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Published on: 13/05/2022
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Questions + Answers key
Take MCQ Commerce Test1.
Explain the merits of Foreign Trade.
2.
Mr. Kovalan completed his M.Com. degree and proposed to start a business dealing powerloom machines. After a complete analysis, it was found that it is better to buy from foreign countries than to buy from domestic manufacturers. So what is your opinion whether to purchase from foreign countries or from domestic manufacturers.
3.
Explain the types of Internal Trade
4.
Give an account of India's Important Export and Import items.
5.
What is Internal Trade? What are its Types? Explain.
1.
Merits of International Trade.
(i) Leads to specialization:
People trade because it is profitable. When goods are produced on large scale, it promotes the productive ability in terms of labor efficiency and other available resources. This, in turn, leads to. specialization and encourage the production of different types of goods in various countries.
(ii) Increase in consumption capacity:
Foreign trade enables a country to get goods which it cannot produce and enlarges a country's consumption capacity, increasing world output. In other words, trade is an 'Engine of Growth'.
(iii) Provides benefits of large-scale production:
Goods are produced for the world economy, hence resources are fully utilized and all the economies of Large-Scale production are enjoyed by the producer country.
(iv) Stabilise prices and promote international equality:
Foreign trade equalizes the prices of goods throughout the world. With the help of E-commerce, information reaches every work and corner in a fraction of a minute. Foreign trade enables the consumer to get good quality products at lesser prices all over the world.
(v) Encourages fuller utilization:
Due to better production methods, every country can produce goods by fully utilization of installed capacity. Wastes are reduced. As a result cost of production falls and prices are cheaper.
(vi) Exchange of know-how and establishment of new industries:
A developed country can provide all types of technical know-how, machinery and equipment to the developing countries. This helps in the establishment of new industries in the importing countries.
(vii) Increase employment opportunities:
The establishment of new industries under foreign collaborations create employment opportunities in the country.
(viii) Development of communication and transport facilities:
The International Trade brings people of different countries together, With the help of internet valuable information is exchanged between different countries. It also. leads to. the development of means of transportation.
(ix) Promotes International Understanding:
Better relationships among trading countries are established. This promotes mutual help, understanding of each other's problems and promotion of world peace.
2.
In my opinion; if he purchases from foreign countries, it will be a quality one. It will work a long time. First of all he should get the quotation from all countries. He can choose which is the low cost and high quality machines. A very good brand also can be chosen.
3.
Home trade consists of two main subdivisions namely
Wholesale trade:
"Purchase of goods In bulk from the manufacturers and selling them in smaller quantities to other intermediaries" IS known wholesale trade.
Retail Trade:
Retail trade deals with the distribution of goods in small quantities to the consumers.
4.
India's important Import items.
i) Minerals, fuels including oil.,
ii) Gems, precious metals.
ii) Electrical machinery and equipments.
iv) Machinery including computers.
v) Organic chemicals.
India's important Export items
i) Petroleum products.
ii) Jewellery.
iii) Automobile.
iv) Bio-chemicals.
v) Pharmaceuticals.
5.
Internal Trade is the Buying and Selling of goods and Services within the boundaries of a nation. It is also known as Home trade / Inland trade / Domestic trade.
Types of Internal Trade:
The Internal trade may be, divided into Two types :
(i) Wholesale trade
(ii) Retail trade
(i) Wholesale trade :
(1) Wholesale trade refers to Buying and Selling of goods and services in large quantities for the purpose of resale. The trader who deals in wholesale trade is known as Wholesale traders.
(2) Wholesaler buy the goods directly from the manufacturers in bulk and sell them in relatively smaller quantities to the larger number of retailers.
(3) Therefore, they serve as an important link between manufacturers and retailers.
(ii) Retail Trade:
Retail trade refers to Buying of goods and services in relatively small quantities from the wholesaler and selling them to the ultimate consumers. The traders who deal in retail trade are known as retailers.
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Tamilnadu Stateboard 11th Standard Subjects

Maths

Commerce

Economics

Biology

Business Maths and Statistics

Accountancy

Computer Science

Physics

Chemistry

Maths

Biology

Economics

Physics

Chemistry

History

Business Maths and Statistics

Computer Science

Accountancy

Computer Applications

History

Computer Technology

Commerce

Computer Applications

Computer Technology

Tamil

English

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Tamilnadu Stateboard Standards