1. Discuss the inter-relationship of business, profession, and employment.


(i) Capital Investment:

In business, there is considerable capital investment-depending on the nature of business activity and scale of operations.

In a profession, there is moderate capital investment required for furniture, instruments, professional activities etc. In employment, there is no need of capital investment.

Nature of Work:

Business consists in producing/purchasing goods or providing services of a commercial nature. The nature of work comprised in a profession is rendering of services of a specialized personal nature. In employment, an employee performs duties, as per the agreement of employment.


In a business, there are no prescribed qualifications for the businessman except that he should have enterprising abilities. In a profession, there is a need to acquire minimum educational qualifications and training as prescribed by the apex body regulating the profession.

In employment, qualifications of the employee must be those which are required by the employer in the employee for the performance of duties, under the agreement of employment.


In a business, there is a considerable risk due to actions and reactions of competitors, governmental policies and behaviour of consumers in society, among many other factors. In a profession, the risk is there due to the practice by fellow practitioners.

But such risk is not much significant; as every professional commands personal popularity due to his/her expertise. In employment, there may be risk of losing job; specially when the job is temporary or the job is done for a private employer.

 Code of Conduct:

In business, there is no formal code of conduct for businessmen except that they should perform social responsibilities and must be ethical in their business behaviour. In a profession, there is a code of conduct for practitioners prescribed by the apex institution regulating the profession and issuing licences to practitioners.

Question 2.What is organic objective of business activity?

Answer: (i) Profit Earning – Every entrepreneur undertakes business activities primarily to earn profits. No business can survive for long without earning sufficient profits. A business needs profits not only for its existence but also for expansion and diversification.

Profits provide a means of livelihood for the entrepreneur and a reward for bearing the risk.

(ii) Survival – Every business aims to ensure that it continues to survive and exist in the future. Survival is possible only when organisation is able to earn enough revenue to cover its costs.

(iii) Growth – A business needs to add to its prospects in the long run. For this, the business must grow and expand to survive in the long rim.

Other Economic Objectives of Business:

(i) Creation of Customers – Creation of customers or demand is essential in order to earn profits. Customers are the focus of all business activities. A business enterprise can exist and grow only when it is able to capture a big market share, i.e. there are enough people to buy the products and services offered by an enterprise.

(ii) Innovation – Innovation refers to introduction of new ideas or new methods of production. Innovation plays a crucial role in increasing the competitive strength and improving the image of business enterprise in the mind of customers.

(iii) Optimum Utilisation of Resources – Resources available with the business are generally limited. So, every business enterprise aims to make best possible use of physical, financial and human resources. This objective can be achieved through – (a) Employing efficient and competent work force; (b) Making full use of installed machinery; (c) Minimizing wastage of materials.

Question 3 Define and explain Management ?

Answer : 

Management is the coordination and administration of tasks to achieve a goal. Such administration activities include setting the organization’s strategy and coordinating the efforts of staff to accomplish these objectives through the application of available resources. Management can also refer to the seniority structure of staff members within an organization.

1. Setting objectives

Setting and achieving objectives is the primary way a manager accomplishes and maintains success. They must also be able to convey them to their staff or employees in a compelling manner. For instance, a restaurant manager could state they want to improve service times and remind employees that faster service increases revenue and tips.

2. Organizing

Managers evaluate the type of work, divide it into achievable tasks and effectively delegate it to staff. Organization consists of a series of relationships among individual staff as well as departments or entities inside the organization. It is the manager’s responsibility to ensure that these individuals and entities work together in harmony, which includes motivating staff members and departments to stay on task. A good manager is skilled at building interpersonal relationships among their team members and can troubleshoot when members confuse their encounter challenges.

Organization also requires a manager to establish relationships of authority among their team members. Maximizing organizational arrangements can help businesses enhance the company’s efficiency in the market, reduce the costs of business and improve productivity.

3. Motivating the team

In addition to the tasks of organization and delegation, motivation includes having the skills to handle different types of personalities in a team. An effective manager must know how to form and lead successful teams and know how to galvanize team members around a cause.

4. Devising systems of measurement

Managers need to set targets or key performance indicators that the team aims for and then generate ways to measure whether their team is on track to meet those goals. Because it can be challenging to come up with measurable ways of understanding performance, managers must often be creative and thoughtful. However, like the other functions of management, measurement is critical to improving business performance.

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