be beneficial to their company. Thus good opportunities for young persons do exist in this field of business also.

Information and Processing

Information are vital for the success of a business firm. In fact, to manage a business is to manage information. The introduction of computer has created the need for a new kind of specialists. There must be some one who knows how to release a computer program to the specific need of business.

Engineering and Research

As products and services have become more complex and based on a advanced sciences, engineering and research opportunities exist in almost every kind of business enterprise. Opportunities for young persons are wide open in this field as businessmen no longer look for an Edison is great. Inventor Thomas Edison who was not a Graduate.

Marketing and Sales

In modern World marketing and sales have assumed a wonder popularity. Now a days many enterprises required salesmen. It requires persons who can study and analyze customers behavior, market, competitors and prices. Sales and marketing people are usually major link between a company and the outside world.

Different Field of Business

Opportunities in business operations be scatted in marketing and sales, engineering and research, production and information processing, purchasing, accounting and financing and in business management and young graduates expect power, prestige and financial reward which motivate them in any of these phases. Let is briefly discuss each of these areas and then divide the career.

Social Mission and Opputunity

There is no denying the fact that "Social Mission of Business is to produce goods and services of economic nature." Its foremost mission is to satisfy customers in predominant or what the customers require at low prices and with the experience of the high profits represents difficult and challenging opportunities to every one involved in business.
Social mission of business is not restricted to the act of providing goods and services required by the society. In fact, social mission and opportunities go well together. It is the business which brings changes in cultural heritage by bringing changes in tastes and fashion of people of an orthodox or conservative society. It is the business which brings change in cultural heritage by bringing changes in taste and fashion of people of a orthodox and conservative society. It is the business which sometimes changes the outlook of the entire nation. Apart from profit motive a businessmen can serve the society in many ways with missionary zeal and favors.

Maintenance of Record

Different information regarding the price source of supply, quotation purchasing order etc, are required to be kept for proper purchase routine. A separate file for each information is maintained in order to avoid the repetition of all steps every time. There is no need of asking for quotation, finding out the source of supply etc, if proper records have been maintained which is simply referred as and when they are required.

Placing of Order

As soon as the vendor or vendors have been selected the next step is to prepare the purchase order. Purchase order being an agreement to buy the material should very carefully be drawn. All the positive information relating the material is mentioned in the purchase order as:

1. Description of Quantity
2. Quantity
3. Delivery Date
4. Place of Delivery
5. Order Number
6. Discount and Billing Terms

Requisition if Material

The need for purchasing the articles does not originate in the purchased department. Different departments, such as producing, engineering, sales etc, require materials tools and various articles which must be communicated to the purchase department. It is through this requisition that the purchases department is informed and asked to purchase the material thereof. Heads of departments are authorized to prepare the requisition which contain such information as the (1) Name and the description of Material (2) The Quantity (3) The Time of Delivery (4) The place to which it is delivered. This report must be signed by the requisition.

Good Purchasing System

The establishment and organization of purchases department will depend mostly on the size and nature of big concerns, where generally the volume of purchase is larger, the articles purchased are of various types , and design , technical and export knowledge is essential on the part of buyers, the price is changing nature etc, a separate and an independent purchasing department is established. But when the concern is small and separate establishment of purchasing is either attached with sales or manufacturing department. When the merchandise is purchased with a view to resell them, purchasing may be placed with the seller, If the articles purchased are meant for producing certain finished goods purchasing may be put under the control of manufacturing department.

Market Financing

Financial assistance is not only required by the consumers in the form of credit facilities from the distributors but also required by the wholesalers, retailers, middlemen and manufactures. Wholesalers provide finance to the retailers by selling commodities in credit. Manufacturer extend credit to the wholesaler and retailer provided credit to the consumers. Banks and financial institutions may also provide the help of financing the market at different stages wherever required.

Standardization and Grading

Standardization is defined as : the determination of basic limit or grades in the form of specification to which manufactured goods must confirm and classes into which the products of agriculture and extractive industries may be stored. Grading is the process of sorting units of a product, into the grades or classes that have been established through the process if standardization.

The Function of Physical Supply

Transportation: This is one of the most important functions of marketing which involves the physical transfer of commodities from the place of production to the place of consumption. It creates place utility and makes available the goods when they are in greater demand.

Warehousing: The transfer of goods from the place of production to the consumers necessitates a great deal of physical handling. Goods must be stored either at the premises of the production or on those of middle men and eventually they must, of course, be transferred to the consumer.

The Functions of Exchange

Buying : Buying which includes transfer of title is the marketing function of controlling and concentrating goods to facilitates sales, purchase, production or uses. Buying involves on the part of the purchaser, a determination of the kind, quality , quantity, time and price of goods to be bought.

Selling: One of the most important functions of the modern production is that of establishing a market for his products. Selling refers its transfer of the title to a commodity.
Selling is (a) Personal , or (b) Impersonal

Personal selling is oral presentation in conversation with one or more prospective customers for the purpose of market sale.

Impersonal selling refers to advertising and sale promotions.

Marketing

Marketing concepts , importance, Marketing Mix. Product and its types, product life cycle. Channels of distribution for consumer and industrial goods. Market Segmentation , Sales promotion and advertising , warehousing , Wholesaling and Retailing , Middlemen Role and classification Pricing decision and strategy.

Content of Business

Nature, scope and importance. Problems of business functions and qualities of businessman. Business environment and social responsibility. Role of business in economics systems. Business under private and public ownership.