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b. Foreign (or External) Trade
Foreign trade refers to the trade carried on between the citizens of two or more
countries of the world. It is an act of the exchange of goods and services outside the
geographical territory of a country. It involves the exchange of goods and services in
foreign currencies. It is divisible into import trade, export trade and entrepot trade.
The purchase of goods from a foreign country is known as importing and the sale of
goods to a foreign country as exporting. In entrepot trade, goods are bought from a
country in order to sell them to some other country.

Foreign trade of the world exists because certain countries are especially fit for
producing certain articles which can be produced by other countries either with great
difficulty or not at all. It has, therefore, been found advantageous that each country
should produce only those goods which it can do most cheaply and exchange her
surplus produce with the goods produced by other countries and which it requires.
It is the application of division of labour on an international scale which has given
rise to foreign trade. Foreign trade enables each country of the world to satisfy the
large number of its wants and more economically than is otherwise possible and thus
contributes to material prosperity appreciably.
2. Auxiliaries of trade

Trade is carried on with the help of certain commercial bodies, services and institutions
which are called auxiliaries of trade. These are the components which help the smooth
flow of trade. They do not involve in buying and selling of goods directly but help
in trade by providing many services. They are Transport, Banking, Communication,
Advertisement and Insurance.
Business Organization
Introduction

The term “Business Organization” is simple to understand. Human activities
undertaken for earning a profit through the production, purchase and sale of goods
constitute business. Organization is the act of bringing into effective co-operation
the available resources for achieving a definite purpose. Business Organization may,
therefore, be defined as the act of bringing into effective co-operation the available
resources for production and distribution of goods with a view to earn profit.

"Business organization is the act of bringing into effective co-operation the
available resources for production and distribution of goods with a view to
earn profit."- A.N. Agrawal

"Business organization is a concern, company or enterprise which buys and
sells, is owned by one person or group of persons and is managed under a
specific set of operating policies."- Wheeler

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