Question

Explain any two business activities which are auxiliaries to trade.

Answer 1

(a) Transportation : Refers to the physical means used to transfer person, goods from one place to another. It facilitates transfer of labour, raw-material, finished goods from one place to another. Transportation creates place utility and removes hindrance of place.

(b) Banking and Finance: A business requires finance for its establishment, modernisation and diversification expansion and growth and to meet day to day expenses. Banks and financial institutions provide finance to the needy business concerns. Therefore banking and financing remove hindrance of finance to enable smooth functioning of business.