Economic activities are of the following types:
Business includes all those economic activities which are concerned with production and exchange of goods or services with the object of earning profits.
Business is an economic activity because it is undertaken for earning money and producing wealth. Business creates various types of utilities by making goods and services more valuable and useful to consumers.
When raw materials are converted into finished products, it creates form utility. Place utility is created by transporting goods from the place of production to the place of consumption.
Goods are stored for future use which results in the creation of time utility. A factory, a shop, a transport company, a warehouse, an insurance company, a bank – are all examples of business activity.
Profession is an occupation which involves the rendering of personal services of a specialised nature. The service is based on professional education, training and experience. Chartered accountancy, medicine, law are examples of profession. The main features of a profession are as under:
(i) Rendering of personal service of an expert nature.
(ii) Providing specialised service for a professional fee charged from the clients.
(iii) Minimum qualifications prescribed for a profession to be acquired through formal education and training.
(iv) Professionals are members of a professional body e.g., the Institute of Chartered Accountants of India.
(v) The professional body lays down code of conduct. Its members must obey the prescribed guidelines and regulations.
3. Employment or service:
A person is said to be in employment or in service when he undertakes to render personal services under an agreement of employment. The service is rendered for a wage or salary and other benefits attached to the job.
There exists a relationship of employer and employee. The employer may be a government department/undertaking or a private organisation.
The professionally qualified persons are also in employment in various organisations. A teacher, a clerk, a soldier, a government officer are some of the examples of employment or service.