Understanding Commerce

Study Notes

Commerce is the structured process of exchanging products or services, incorporating monetary aspects and logistics.
It involves the exchange of goods and services among multiple parties, emphasizing large-scale buying and selling.
The field of commerce investigates income generation, spending habits, production methods, and the influence of regulations on commercial behaviors.

Consumer: An individual who purchases goods and services to meet their needs and desires.
E-commerce: Buying and selling goods or services over the Internet by businesses and consumers.
Trade: The act of selling and exchanging goods between parties.
Industry: Economic activities focused on the production of goods and services.
Consumer Needs vs. Wants:
- Needs are essential for survival (e.g., food, shelter).
- Wants are non-essential desires (e.g., luxury items).

Resources: Inputs used in the production of goods and services.
Scarcity: Limited availability of a product, leading to insufficient supply to satisfy demand.
Choice: Making decisions when presented with alternatives.
Opportunity Cost: The value of the next best alternative foregone when a choice is made.
Income: Regular earnings received from various sources, including employment and investments.

Describes spontaneous purchases made without thorough consideration.
Impulse buying can lead to financial waste and unsatisfactory transactions.
Factors to evaluate before a purchase include desire, affordability, and available alternatives.

Establishing a financial plan is vital for maximizing satisfaction from income, requiring tracking of income and expenses.

Caveat Emptor: Latin phrase meaning "let the buyer beware," highlighting buyer responsibility to understand purchase risks.
Garnishee Order: A legal directive allowing creditors to collect debts from a debtor’s income or properties.
Writ of Execution: Court order enabling seizure of debtor's assets for debt recovery.
Bankruptcy: Legal process providing relief for individuals unable to repay debts, potentially involving asset liquidation to settle obligations.

Resources utilized for meeting needs and wants are categorized into:
- Land: Natural resources like minerals, forests, and agricultural land.
- Labour: Human effort in production processes, including physical and intellectual contributions.