(a) Distinguish between Commerce and Industry (b) (i) Explain three activities involved in industry (ii) Explain five activities involved in commerce

Answer Details

(a) Distinction between Commerce and Industry

Commerce is that branch of production concerned with the distribution and exchange of goods and services and all the aids that facilitate this distribution, such as trade, banking, insurance, transport, warehousing and advertising. Industry is the branch of production concerned with the actual creation or production of goods and direct services, that is, the extraction of raw materials, their processing and manufacture, and construction. In short, industry makes the goods while commerce distributes them to where they are needed.

(b)(i) Three activities involved in industry

1. Extraction: Drawing raw materials from nature, for example mining, fishing, farming and quarrying.
2. Manufacturing: Converting raw materials into semi-finished or finished goods, for example turning cotton into cloth.
3. Construction: Assembling materials to build roads, bridges, dams and houses.

(b)(ii) Five activities involved in commerce

1. Trade: The buying and selling of goods, both home trade (wholesale and retail) and foreign trade (import and export).
2. Banking: Providing finance, accepting deposits, granting loans and aiding the settlement of debts.
3. Insurance: Providing protection against various business risks and losses.
4. Transportation: Moving goods and people from one place to another, creating place utility.
5. Warehousing: Storing goods safely until they are needed, creating time utility.

(Advertising and communication are also acceptable commercial activities.)