Business activities play a crucial role in economic development. They contribute to the economy by generating employment opportunities, increasing production and consumption, and contributing to the GDP of the nation. Trading activities have historical significance and have led to surplus income generation, aids to trade, and the growth of industries. Business activities also drive profit earning, risk-taking behaviour, and the creation of employment opportunities. Additionally, business activities have led to economic reforms and liberalisation policies that promote economic growth, foreign trade, and technological advancements. Businesses also have objectives beyond maximising profit, including social responsibility, reputation, innovation, productivity, and long-term sustainability. They contribute to economic development by creating job opportunities, generating income, fostering innovation and technological advancements, contributing to tax revenue, earning foreign exchange, mobilising investment, and promoting economic diversification.
Concept of business.
Business starts with production and end with consumption. Production of goods comes under industry and other allied activities comes under commerce. In a nutshell we call them ‘Business’ which is a wider term and includes Industry, trade and commerce .
However, in a specific sense, business refers to an occupation in which people regularly engage in activities related to purchase, production and/or sale of goods and services with a view to earning profits.
Objectives of business
One of the main purpose of business is to earn income by way of profit. No business can survive for long without profit. That is why, businessmen make all possible efforts to maximise profits, by increasing the volume of sales or reducing costs.
An objective is the starting point of business. Every business is directed to the achievement of certain objectives. Every business is said to be an attempt on the part of business people to get more than what has been spent or invested, or in other words, to earn profit which is the excess of revenue over cost. Marinating goodwill and reputation of ones’ business is paramount to succeed and prosper. A business enterprise must aim at standing on stronger footing in terms of offering competitive products at reasonable prices to its customers and serving them to their satisfaction. customer satisfaction as a critical factor in the success of a business. Understanding customer needs and preferences, delivering high-quality products or services, and providing excellent customer service is essential for satisfying the customers. Market share refers to the proportion of a market that a business serves. Increasing market share, expanding the business’s customer base, and becoming a leader in the market is one of the main objective of any business. Social responsibility and sustainability helps in improving the rapport of the firm this objectives delineate businesses’ social responsibility to operate ethically and sustainably.
What is GDP? GROSS DOMESTIC PRODUCT
GDP can be calculated by adding up all of the money spent by consumers, businesses, and the government in a given period.It may also be calculated by adding up all of the money received by all the participants in the economy.
GDP at Current Prices in the year 2023-24 is estimated at ₹293.90 lakh crore, against the FRE of GDP for the year 2022-23 of ₹269.50 lakh crore. The growth in nominal GDP during 2023-24 is estimated at 9.1 per cent as compared to 14.2 per cent in 2022-23.
CONTRIBUTION OF FDI IN ECONOMIC DEVELOPMENT
The Indian economy is emerging as one of the faster growing economies in the world today and a preferred FDI destination. Rising incomes, savings, investment opportunities, increased domestic consumption and younger population ensures growth for decades to come. The high growth sectors have been identified, which are likely to grow at a rapid pace and the recent initiatives of the Government of India such as ‘Make in India’, Skill India’, ‘Digital India’ is expected to help the economy in terms of exports and imports with steady and sustainable trade balance.
FDI refers to foreign direct investment from a source country into a destination country for the purpose of exporting to a third country.In 2022, India ranked 10th in top destinations for foreign direct investment (FDI), a culmination of decades of economic and policy reforms.
The United States has been ranked as the top destination for foreign direct investment for the 12th consecutive year according to Kearney's Global Business Policy Council's 2024 Foreign Direct Investment (FDI) Confidence Index .
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