CAPITOLO 1
COMMERCE AND TRADE
Commerce: is a general term for to describe the sale and distribution of goods, for example history of
commerce and chamber of commerce.
Trade is the commercial activity of buying and selling goods and services, many divided in two categories,
home trade and foreign trade for to the place and for to the quantity of goods and services sold and bought,
wholesaler and retailer (wholesaler buy many a big quantity of goods and retailer buy and selling in small
quantity of goods.
Home trade, when goods and services are sold and bought inside a country
Foreign trade is a commerce between two different countries and can be distinguish in import when goods
or services are bought from a foreign seller and export when the goods are exported in other country.
CHANNELS OF DISTRIBUTION
The first is the channel direct from the manufacturer to the consumer, end the second channel is the
manufacturer from the consumer through a wholesaler, the third is from the manufacturer to the consumer
through the wholesaler and retailer, and the finally from the manufacture to the retailer and the consumer.
Each channels in the distribution chain makes the cost of the product higher for the consumer, because there
are transportation, insurance and advertising.
Now Many businesses Trying to cut these costs thanks to the internet and e-commerce that enable to
advertise and promote their products and services directly to buyers, for example Zalando.
THE FOUR FACTORS OF PRODUCTION
The factors of production are used to produce goods and services.
The most important are :
Natural resources: for examples water, vegetation, and they cannot be replaced easly, the wood for a table
Labour: that is the "Human resources" that to produce goods and services
Capital: is used to buy natural resorces and to pay for human resources
Entrepreneurship: where there is a entrepreneur that control the business activity and gestisce gli altri fattori
THE THREE SECTORS OF PRODUCTION
Primary sectors: includes the natural resources of the territory for examples : farming, mining, fishing (that is
catching food from seas), forestry (that is managing forests for wood production)
Secondary sector: This sector take the raw materials and trasform that into goods
Tertiary sector: Involves the provision of services to final consumers and businesses as education or banking.
TYPES OF ECONOMY
There are different types of economy, the three most important are:
Planned economy:
In this type of economy he state makes the main deciion about what will be produce and in what quantities,
at what price it wil be sold, and who will benefit from the sale of the products or services. Plannes economy
are associated with communism for examples this communism exist in Cuba
Free market economy: This is the "capitalist system" where the main decisions about production and prices
are established by the economics of supply and demand. For examples Japan and the USA.
Mixed economy as Italy, where Private companies are free to complete for most goods and services, but the
government provides other services such as public transport and education.
