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Questions and Answers
Define commerce and explain its importance in the distribution of goods and services.
Commerce is the large-scale organized system of activities, functions, procedures, and institutions that contribute to the smooth distribution and transfer of goods and services. It is important for ensuring goods and services reach the right time, place, quantity, quality, and price within local, regional, national, or international economies.
What are the principal factors that give rise to commercial exchanges?
The principal factors that give rise to commercial exchanges are the diversity in the distribution of natural resources, differences of human needs and wants, and division of labor along with comparative advantage.
What does trade encompass in the context of commerce?
In the context of commerce, trade encompasses the exchange of goods and services between buyers and sellers, including domestic trade (retail, wholesale, local, regional, and inter-regional transactions) and foreign trade (import, export, and entrepôt/re-export trades).
What are the auxiliary commercial activities that facilitate trade within the commerce system?
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Explain the role of aids to trade in the overall commerce system.
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