Continuous increase in the profits of any enterprise is possible only by performing useful services to the society. Infact, objectives are needed in every area that influences the survival and prosperity of busi¬ness. Since a business has to balance a number of needs and goals, it requires multiple objectives.
The five multiple objectives of business are as follows:

1. Market standing : Market standing refers to the position of an enterprise in relation to its competitors. A business enterprise must aim at stronger market standing in terms of offering competitive products to its customers and serving them to their satisfaction.
2. Innovation : Innovation is the introduction of new ideas or methods in the way something is done or made. There are two kinds of innovation in every business, i.e.,
   (i) innovation in product or service.
   (ii) innovation in the various skills and activities needed to supply them.
3. Productivity : Productivity is calculated by comparing the value of outputs with the value of inputs. It is used as a measure of efficiency.
4. Physical and financial resources : Any business requires physical resources like plants, machines, offices, etc., and financial resources i.e. funds to be able to produce and supply goods and services to its
   customers.
5. Earning profits : One of the main objectives of business is to earn profits on the capital employed.
   Profitability refers to profit in relation to capital investment. Every business must earn a reasonable profit which is crucial for its survival and growth

PRIVATE SECTOR ENTERPRISES

The private sector consists of business owned by individuals or a group of individuals. The varios forms of organisation are- sole proprietorship, partnership, joint hindu family, cooperative and company.

PUBLIC SECTOR ENTERPRISES

Meaning: The public sector consists of various organizations owned and managed by central or State or by both governments. The govt. participates in economic activity of the country through these enterprises.

A company abides by the new regulations regarding payment of taxes in India. It is performing its social responsibility towards the government

Social responsibility of business towards government’s regulatory bodies or agencies is quite sensitive from the license point of view. If permission is not granted or revoked abruptly, it can result in huge losses to an organization. Therefore, compliance in this regard is necessary.
Furthermore, a business must also function within the demarcation of rules and policies as formulated from time to time by the government of state or nation. It should respect laws and abide by all established regulations while performing within the jurisdiction of state.
Some examples of activities a business can do in this regard:

• Paying fair taxes on time,
•  Following labor, environmental and other laws, etc.
• Seeking permissions wherever necessary,
• Licensing an organization,

Which of the following is not a characteristics of Business?

(a) Dealing in goods-in-trade.
(b) A father teaching his son.
(c) Involves risk and uncertainty of income.
(d) Aims at earning profits

Answer:

b) A father teaching his son

Explanation:

Business refers to the part of the occupation where the main objective becomes earning profit. It also refers to the supply of goods that satisfy customer needs. It involves the purchase of goods or sales.

The characteristics of Business are :

* It only aims at earning profit.

* It involves dealing goods in trade.

* It may involve risk and uncertainty in income.

* Production of goods.

So option b) A father teaching son is not a characteristic of business.

Services : Services are all those economic activities that are intangible and imply an interaction to be realised between service provider and consumer.

The Peculiar feature of construction industry is that it is always initiated by clients, opposite to most of the other industries. The other industries first produces the goods to meet the supply of the customers. But in a construction the request or the specifications are raised by the clients.

Q :

Different situations in different business are being elaborated below:-
(i) Raghunath Gorkha had a match stick factory in Nepal which got distructed by the recent earthquake.

Answer:

Causes of business risk identified in the above cases are as follows:--

1. Natural causes: Human beings have little or no control over natural calamities like flood, earthquake, lightning, heavy rains, famine, etc. A person can only  talk about them and can not say when they will definitely occur. These natural calamities result in heavy loss of life, property and income in business.

2. Human causes: Human causes include such unexpected events as dishonesty, carelessness or negligence of employer/employees, stoppage of work due to power failure, strikes, riots, management inefficiency, etc.
 

When a company specialises in a particular operation such as preparation of financial statements  and performs this task for various industries in the market. It is referred to as horizontal outsourcing. 

While, when a company performs more than one task for other one or two industries in the market. It is referred to as vertical outsourcing. 

Indian Depository Receipt- IDR is a financial instrument. It is issued  by domestic depository to the Indian citizens against the shares of foreign company. IDR is denominated in Indian rupees. It helps issuing company, i.e. foreign companies to raise capital from Indian securities market.

Global Depository Receipt- GDR is issued by a country's bank against the shares of a foreign company which is not traded in their domestic stock exchange. GDR is issued in more than one country. It is a negotiable instrument.

American Depository Receipt- ADR is a negotiable instrument. It is issued by American Bank against the shares of foreign company that are traded in U.S. Stock market. ADR is denominated in US Dollars. 

Economic Activities Activities which are under taken by people with the object of earning money are known as economic activities. e.g., production of goods in 8 factory, distribution of goods by a wholesaler or retailer

Emerging modes of business refers to recent changes that have taken place & will take place in a manner or mode of conducting a business. E-business, outsourcing, internationalisation & globalisation are the three dynamic trends that are shaping business in today’s world.

Entrepreneur plays an important role in the nation’s development:

• Increase in the rate of growth in GDP (Total value of goods and services produced in an economy in a year),
• Increasing productivity,
• Providing employment opportunities,
• Increasing economic diversification,
• Optimal use of available resources,
• Continued innovation in techno-managerial practices and finally international competitiveness.

Principle of Subrogation

Subrogation means one party stands in for another. As per this principle, After the insured, i.e. the individual has been compensated for the incurred loss to him on the subject matter that was insured, the rights of the ownership of that property goes to the insurer, i.e. the company.

Subrogation gives the right to the insurance company to claim the amount of loss from the third-party responsible for the same.

Example – If Mr A gets injured in a road accident, due to reckless driving of a third party, the company with which Mr A took the accidental insurance will compensate the loss occurred to Mr A and will also sue the third party to recover the money paid as claim. 

A Global Depository Receipt (GDR), also known as international depository receipt (IDR), is a certificate issued by a depository bank, which purchases shares of foreign companies and deposits it on the account.

The SWOT analysis process involves four areas: Strengths, Weaknesses, Opportunities and Threats. Both internal and external components are considered when doing SWOT Analysis, as they both have the potential to impact the success of a project or venture.

IGST is levied on inter-state supply (i.e., supply outside the state) of goods and/or services, import of goods and/or services into India and export of goods and/or services from India

A n s w e r. Economic activities are those activities of man which are undertaken for earning money. Whereas non economic activities are those activities that are not undertaken for any monetary gain.

The three strongest trends that are shaping business;

(i) digitisation —the conversion of text, sound, images, video, and other content into a series of ones and zeroes that can be transmitted electronically,

(ii) outsourcing, and,

(iii) inter – nationalisation and globalisation. 

1. Responsibility towards shareholders:
(i) To ensure a fair and regular return on the investment of shareholders.
(ii) To ensure the safety of their investment
(iii) To strengthen financial position of the company.
(iv) To safeguard the assets of the business.
(v) To protect the interest of all types of investors in the business.

2. Responsibility Towards workers:
(i) Providing fair compensation and benefits,
(ii) Providing good and safe Working conditions,
(iii) To develop a sense of belongingness.

3. Responsibility toward consumers:
(i) To supply right quality of goods & services at reasonable prices.
(ii) To ensure regular and adequate supply of products.
(iii) To inform them about new products and new uses of existing products.
(iv) To handle the customers grievance promptly.

4. Responsibility Towards Government –
(i) To pay taxes honestly
(ii) To observe rules laid down by the government,
(iii) to avoid corrupting government employees.

5. Responsibility towards community –
(i) To make available opportunities for employment,
(ii) To avoid polluting the environment,
(iii) To up lift the weaker sections of society

1. An enterprise is the business organization that is formed by an individual and group of individuals, which brings all required resources together for the production of goods and services.
2. An entrepreneur is an innovator, generator of job and wealth, risk taker, an excellence seeker, goal oriented, appreciates quality of persistence, has creativity, sets up an organization to build something of value.

Disadvantages of WTO

• However, the WTO has often been criticised for trade rules which are still unfavourable towards developing countries. Many developed countries went through a period of tariff protection; this enabled them to protect new, emerging domestic industries. Ha Joon Chang argues WTO trade rules are like 'pulling away the ladder they used themselves to climb up' (Kicking away the ladder at Amazon)
• Free trade may prevent developing economies develop their infant industries. For example, if a developing economy was trying to diversify their economy to develop a new manufacturing industry, they may be unable to do it without some tariff protection.
• WTO is being overshadowed by new TIPP trade deals. These deals are negotiated away from WTO and focuses mainly on US and EU. It excludes China, Russia, India, Brazil and South Africa. It threatens to diminish the global importance of WTO
• Difficulty of making progress. WTO trade deals have been quite difficult to form consensus. Various rounds have taken many years to slowly progress. It results in countries seeking alternatives such as TIPP or local bilateral deals.
• WTO trade deals still encompass a lot of protectionism in areas like agriculture. Protectionist tariffs which primarily benefit richer nations, such as the EU and US.
• WTO has implemented strong defense of TRIPs ‘Trade Related Intellectual Property’ rights These allow firms to implement patents and copyrights. In areas, such as life-saving drugs, it has raised the price and made it less affordable for developing countries.

Following are the objectives of WTO
(i) To ensure reduction of tariffs and other trade harriers imposed hy different countries.
(ii) To engage in such activities which improve the standards of living, create employment, increase income and effective demand and facilitate higher production and trade.
(iii) Facilitate the optimum use of world’s resources.
(iv) Promote an integrated more viable and durable trading system.

Functions of  WTO:

Facilitate international trade

• It facilitates international trade through the removal of tariff and non-tariff barriers.
• It provides greater market access to all member countries.

Formulation of rules 

• It establishes a rule-based trading regime, in which nations cannot place arbitrary restrictions on trade.

Protecting the interest of developing countries

• It frames fair global rules, regulations.
• It safeguards and advocates the interests of the developing world.