Why is business considered as economic activity?
Business is considered an economic activity because it has got the following features:
1. Profit Motive: Business means production, purchase and sale of goods with profit motive. Earning profit for satisfying needs make the business an economic activity.
2. Business activities require use of scarce resources: To run business concern the owner must have adequate capital, raw materials and skilled workers. Business requires sufficient funds to be invested in it. All these activities involve monetary transactions. So business is an economic activity.
3. Satisfying human wants: business is a source of income for businessmen and their families. Business can, therefore, be regarded as an economic activity not only as a means of earning income by businessmen but also as a means of satisfying the wants of people.
NCERT questions are designed to test your understanding of the concepts and theories discussed in the chapter. Here are some tips to help you answer NCERT questions effectively:
Welcome to the NCERT Solutions for Class 11 Business Studies - Chapter . This page offers a step-by-step solution to the specific question from Excercise 1 , Question 7: Why is business considered as economic activity?....
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