Gujarat BoardEnglish MediumSTD 11 CommerceEconomicsMarket5 Marks
Question
Explain: Market and its characteristics.
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Answer
Market:
The system through which the buyers and sellers come in contact with each other directly or indirectly for the sale or purchase of goods or services is called market.
According to Professor Samuel, “Market is the functional system where the buyers and sellers contact each other to decide the price and the quantity of goods or services.”
Characteristics of a market:
$1.$ Numerous sellers and buyers:
For a market to exist, it is mandatory to have buyers and sellers of goods and services.
The exchange of goods or services done by them with a specific purpose is called the process of purchase and sale. This process allows the sellers to gain maximum profit and the buyers to gain satisfaction from the product.
$2.$ Goods and services:
It is essential that market offers goods and services to fulfill the demand and necessity of the market.
In market, the producers and sellers provide various types of products and services in order to attract the buyers towards them and maximize the profit. On the other hand, the buyers try to buy products and services that they feel are ideal for them.
$3.$ Contact:
The buyers and sellers come in contact through various means. The contact can be either direct or indirect.
In modern times the buyers and sellers come in contact through the following ways:
$(a)$ Tele-shopping:
In Tele-shopping, the buyers themselves order the services or products through a telephone. This means indirect contact takes place via. telephone.
$(b)$ Online shopping:
In online shopping the buyers order the services or products which they select on websites via. internet. This means indirect contact takes place via. online shopping.
$4.$ Price:
The price of the product or service must be decided in the market at a given time. The price is decided according to the demand and the factors related to its supply.
The price of products and services depends on the demand made by the buyers and the ability of the producers and sellers to supply them.
$5.$ Information about the market situation:
It is important that the buyers and sellers are well-informed about the current market situation.
This helps to take proper decisions related to production, distribution and purchase during the times of recession, inflation, natural and man-made calamities.
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