Business: Definition and Objective

Definition of Business

• Business is an institution organized and operated to provide goods and services to society under the incentive of private gain.
• It involves economic activities performed for earning profits, primarily for the benefit of those on whose behalf the activity is conducted.
• Business can be defined as any enterprise that makes, distributes, or provides goods and services for private profits.
• It includes activities involved in the production and distribution of goods and services for private profits.

Characteristics of Business

• Creation of utilities: Business adds time, place, form, and possession utilities to goods, making them more useful to satisfy human wants.
• Business enables people to satisfy their wants more effectively and economically.
• It carries goods from places of surplus to places of scarcity (place utility).
• It makes goods available for use in the future through storage (time utility).
• Dealings in goods and services: Business involves the production and distribution of goods and services.
• Goods can be classified as consumer goods (meant for direct use by the ultimate consumer) or producer goods (used for production of consumer or capital goods).
• Services, like transport, warehousing, banking, and insurance, facilitate buying and selling of goods by overcoming various hindrances in trade.
• Services are intangible and invisible goods that facilitate the exchange of goods and services.

This quiz covers the definition and objective of business, including its organization, operation, and incentive structure.