Laxmi

Tamilnadu Samacheer Kalvi 11th Commerce Notes Chapter 23 Channels of Distribution Notes

→ A channel is the route through which the goods are passed on to the ultimate consumer.

→ According to Cundiff E.W. and Still, a channel of distribution may be defined as “a path traced in the direct or indirect transfer of title to a product as it moves from the producer to ultimate consumers”.

→ According to American Marketing Association, “A channel of distribution is the structure of intra company organization units and extra company agents and deals wholesale and retail through which a commodity or product or service is marketed”.

→ The VARs receive the products from the manufacturers, incorporate them as if their own products by adding value enhanced service and sell them to customers.

→ Producers adopt this channel to distribute goods or services in the home country and foreign countries.

→ Seasonal products are distributed through less layer of middlemen.

→ The term ‘Middlemen’ refers to all those who are in the link between the primary producer and the ultimate consumer in the exchange of goods or service.

→ A Broker is one who bargains for another and receives commission for his service.

→ A factor is a mercantile agent to whom goods are entrusted for sale by a principal.

→ A commission agent buys and sells goods on behalf of the principal for a fixed rate of commission for all his transactions.

→ Auctioneers are agents who sell goods by auction on behalf of their principals.

→ A Warehouse keeper accepts goods for the purpose of storage in his warehouse.

→ Drop Shippers are another type of limited-service wholesaler.

→ Truck jobbers (or truck wholesalers) actually store products, which are often highly perishable (e.g., fresh fish), on their trucks.

→ Rack Jobbers sell specialty products, such as books, hosiery, and magazines that they display on their own racks in stores.

→ Wholesale trade means buying and selling goods in relatively large quantities or in bulk.

→ According to Cundiff and Still “wholesaler buys from the producer and sell merchandise to the retailers and other merchants and not to the consumers”.

→ According to Evelyn Thomas “a true wholesaler is himself neither a manufacturer nor a retailer but act as a link between the two”.

→ A wholesaler arranges for the transport of goods from producers to his warehouse and from the warehouse to retailer.

→ Retail trade is a trade that deals with the distribution of goods in small quantities to the end consumers.

→ According to S. Evelyn Thomas “the retailer is the last of the many links in the economic chain whereby the consumer’s wants are satisfied smoothly and efficiently by retailers”.

→ According to Cundiff and Still “a retailer is a merchant or occasionally an agent whose main business is selling directly to the. ultimate consumers”.

→ A retailer has been defined as “a trading intermediary engaged in the distribution of goods to the ultimate consumer”.

→ A wholesaler serves as a link between producers and retailers.

Samacheer Kalvi 11th Commerce Notes

Tamilnadu Samacheer Kalvi 11th Commerce Notes Chapter 24 Retailing Notes

→ Retailing is the process of selling the goods and services directly to the ultimate consumers in small quantities.

→ The traders who have no fixed place of sale are called Itinerants.

→ Mobile traders deal in low price, daily usable items such as fruits, vegetables, fish, clothing, books, etc.

→ Peddlers are individuals who sell their goods by carrying on their head or shoulders moving from place to place on foot.

→ Hawkers are petty retailers who sell their goods at various places such as bus stop, railway station, Public Park and gardens, residential areas and other public places using a convenient vehicle to carry goods from place to place.

→ The traders sit on the footpath of the road or at the end of the road (pavement) and sell their goods such as fruits, vegetables, books, etc., are called Street vendors.

→ The retailers who maintain permanent establishment to sell their goods are called Fixed Shop Retailers.

→ General Stores sell a wide variety of products under one roof, most commonly found in a local market and residential areas to satisfy the day-to-day needs of the customers residing in nearby localities

→ Single-line Stores are small shops which deal in a particular line of products such as garments, stationery, textiles, medicines, shoes, etc.

→ Speciality Stores deal in a particular type of product under one product line only.

→ The retailers having permanent establishment and dealing in. large scale are called Fixed shop large scale retailers.

→ A Departmental Store is a large retail establishment offering a wide variety of products, classified into well defined departments.

→ A department is a large scale retail showroom requiring a large capital investment by forming a joint stock company managed by a board of directors.

→ A departmental store combines both the functions of retailing as well as warehousing.

→ A departmental store requires a large building with ample parking at a central place.

→ A number of identical retail shops with similar appearance normally deal in standardised and branded consumer products established in different localities owned and operated by manufacturers or intermediaries are called as Chain stores or Multiple shops.

→ Multiple shops enjoy public confidence due to fixed prices, standard quality, uniform appearance, and selection of goods with the help of salesmen.

→ A Super market is a large retail store selling a wide variety of consumer goods on the basis of low price appeal, wide variety and assortment, self-service and heavy emphasis on merchandising appeal.

→ A consumers’ cooperative store is a retail organisation owned, managed and controlled by the consumers themselves to obtain products of daily use at reasonable low prices.

→ Hire purchase trading is a system by which the seller agrees to sell the articles to the buyer on condition that the payment of the article will be made in a fixed number of installments till the sale price is paid.

→ Installment system is a type of purchase in which the price amount of the product is not paid initially but in installments. It is also called as deferred payment system

→ Automatic vending machine is a new form of direct selling.

→ Shopping malls are developed due to change in departmental stores in modem time.

→ The manufacturers or the intermediaries place the advertisement of their products on different media of internet like e-mail, portal and browser.

→ The associations of agriculturists and other federations interact with farming cooperatives to streamline local subsidies and formulate marketing policies for selling agro products.

Samacheer Kalvi 11th Commerce Notes

Tamilnadu Samacheer Kalvi 12th Economics Notes Chapter 4 Consumption and Investment Functions Notes

→ The chapter consumption function and investment function can be summarised under three heads.

→ The consumption function deals with relationship between national income and consumption expenditure Viz APC, MPC and APS, MPS.

→ The subjective and objective factors determine consumption function.

→ The investment function includes autonomous investment and the induced investment, the functional relationship between interest rate and the investment, the role of MEC and rate of interest in determining the investment.

→ The multiplier is directly related to MPC and inversely related to MPS.

→ The accelerator principle explains the effect of changing consumption expenditure upon volume of investment.

→ The interaction of multiplier and accelerator is called super multiplier.

→ Accelerator: ratio of change in induced investment to change in consumption, (or) Technical relationship between change in capital stock and change in level of output.

→ Autonomous Consumption: Autonomous consumption is the minimum level of consumption or spending that must take place even if a consumer has no disposable income, such as spending for basic necessities.

→ Autonomous Investment: Additional investment that is independent of income.

→ Average Propensity to Consume (APC): Ratio of the consumption expenditure to income. C/Y

→ Average Propensity to Save (APS): Ratio of the saving to income. S/Y

→ Consumption function: The relationship between consumption and income, the tendency to imitate superior consumption pattern. Additional investment demand that results from an increase in domestic product (GDP).

→ Demonstration effect: Ratio of change in consumption to change in income. ΔC/ΔY

→ Induced investment: Ratio of change in saving to change in income. ΔS/ΔY

→ Marginal Propensity to Consume (MPC): Marginal Propensity to Save (MPS): ratio of change in income to change in investment. ΔY/ ΔI

→ Multiplier: External factors which are real and measurable.

→ Objective Factors Subjective Factors: Internal factors related to Psychological feeling.

→ Super Multiplier: The combined effect of interaction of multiplier and accelerator.

Samacheer Kalvi 12th Economics Notes

Tamilnadu Samacheer Kalvi 11th Commerce Notes Chapter 25 International Business Notes

→ International trade has become inevitable after the second world war since no country remains self sufficient in terms of all natural resources available therein.

→ Countries across the world are endowed with natural resources of various kinds.

→ Today we live in a world where the obstacles to exchange of the goods and technology have been substantially reduced.

→ The contemporary world is called as‘global village’.

→ Today business is growing globally and the need for profit is pushing a large number of business firms into world markets beyond their historical and traditional boundaries.

→ ‘International business denotes all those business activities which take place beyond the geographical limits of the country.

→ Roger-Bennet defines, International business involves commercial activities that cross national frontiers.

→ According to John D. Daniels and Lee H. Radebaugh, International business is all business transactions -private and governmental- that involve two or more countries.

→ A Joint venture is a business agreement wherein parties agree to develop a new entity and assets subscribing to equity shares and thereby exercising control over enterprise and consequently sharing revenues, expenses and the assets.

→ FDI means investment made by a company or individual in one country in the business , interest in another country in the form of either establishing new business operations or acquiring business assets in the other country.

→ Production cost varies significantly among the countries due to difference in socio-economic, geographical, demographical, technical and political environments prevailing therein.

→ Consumers are relatively heterogeneous in nature in terms of culture, behavior, taste, preferences, legal system, customs and practices, etc. prevailing across the countries.

→ The risks involved in international business are more due to distance, difference in socio-economic and political conditions, change in foreign exchanges value, etc

→ On the basis of sale and purchase of goods and services, international trade can be divided into three kinds. They are export trade, import trade and entrepot trade.

→ When the firm of country sells goods and services to a firm of another country it is called export trade.

→ When the business firm of a country purchases of goods from the firm of another country it is called import trade.

→ When the firm of country imports goods for the purpose of exporting the same goods to the firms of some other country with or without making any change in the goods meant for export it is known as entrepot trade.

→ Countries across the world differ significantly in terms of natural resources, capital equipment, manpower, technology and land and so on.

→- International business operates on a simple principle what your country can produce more efficiently and trade the surplus production with other countries, to procure what they can produce more efficiently.

→ On account of international business , the citizens of the country can buy more varieties of goods and services which cannot be produced cost effectively within the home country.

→ International business helps to stabilize the prices of various commodities which are fluctuating on a daily basis in the world market.

→ International business enables the firms across the country to sell their goods and services on a large scale in the international market.

→ International business makes countries across the world become inter-dependent while they ‘ are independent in their functioning.

→ International trade is more likely to make the country too much dependent on imports from foreign countries.

→ International business may create economic dependence among the countries which may threaten their political independence.

→ Acute competition for exports may lead to rivalry among the nations.

→ International business may result in invasion of country’s culture.

Samacheer Kalvi 11th Commerce Notes

Tamilnadu Samacheer Kalvi 12th Economics Notes Chapter 3 Theories of Employment and Income Notes

→ Keynes challenged the classical economic theory regarding the merits of state intervention in markets and led to widespread shift in both economic theory and government policies worldwide in the post World War II period.

→ Full employment refers to a situation in which every able bodied person who is willing to work at the prevailing wage rate, is employed.

→ Every economy in the world aims at attaining the level of full employment equilibrium where all its available resources are fully and efficiently employed to achieve maximum level of output.

→ Unemployment is problem faced when there are people, who are willing to work and able to work but cannot find suitable jobs.

→ In developing countries like India, the nature of unemployment is different from that of developed countries.

→ Full employment: Persons who are willing to work and able to work must have employment or a job.

→ Unemployment: when there are people, who are willing to work and able to work but cannot find suitable jobs.

→ Disguised unemployment: It is found in which when more people are doing work than actually required.

→ Under employment: Resources (e.g. Labour) are not fully utilized in production.

→ Effective demand: The amount of money which entrepreneurs expect to get by the output product.

→ Aggregate demand: The amount that households, firms, the governments and the foreign purchasers would like to spend on domestic output.

→ Aggregate supply: The value of total output of goods and services produced in an economy in a year.

→ Marginal Propensity to Consume: The additional consumption due to an additional unit of income.

→ Marginal Efficiency of Capital: The expected rate of return over costs of a new capital good.

→ Money supply: The total stock of money circulating in an economy.

Samacheer Kalvi 12th Economics Notes

Tamilnadu Samacheer Kalvi 11th Commerce Notes Chapter 26 Export and Import Procedures Notes

→ Exports have attained greater importance in the contemporary world.

→ Developing countries like India, Bangladesh, South Korea and so on require substantial amount of foreign exchange in order to acquire machineries, equipment, raw materials, petroleum products, mineral resources, technical know-how, managerial talents and so on for their faster economic development.

→ Export and Import Bank which is one of the specialized financial institutions wholly owned by Government of India was set up in the year 1982 for financing, facilitating and promoting foreign trade of India.

→ Commercial banks provide financial assistance in two ways, namely, pre-shipment financial #assistance and post-shipment financial assistance.

→ Pre-Shipment Financial Assistance is the type of assistance given to enable exporters to purchase raw materials process them and create finished goods for the purpose of export.

→ Post-shipment financial assistance is an assistance granted in the form of advances on the basis of bills of exchange and shipping documents drawn under letters of credit.

→ An exporter has to fulfill the formalities given below to export the goods out of the country.

→ Exporter has to apply in Ayaat Niryatt Form 2A (ANF2A) to the Regional Authority of the Director General of Foreign Trade (DGFT) in the region where the registered office of the company is located.

→ An Exporter is required to obtain RCMC from Export Promotion Councils/Commodity Board/Development Authority in order to avail himself/herself of export incentives, concessions, and other facilities offered by Government.

→ Exporters steps into manufacturing and procuring of goods required by the importer.

→ Import regulation of foreign countries may require that all this import consignments must accompany a certificate of origin.

→ The exporter will send the goods over to port town by rail or by truck and endorse the Railway Receipt (R/R) or Lorry Receipt(L/R) to forwarding agent’s favour with necessary instructions.

→ A charter party is a formal agreement between ship owner and the exporter under which exporter hires an entire ship or a major part of ship either for a particular voyage or for a specific time period when the shipping is heavy.

→ There are three types of shipping bills for three different categories of goods namely, dutiable goods, duty-free goods and duty draw-back goods.

→ Mate’s Receipt is the document issued by the captain of the ship acknowledging the receipt of goods on board by him to the port of specified destination.

→ Bill of Lading, refers to a document signed by ship owner or to his agent mentioning that goods specified have been received and it would be delivered to the importer or his agent at the port of destination if good condition subject to terms and conditions mentioned therein.

→ The exporter prepares a commercial invoice in respect of the goods shipped in triplicate according to the terms and conditions agreed between the exporter and the importer.

→ Commission Agent is an international agent who is paid a certain percentage of commission for the order booked by him abroad.

→ Export Trading House has been established to increase the export, strengthen the global market, capacity and get necessary facilities for increasing export performance of our country.

→ Import trade refers to purchasing goods and service from a foreign country.

→ Consumers are able to use a wide variety of goods like cell phone, car, laptop, television, audio system, washing machine, perfume, soaps, etc., manufactured in foreign countries and enhance their standard of living through import trade.

→ During famine, earthquake, flood draught, tsunami, abnormal price-increase situations and so on food grains, vegetables and other essential commodities are imported from foreign countries and bad situation arising from the above situations are thus overcome.

→ Importer has to secure Import and Export Code (IEC) from the Director General of Foreign Trade or its Regional Authority.

→ Bill of Entry is prepared in triplicate in order to pay custom duty.

→ Clearing Agent is specialised in clearing the goods from the port of discharge destination , and transport it over to the importer.

Samacheer Kalvi 11th Commerce Notes

Tamilnadu Samacheer Kalvi 12th Economics Notes Chapter 2 National Income Notes

→ The national income of a country describes the economic performance or production performance of a country.

→ Economists, planners, government, businessmen and international agencies (IMF, World Bank,, etc.,) use national income data and analyses them for various purposes.

→ National income data help in measuring changes in the standard of living over time and also enable us to compare standard of living of different countries.

→ Level of development of a country is also measured by using national income figures.

→ Capital sector: It includes saving and investment activities.

→ Disposable income: It is the sum of the consumption and saving of individuals after the payment of income tax.

→ GNP: Total money value of final goods and services produced in a country during a particular year (one year) including depreciation and net exports.

→ NNP at Factor cost:The total of income payment made to factors of production.

→ NNP: Total money value of final goods and services produced in a country during a particular year (one year) excluding depreciation including net exports.

→ Per capita income: Annual average income of a person.

→ Personal Income: Total income received by the individuals of a country before payment of direct taxes.

→ Social Accounts: The accounts of national income considering the social cost generated by economic activities.

→ Transfer payments: Government makes payments in the form of pensions unemployment allowance, subsides, etc.

→ Unpaid services: Rendering useful services like preparation of meals, washing, cleaning, bringing up children, services to their friends and relatives without payment.

Samacheer Kalvi 12th Economics Notes

Tamilnadu Samacheer Kalvi 12th Economics Notes Chapter 1 Introduction to Macro Economics Notes

→ Macroeconomics studies the behavior and performance of an economy as a whole.

→ It covers the functioning, performance and growth of an economy.

→ It examines the macro aspects such as employment, national income, inflation, business cycle, poverty, inequality, disparity, investment and saving, capital formation, infrastructure development, banking, public finance, international trade, balance of trade and balance of payments, exchange rate and economic growth.

→ Economic models based on economic variables are useful in understanding an economy.

→ Circular Flow Models provide a base to understand the functioning of a macro economy.

→ An economy could be classified on the basis of economic systems such as capitalistic economy, socialistic economy and mixed economy.

→ However, nowadays it is difficult to find 100 percent capitalist system, socialistic system or perfectly mixed economy.

→ Capitalism: The system where the means of production are privately owned and market determines the economic activities.

→ Circular Flow: It shows flows of income, goods and services and factors of production between economic agents such as firms, households, government and nations.

→ Economic Model: It is an explanation of how the economy, or part of the economy, works.

→ Economic System: The manner in which individuals and institutions are connected together to carry out economic activities in a particular area.

→ Flow: Variables measured over a period of time (Dynamic).

→ Globalism: An economic system where the economic activities of a nation are inter connected and inter dependent on each other nation.

→ Macroeconomics: The branch of economics that studies the behavior and performance of an economy as a whole.

→ Mixedism: An ideology that mixes or combines the principles of Capitalism (Private Role) and Socialism (Nation Role) in an economy.

→ Socialism: A way of organizing a society in which major economic activities are owned and controlled by the government rather than by individual people and companies.

→ Stock: A quantity of a commodity that is constant at a point of time (Static).

Samacheer Kalvi 12th Economics Notes

Tamilnadu Samacheer Kalvi 11th Commerce Notes Chapter 27 Facilitators of International Business Notes

→ International business involved complex issues among various countries way back in 1950’s.

→ The World Trade Organisation (WTO) was established on 1st January 1995.

→ WTO has 164 member countries as on 29th July 2016.

→ WTO is a forum for negotiation and formalization of trade agreement among the member countries.

→ WTO supervises the operation of agreement relating to General Agreement on Tariffs and Trade(GATT) and Trade-Related Intellectual Properties Rights (TRIPS).

→ WTO is promoting international peace and creating a conducive environment for conducting international trade.

→ WTO provides a platform for member countries to establish trade links with one another.

→ WTO is committed to protecting free trade. It has framed rules on subsidies and dumping.

→ WTO encourages import from certain countries which produce the product on a larger scale at the cost of environment.

→ WTO is criticized for promoting the domination of multinational companies which are feared to eliminate local enterprises from business world altogether.

→ WTO defends trade related intellectual property rights which allow the firm to protect the patent and copy right.

→ International Bank for Reconstruction and Development is commonly known as World Bank.

→ International Monetary fund (IMF) is an international organization headquartered in Washington DC.

→ IMF was established in 27th December 1945 on the recommendation of the Bretton Wood Conference.

→ IMF promotes economic stability and global growth by encouraging countries adopt sound economic and financial policies.

→ International Financial Corporation (IFC) is an international financial institution that offers advisory services to build up private sector in developing countries.

→ ICSID is an autonomous institution setup in order to provide a forum for conciliation and arbitration of international dispute, It was setup in 1966.

→. India has got a lot of financial assistance from IMF to solve the economic crisis arising from natural calamities like, floods, famine, earthquake, aggressions of Chinese and Pakistan etc.

→ South Asian Association for Regional Co-operation is the regional inter governmental organization and geo-political union of nations in South Asia.

→ At the top SAARC is represented by the heads of member nations. ‘

Samacheer Kalvi 11th Commerce Notes

Tamilnadu Samacheer Kalvi 11th Commerce Notes Chapter 28 Balance of Trade and Balance of Payments Notes

→ Balance of trade and balance of payment are important aspects in international trade.

→ Balance of payment refers to a systematic record of all economic transactions between the residents of one country and the residents of foreign countries during a particular period of time.

→ Balance of payment is the principal tool for the analyzing the monetary position of international trade of a country just like Receipt and Payment account of enterprise revealing the net effect of cash movements during in an enterprise to a particular period.

→ A Balance of Payment surplus indicates that country^ exports are more than its imports and its government and residents are savers.

→ According to International Monetary Fund, “ The balance of payments for given period is a’systematic records of all economic transactions taken place during the period between residents of the reporting countries.” .

→ In the words of Domini Salvatore “The Balance of payment is a summary statement in which principle all the records of the resident of a nation with the resident of all other nations are recorded during a particular period of time, usually a calendar year.”

. → BOP shows a favourable or surplus position when the total receipt’s from foreign countries exceed the total payment to foreign countries.

→ Balance of trade denotes the difference between the value of import and the value of export during a year.

→ Private capital consists of foreign investments, long term loan and foreign currency deposits.

→ Banking capital includes movement into external financial asset and liabilities commercial and co-operative banks authorized to dealing in foreign exchange.

Samacheer Kalvi 11th Commerce Notes