FORM ONE COMMERCE ALL TOPICS

THE SCOPE OF COMMERCE

Definition of commerce; 

Commerce is the study of exchange and nglish-swahili/distribution” target=”_blank”>distribution of goods and services from the point of production to the point of consumption to satisfy human wants. 

AIM; 

To bridge the gap between the producers and consumers. 

TERMS; 

1. Goods– are things which we can see and touch. Example; pen, books, tractor etc. 

2.Services  -are things which we can’t see and touch but help in progress of life. Example; education, hair dressing, medical care etc. 

1. Needs –are necessary things for man in order for man to live he needs food, shelter and clothes. 
   
2. Wants-are not essential things to man in order for man to be happy in life and enjoy the life he want. TV, radio, car, mobile phone. 
   
3. Distribution–The term nglish-swahili/distribution” target=”_blank”>distribution involves various ways of making goods and services available to the final consumer. 
   
4. Exchange 
   

 

edu.uptymez.com

• The term exchange involves buying and selling of goods and services 
  
• Exchange constitute TRADE 
  
• This exchange can be through money as medium of exchange. 
  

 

edu.uptymez.com

1. Producer or seller      â”€Anyone who works for payment (money)      â”€Example;-Doctors, teachers, farmers, shopkeepers 
   
2. Consumer or buyer 
   

      â”€Anyone who buys goods or services    â”€We are all consumers 
   

   BASIC HUMAN WANTS (NEEDS) 
   

   i.)Food ii.)Clothes iii.)Shelter 
   

   CHARACTERISTICS OF HUMAN WANTS 
   

   i.) Unlimited ii.) Satisfied iii.) Complementary iv.) Competitive 
   

   v.) Alternative 
   

        i.) UNLIMITED 
   

   Our wants are unlimited. We will always want more E.g. Mr. Patel wants to buy a shirt. He also wants a trouser. After he has brought some trousers he will want a pair of shoes and so on. 
   

        ii.) SATISFIED 
   

   -We cannot satisfy all our wants, but we can satisfy some of wants 
   

   -If you don’t have enough money you can’t buy everything you want but you can satisfy a certain want. 
   

        iii.) COMPLEMENTARY 
   

   -Things which go together that means if you want one thing you also want another thing. 
   

                Example;   -Car  Petrol 
   

                                -Radio  Batteries 
   

                                -Tea  Sugar 
   

         iv.) COMPETITIVE 
   

   -We want many things but we can’t buy them all now. So we choose the one we want very much. Choice is among the thing we require most against the other. 
   

         v.) ALTERNATIVE 
   

   -There are different ways in which we can achieve or get what we want. Our wants have alternative. 
   

            Example; – by plane train 
   

                             -Butter cheese 
   

                            -Tea coffee 
   

                              -Pen pencil 
   

      IMPORTANCE OF STUDYING COMMERCE OR WHY 
   

   SHOULD COMMERCE BE STUDIED 
   

   i.)The study of commerce exposes the business world to students. 
   

   ii.) It simplifies the understanding of modern commercial methods.
   

   E.g. export/import goods and services to/from other countries using different units of currency. 
   

   iii.) To know frequent changes which happen in commercial world and its effect to the public. 
   

   iv.) It enables both consumers and businessmen to know different marketing techniques i.e pricing, discounting, promotions. Etc 
   

   v.) It is useful for future specialization vi.) Every individual is involved in commerce vii.) It also enables students to understand pre-introduction of economic concept. 
   

                        Assignment              1. Explain the following 
   

                    a.) Human wants 
   

                     b.)Human needs 
   

                2. Explain the basic human needs. 
   

                        DIVISIONS OF COMMERCE/ BRANCHES OF 
   

   COMMERCE 
   

                  Commerce is divided into two main branches; 
   

   1. Trade 
      
   2. Aids to trade 
      

      Divisions of commerce are summarized in the figure below; 
      

    

   edu.uptymez.com

 

edu.uptymez.com

i.)TRADE 

-Trade refers to buying and selling of goods and services with the aim of generating profit. 

-Trade is the basic commercial activity which deals with the exchange of goods with goods or goods with money. 

-A person who engages in trading activities is known as a Trader. -Trade is subdivided into two main branches; 

   a.) Home trade 

   b.) International trade (foreign trade) 

   HOME TRADE 

Is the buying and selling of goods or services within a country -Home trade is divided into two main branches; 

             a.)Retail trade 

             b.)Wholesale trade 

I.)RETAIL TRADE 

   -Is the buying of goods from producers or wholesalers and selling them in small quantities to the final consumer. 

II.) WHOLESALE TRADE 

-Is the buying of goods in large quantities from producers or manufacturers and selling in small quantities to the retailers. 

INTERNATIONAL TRADE (FOREIGN TRADE) 

-Is the trade between one nation and other nations. -International trade is divided into two types; 

                         i.)Export trade                            ii.)Import trade 

I.)EXPORT TRADE 

-It is the selling of goods and services to other countries 

II.)IMPORT TRADE 

-It is the buying of goods from other countries. 

           2. AIDS TO TRADE 

– Are those services which help trade to take place smoothly. 

-Aids to trade make trade less difficult to carry out. 

Examples of aids to trade including the following;- 

           a.)Transportation 

-This refers to the movement of physical goods and people from one place to another or 

-Is the movement of goods from areas of production to the area of Consumption.  

           b.)Communication 

-Is the transmission of information from one point or person to another point or person. 

           c.)Warehousing  

-This refers to the storing of goods so that they are made available when and where they are required. 

           d.)Banking/Finance 

-This includes the provision and management of money and credit necessary to transfer goods to the final consumer. 

           e.)Insurance 

-This refers to the protection against risks like fire and theft. 

             f.)Advertising 

-This is the art of making goods and services to be known to the public. 

         HISTORICAL DEVELOPMENT OF COMMERCE IN TANZANIA 

-During the ancient time (Stone Age, primitive communalism) commerce did not exist in Tanzania. 

-People lived by collecting wild fruits, digging roots and hunting animals by the use of stones. 

They didn’t have any want to satisfy their needs which was beyond the ability of a family or clan i.e. each family was self-sufficient and self-reliant. In other words there was no social division of labour and specialization. 

-As time went on FIRE was discovered with the discovery of fire people started melting iron and making spears, arrows and hoes. 

-After that, the developed group of people who used spears, arrows and bows for hunting wild animals, these were called HUNTERS while those who used hoes for cultivating were called FARMERS. So it means people performed different jobs. This was the development of DIVISION OF LABOUR because each group performed different jobs and also those were the early stages of SPECIALIZATION, INTERDEPENDENCE and DIVISION OF LABOUR. 

-Now people began exchanging commodities produced by others. 

-This exchange of goods was known as BARTER TRADE. 

-This was the early stage of Barter Trade in Tanzania.