NCERT Solutions for Class 11 Business Chapter 10 - Internal Trade

Short Answer Questions

1. What is meant by internal trade?

Ans: Buying and selling goods and services internally national borders are called internal trade. Shopping at a local store, supermarket or in the exhibition is an example of internal trade. There is no tradition Import duties are levied on these goods and services. We can divide these into two major categories:

(1) trading in a wholesale store

(2) re-trade.

2. Specify the characteristics of fixed shop retailers.

Ans: Retailers who have a fixed location to offer their goods are known as fixed shop retailers. As a result, they do not relocate from one location to another to service their consumers.

Fixed Shop Retailers' Characteristics:

(i) In comparison to itinerant dealers, they have more resources and operate on a larger scale.

(ii) These stores sell a variety of products, including both consumer durables and non-durables.

(iii) They have a higher level of trustworthiness among customers.

(iv) They are able to give more services to clients, such as home delivery, maintenance, and credit facilities, among other things.

3. What purpose is served by wholesalers providing warehousing facilities?

Ans: Two goals are made by wholesalers to provide warehousing facilities in the following ways:

(1) Wholesalers reduce the burden on manufacturers to provide for warehousing of finished products.

(2) The maintenance of houses by shopkeepers also eases shops of collection work from several manufacturers and maintaining the same large storage collection adequate stock of various customer goods.

4. How does market information provided by the wholesalers benefit the manufacturers?

Ans: As retailers communicate directly with vendors, provide details and advice to the manufacturers with a variety of features including customer service taste and popularity, market conditions, competition functions and features of consumer preferences. This information helps producers address changing consumer needs.

5. How does the wholesaler help the manufacturer in availing the economies of scale?

Ans: Wholesalers used to act as a link between the manufacturers as well as vendors as well as retailers. They collect small orders from a number of vendors and transfer to the pool of such orders in manufacturers and buy in bulk. This enables producers to make a product to a large extent and take advantage of economic opportunities in estimates. They also help the manufacturers by providing the market conditions and preferences. 

6. Distinguish between single line stores and speciality stores. Can you identify such stores in your locality?

Ans: The difference between the single-line stores once specialty stores is given below:

Based on these features, we can identify the file for different types of shops in the area even if they exist one-line shops or specialty stores.

7. How would you differentiate between street traders and street shops?

Ans: We can differentiate between the street vendors and street shops as follows:

8. Explain the services offered by wholesalers to manufacturers.

Ans: The most important services provided by wholesalers to producers of goods and services are listed below.

(i) Making Large-Scale Production Easier: Small orders from a variety of merchants are collected by wholesalers, who then transmit the pool of orders on to manufacturers, who make bulk purchases.

(ii) Taking Chances: Wholesalers trade in commodities in their own name, take receipt of the items, and store them in their warehouses, risking price drops, theft, spoilage, and fire, among other things.

(iii) Financial Support: The wholesalers aid the producers financially by making cash payments for the commodities they acquire.

(iv) Professional Advice:  As they interact with retailers, wholesalers can provide advice to manufacturers on a variety of topics, including customer tastes and preferences, market conditions, competitive activity, and the qualities that customers like.

(v) Assist in the Marketing Department:  Wholesalers are in charge of distributing items to a variety of retailers, who then sell to a huge number of clients dispersed throughout a big geographic area.

(vi) Assist with Continuity: Wholesalers help to ensure that production activity continues throughout the year by acquiring goods as they are created.

9. What are the services offered by retailers to wholesalers and consumers?

Ans: Wholesalers and customers can take advantage of a variety of services provided by retailers. The following is a list of some of these services.

(a) They supply information to clients: Retailers notify customers about new products on the market, their features, and prices, among other things. Customers can use this information to assist them determine which product to purchase.

(b) They supply information to wholesalers: Retailers provide wholesalers with information such as client tastes and preferences, current market conditions, and market competitiveness levels. Manufacturers receive this information from wholesalers.

(c) They stock a diverse range of items: Retailers often stock a diverse selection of goods depending on consumer likes and preferences, allowing customers to select from a wide range of options.

(d) They make it easier to get things to customers: Retailers make it easier to get items to customers for final consumption.

(e) They aid in the promotion of goods: Because merchants have direct contact with customers, they can use human interaction to promote the sale of goods. As a result, retailers assist wholesalers and manufacturers in marketing product sales.

Long Answer Questions

1. Itinerant traders have been an integral part of internal trade in India. Analyse the reasons for their survival in spite of competition from large scale retailers.

Ans: Itinerant traders are merchants who do not have a set location where they operate. That is to say, they do not have a storefront from which to offer their wares. They are also known as mobile traders since they move from one location to another to sell their wares. They are usually located by the sides of the road, and they move around in quest of more consumers. They typically sell low-cost, non-standard items.

The following elements are responsible for itinerant vendors' survival in the face of fierce competition from large-scale retailers:

(1) They usually work on consumer goods at a lower price of daily use such as private products, fruits and vegetables, and so on.

(2) They interact directly with consumers and therefore, able to pay more attention to them and give more customer care services by getting the right response as well transferring information to manufacturers.

(3) They travel from place to place and deliver goods to customer service department that facilitates easy access of required products.

(4) Traveling merchants to such places difficult to store due to poor quality of search. They offer their services even remotely places.

2. Discuss the features of a departmental store. How are they different from multiple shops or chain stores.

Ans: The department store is a large building offer a variety of products, well classified - Designed departments, which aim to satisfy almost all customer needs under one roof. Some important ones

The following are some of the characteristics of a department store:

(1) A modern department store may offer all of the services of a restaurant, one-way travel information centre, telephone booth, living rooms, and so on.

(2) Departmental stores are usually located in the center places to attract a large number of customers.

(3) Since the size of these stores is very large, it is largely formed as a joint stock company owned by the Board of Directors. There is an assistant manager in charge of the general manager.

 (4) They have moderate purchasing arrangements. Everything purchased at the department store is made in the center by the store’s purchasing department, and sales are reduced to various departments. 

The difference between a department store and more stores:

3. Why are consumer cooperative stores considered to be less expensive? What are its relative advantages over other large scale retailers?

Ans: A consumer cooperative store usually buys In bulk, directly from major manufacturers or retailers then sell it to consumers at a lower price. Since the middle man is eliminated or reduced, members find good quality products at affordable prices. Therefore, these stores are considered small it’s expensive. Its profits rather than large-scale retailers are:

1. Design: Easy to build customer Co-operative society. Any ten people can get together they formed a voluntary organization and acquired it registered with the Registrar of Cooperatives to eliminate certain goals.

2. Credit: Members’ debt to Co-operative store is limited to the size of the capital provided by them.

3. Cooperative societies are governed democratically by administrative committees preferred by members.

4. Prices: A cooperative store buys goods directly to major manufacturers or retailers, the role of intermediates are removed resulting in lower values ​​of consumer goods to members.

5. Sales: Consumer cooperative stores usually sold goods for cash. As a result, the financial performance requirement has been reduced.

6. Location: Consumer cooperation shops are usually opened in convenient public places where members and others can easily buy products according to their needs.

4. Imagine life without your local market. What difficulties would a consumer face if there is no retail shop?

Ans: There are many difficulties that people can face if there is no retail store as these serve as a link between manufacturers / retailers and consumers as they buy goods from supermarkets / retailers and sell them directly to consumers. If there are no retail stores available neighbours at that time life will be difficult. By buying a simple product or for everyday use we will have to go a long way. We can buy certain things as and when required if other retail stores are within transit not far from our house. In an emergency, we can easily find medicine and other necessary items if any shops are nearby. Otherwise, life can be very difficult.

They play an important role in following things:

1. Product availability: Keeping the general availability of various products produced by various manufacturers is a very significant seller's service to consumers. This allows customers to shop for things when and when they need them.

2. Product details: Stores offer customer information about new products, their features, prices, etc. This information helps customers to decide which product to buy, thereby making them easier product options.

3. Convenience in purchase: Customers can purchase tailored to their needs. Furthermore, they are common. It is very close to residential areas and is open. It offers great flexibility for a long time consumers are buying products to suit their needs.

4. Wide choice: Retailers generally offer customers a variety of goods such as stationery, dairy products and foods.

5. After-sales services: Retailers provide important ones in the form of home delivery, after-sales service delivery of spare parts and attending customers ‌.

6. Provide credit facilities: sometimes customers‌ provide credit facilities to regular buyers allowing customers to increase their level of consumption and, therefore, their standard of living.

5. Explain the usefulness of mail orders houses. What type of products are generally handled by them? Specify.

Ans: Retail outlets selling mail order houses their goods by mail. Not usually direct personal contact between buyers and sellers in this kind of business.

Advantages of Mail Order House:

(1) Requires limited capital: Mail order business nohuge expense is required on the building and other things infrastructure. Therefore, it can be started from relatively small capital.

(2) Removal of intermediaries: Mail-order houses eliminate their role in the behaviour of intermediaries directly to customers. This leads to a significant customer at the expense of customers.

(3) Absence of bad debts: From postal order houses do not give credit facilities to customers, nor the possibility of any bad debt due to non-payment cash by customers.

(4) Broad Reach: As soon as the products are mailed, the seller will be able to provide information about their belongings to clients all across the country.

(5) Convenience: Goods are delivered to the customer's home under this system. The end result is fantastic, and buyers will find it easy to purchase these items.

Types of products that are usually handled by mail Order houses are as follows: 

• Graded and standard items.

• Items that can be easily carried at low cost.

• Goods ready in demand in the market.

• Items that can be easily explained through pictures.

NCERT Solutions for Class 11 Business Studies Chapter 10 Internal Trade

Internal Trade and Its Types

Internal trade is when the buying and selling of products and services take place within the geographic limits of a nation.

The main characteristics of Internal Trade are:

(i) The purchasing and selling of assets and services take place within a country.

(ii) The payments are given and received in the home country.

(iii) There are no or significantly fewer formalities to be performed by the traders.

Internal Trade Can Be Classified Into Two Divisions.

(i) Wholesale Trade refers to the trade in which goods are traded in large amounts. The one who carries on wholesale trade is called the wholesaler.

A wholesaler gives many valuable benefits to the manufacturer as well as the retailer.

(a) Services to Manufacturer

• Facilitating large scale production

• Bearing risk

• Financial assistance

• Expert advice

• Help in the marketing function

• Facilitate production continuity

• Storage

(b) Services to Retailer

• Availability of goods

• Marketing support

• Grant of credit

• Specialized knowledge

• Risk sharing

(ii) Retail Trade relates to the sale of products in small lots to the final customers. A retailer buys products from a wholesaler and trades them to the final buyer.

Functions of Chambers of Commerce and Industry in Development of Internal Trade

The chamber of commerce is an organization of business holders, about various traders and industries. Its main objective is to promote the overall business interests of all the members and to faster the expansion of commerce and industry in a particular locality, religion or country. Following are the significant functions of the chamber of commerce and industry.

(1) Conducting study and collecting statistics and additional information about business and the economy.

(2) Providing technical, legal, and different useful information and guidance to its members.

(4) Arranging the education and training of members. Some chambers even administer commercial examinations and award diplomas.

(5) Arranging industrial exhibits, trade fairs etc. to promote trade.

(6) Advising the government in matters concerning the industrial and economic advancement of the region.

(7) Providing certificate of origin to exporters.

(9) Providing a forum for discussing the everyday problems of business people.

(10) Acting as arbitrators for solving difficulties and disputes between the members.

Why should One Choose Vedantu NCERT Solutions?

NCERT Solutions for Class 11 Business Studies Chapter 10 provided by Vedantu are in pdf format, and the answers are entirely accurate. Business Studies Class 11 Chapter 10 Internal Trade solutions include the answer to all the questions in the textbook. They would help the students get a good grip on the knowledge of the chapter which is essential to get good marks in the exams. Business Studies Class 11 Chapter 10 would help the students gain a great understanding of the chapter and help them in knowing the question pattern, marks weightage and the critical keywords in the book.

These solutions are compiled by expert teachers with years of experience and strictly adhere to the CBSE and NCERT guidelines. The solutions are crafted to help the students in improving their knowledge and understanding different topics. You can even get experienced learning with the help of the chapter-wise study material. It is very much beneficial for the students to understand how to answer the questions related to this chapter. The students highly require the ch 10 BST Class 11, as it is very much useful for them in the exam preparation.

Solved Examples

1. Buying Goods from a Foreign Nation is Called

1. Import

2. Entrepot

3. Export

4. Re-Export

Answer: A 

2. Goods Imported for Export is Known as

1. Home trade

2. Foreign trade

3. Entrepot

4. Trade

Answer: C

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