In this class, we will discuss the meaning, scope, and functions of commerce.
Meaning, Scope, and Functions of Commerce
OUTLINE
The Importance of Commerce
History of Commerce in Nigeria /West Africa
Divisions of Commerce
Definition of commerce
Commerce is the study of the production, distribution, and exchange of goods and services aimed at satisfying human wants and earning a living.
The importance (functions) of commerce
1. It provides employment opportunities for people.
2. It makes the production and exchange of goods and services possible.
3. It improves the standard of living of people by making modern goods available.
4. It aids national and international co-operation by ensuring the inter-dependence of nations.
5. It facilitates the division of labour and specialization.
6. It brings technological innovation and aids infrastructural development.
Stages in the history and development of commerce
(i) Earliest time: – Production was subsistent.
(ii) Exchange of goods and services by barter.
(iii) Exchange of goods and services through the use of commodity money.
(iv) Introduction of money–notes and coins as a medium of exchange
(v) Improvement in aids to trade.
Self-evaluation:
1. What is Commerce?
2. State four functions of Commerce.
Factors that delayed the development of commerce in Nigeria/West Africa
1. Political instability
2. Low savings
3. Absence of developed markets
4. Poor communication system
5. Illiteracy
6. Inadequate capital
7. Low level of technology
8. Inadequate infrastructural facilities / poor infrastructural facilities
9. Low National income
Factors that have contributed to the growth of commerce in Nigeria/West Africa
1. Development of modern techniques of production
2. Political stability
3. Development of financial institutions
4. Development of efficient means of transportation and communication
5. Availability of warehousing facilities
6. Improvements in aids to trade,e.g., Insurance, Advertising, etc
7. Advancement in levels of education/literacy
Divisions of Commerce
Commerce can be grouped into two main branches or divisions, namely:
1. Trade
2. Aids to trade
The aids to trade can be subdivided into:
(a) Transport (b) Insurance (c) Banking and Finance (d) Advertising
(e) Warehousing (f) Communication (g) Tourism
Self-evaluation:
1. Why is Commerce so essential to modern society?
2. Set out carefully the principal divisions of Commerce and give an idea of the
relative importance of each division.
General self-evaluation:
1. What is Commerce?
2. State and explain the importance of any five ancillary services to trade.
3. Give any five advantages of advertising.
4. State five ways in which warehousing is useful to businessmen.
5. In what ways does transport aid trade.
Theory
1. State three ancillary services to trade.
2. Mention three ways by which transport aids trade.
We hope you enjoyed the class.
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