What is business ? Definition of Business Business means all economic activities which is done for the motive of earning.

In these activities, we can include production, manufacturing, purchasing and selling and other market promotion activities. Commerce, trade and aids to trades and enterprise are also included in business. 2 truthful facts about business:1. Richest person of the world = Bill Gates Net worth in USD = $ 40.0 billion Business = Microsoft 2. Oldest company is Kong Gumi of Japan in the world and its business is construction . This company started his business in 578 in company form. Main Concept and Objective of Business There two concept of business:1st Economic concept of business This is oldest concept of business and according to this concept; main aim of business is to earn profit and never to do any other work. Under this concept, every legal and illegal and scams and fraud are the necessary for doing highest profit from business. Because in old time, there is no competition and trend to earn money is by any way. But now this concept is totally failed and bear a new concept which is successful in world business market. 2nd Social concept of business:According to this concept, businesss all activities are done for making stable customers and make them satisfied. Now, all business organization is understood this point and making social networking for promoting business. Even all big business organization is communicating with general public by the way of twitter and face book and linkedin (35 million registered business profiles).

Objective of business There are also two main objectives 1st objective i) to earn profit ii) to growth iii) to innovation 2nd objective of business i) to satisfaction of employees Employees are main asset of business and it is the main object of business to satisfy its employee by providing them fair salary and other incentives because , without this business can not operate well and from time to time development of employee of business is the main need of business . ii) to satisfaction of customers It is also aim or objective of business to satisfy its customers and it should do the work for their welfare. This welfare may by possible by providing product at low cost and high quality. A stable customer can provide stable amount of sale and contribute in the stable growth rate of business. iii) to satisfaction of investors :Investors are those persons who invest their money in business and it is the main aim of business to provide them high rate of return and make them satisfied because, if there are satisfied, they will not sell companys share at low price and financial crisis will not be faced by businessman. iv) other social responsibility :To obey all other responsibility of society is also main objective of business and in this responsibility we can include protection of environment. We are seeing that business are becoming restriction in the way of environment protection but , because of business also dependent on environment and all raw material comes from environment , then it is the duty of businessman to protect environment by growing plantation in their business plants and also starting new programme for protection of environment .

What is business environment? Definition of Business Environment Business Environment may be define as all external and internal factors which affects the activities of business. In these factors we can include customers, suppliers, and employees, Govt., Economy and Competitors. Explanation of Business Environment We can explain business environment with physical environment of nature . When we see nature , we find many things air , water , sun , moon and so many other things . They create environment . Nature is effected from these factors from time to time and shows his presentation in the form of raining , season and other variations . Same thing happens in business . Business is also affected from its environment . Suppose , If Govt. increases service tax rate or VAT rate . At this time , business has also to increase the price of his products . There is not just a single factor are affecting business but large number of factors affect business . So , see the behaviour of different factors is necessity of time for operating business smooth in this environment . Elements of business environment and its explanation by presentation

This question for UGC NET Commerce is most important because , first it covers total them of business environment book at post graduate level and second , if you search it on google , you will got 1610000 results on google . Because approximate every finance publisher has written this concept in their site and blog and also this matter is discuss in every net forum . So , please understand these element clearly and I have also upload one docs presentation of element of business environment . So , also watch and understand it .

Main Elements or factors of Business Environment

A Micro business Environment: This is also known as internal business environment because business has power to control them. In this environment, factors can be divided with following way. 1st Supplier A supplier provides raw material to business. This is also main factor of business environment because, it affects business very closely. If supplier delay to supply raw material or stop to supply. At this time production of business can be stopped due to not getting raw material. So, for controlling this factor, it is the duty of businessman to make good relation with more than one supplier so that, if one stop or delay at this time, goods can be purchased from other supplier. 2nd Customers Customers are those people or companies which buy goods from our business. Business sells them his finished product. But time to time tastes of customers also change. So, according to the taste of business customers, new products must be supplied by business. That is the formula for living long life of business. 3rd Market Intermediaries For promoting sale, it is required to ads by different way, so market intermediaries include sales man and middle man. This environment is under control of business because, if business starts selling with more ads, his selling will surely increase. 4th Competitors Competitors of business also create internal business environment. According to competitors, policies, business changes his policies for winning in competition. 5th Financial Intermediaries As business grows, it needs more money for his growth; either this money can be gotten by issuing new shares or by borrowing money from financial intermediaries. So, financial intermediaries plays a vital role in business environment. If they provides loan at very low rate, at that time business can get and grow fastly but, if they increase in interest rate, at that time business will not get at this rate and its

growth may decrease due to lack of fund.

Macro Business Environment or External Factors of Business Environment:1. Economical Environment Economic environment is main element of business environment. Economy is factor which affects business with following way:-

A) Economic policies Economic policies related to budget , industrial policy , fiscal policy , export and import policy and business should see what changes are done in these and business has to changes their business policies according to these changes .

B) Economic regulation Different laws and regulations are at international level and national level . These are all called economic regulation and business has to respect all of these while it is operating business . 2. Natural Environment Natural environment is also external factor of business . Because , business can not fully control on natural environment . Many points like season , raining , floods , earth quake are natural and happens according to fluctuation in it . These are also main element of business because business has to face all these factors . But some of loss from these factors can be transferred with effective schemes of insurance . 3. Demo graphic Factors

Size of population and their growth rate includes in demo graphic element and factor of business environment. Increasing trend of population will increase demand of products and support business to produce more products. But if death rate is increasing or demo graphic factor like religion are preventing to use the products of business. At that time business has to change their business or make other plans according to situation. 4. Technological Environment : This is fully concerned with changing of technology and its effect on product . Many technical products are fastly changed by coming new technology .At that time business also have to cover new products according to changes in technology . 5. Political Environment Political environment is composition of three factors which are following a) legislature b) executive c) judiciary All above factor affects business and business has to make rules and regulation according to Govt. and political rules and regulation. 6. International Environment International environment includes WTO, IMF, WB, SARC and G20 meetings and their rules and regulations can effect on any type of business. Business has to exist in world market, and then it should understand their effect and take action according to these rules and regulation. Definition of Economic Environment Economic environment is very important factor of business. It means any environment which becomes from economic system, economic planning and economic policies. Main motive of this environment is to effective utilization of resources. From above definition we get three factor that are :

1. Economic system Economy works always in any system There are main three economic systems; any country can adopt any system for making economic planning and economic policy. a) capitalistic economy In this economy all powers are in private hands, they are free to choose any business and also invest money in any type of business. Govt. just cares the security of country and life of people but it does not disturb to anyone on the basis of business. This economy is in USA. b) Socialistic economy This economy is basically in poor and developing countries and main motive of this economy is to welfare of people and develop the economy. In this economy all businesses are under fully control of govt. and nobody can operate any business freely. Govt. makes rules and regulation for operating business and also appoints authorities for operating it. Because, all powers are in the hand of govt., so there are huge chances of corruption in govt. departments. c) Mixed economy : Any country in which both capitalistic and socialistic economy works, and after mixing of both economy, the new economy will comes in our eyes that is called mixed economy. In this economy govt. fixes some sector which are reserves only for govt. investment and no private person can do that business. India is the good example of mixed economy. 2. Economic policies An economic policy means any policy which is related to fund of

nation and its utilization. It also includes fiscal policy and budget of nation. 3. Economic planning For equal distribution of money and wealth, it is very necessary to make economic plans of development in socialistic economy. These plans are known as economic plans.

Legal environment of business in India and List of Different Indian Acts which affect business Legal environment of business means all factors relating to laws and legal orders which affect business and its working. Business must be operated under the rules and regulation of different laws of India. The following is the list of main laws which affect business.

1. Indian contract act 1872 2. Indian sale of goods act 1930 3. Indian partnership act 1932 4. Industrial dispute Act 1947 5. Minimum wages act 1948 6. Indian companies act 1956 7. Foreign exchange regulation act (FERA ) 1973 8. Foreign exchange management act 1999

9. Monopolies and restrictive trade practice act 1969 10. Consumer protection act 1986 11. Indian income tax act 961 12. Central excise act 1944 13. Security exchange board of India act 1992 14. Banking regulation act 1949 15. Chartered accountant act 1949 16. Information technology act 2000 17. competition act 2002 18. right to information act 2005 19. Micro, Small and Medium Enterprises Development Act,2006 20. Commissions for Protection of Child Rights Act,2005 TUESDAY, MAY 5, 2009 The Consumer Protection Act 1986 and its main provisions and features Govt of India has made consumer protection act in 1986. The main aim is to protect consumers from immoral practice of business organizations. We see in general when a company or business concern becomes monopolize in market , then that company starts to get benefits of his monopoly powers by illegal ways. This law is very helpful to secure consumers and customers from such cheating and market frauds.

Main features of Consumer protect Act 1986 Under this act, consumers have right to get information of quality, quantity and price of products. Under this act, consumer has power to sue in district forum and report or complaint against the cheating of businessmen to the authorities and get remedies for this. This act also awakes consumers regarding their rights and powers. In other words, it helps to educate consumers about his rights. After spending one decade this act becomes more strict for all cheaters who commit cheating with consumers. Main authorities under Consumer protect act 1986 District forum This forum has power to solve the problems of consumers up to Rs. 500000 at district level. State govt. has power to make suitable numbers of district forum for protecting the rights of consumers. This forum can be made by district judge and other experienced persons in the field of law and commerce. State commission

Consumer can also appeal to state commission against the decisions of district forum. State commission has power to solve the problems of consumers from Rs. 500000 to Rs. 2000000. This commission can be made by state high court judges and 2 experts in the field of commerce and laws.

National Commission

National commission has power to solve all consumers disputes and problems more than 2000000 Rs. The chairperson of this commission will be the retired Supreme Court judges and other 4 experts in the field of commerce and laws and industry. Out of four, it is necessary to include one lady member in the four expert team.

IMF and its objectives, functions and membership What is IMF ? IMF is UNO recognized international monetary fund or reserve which helps its members. It established in 1946 after bretton wood meeting. It has 185 members across the all nations but soviet Russia and its member are not linked with IMF. All work is done by its board of directors which is made by board of governors. Every countrys finance minister is as the governor from his respective country. There are two type directors in board of directors of IMF. One is quota and other is non quota. USA, UK,

Germany and India are quota country and one member is taken in board of directors and other from non quota countries. Total no. of directors are 20.

Objective and functions of IMF 1. Provide loan to the members for removing unfavorable balance of payment. 2. Determine the value of currency of member countries. 3. Determine the economic policies main contents of members countries. 4. To make plan for increasing per capita income of member countries. 5. To collect money from member countries in the form of fun or reserves. 6. Latest objective in IMF is that it will support 3 trillion dollars under his budget for decreasing the pressure of 2000 recession. Eligibility for membership in IMF

Any country can become the member of IMF but for getting eligibility the following procedure is adopted by IMF.

First of all membership is accepted by board of directors after accepting membership , board of directors send this proposal to

board of governors with supported all documents and subscription and quota amount as per the terms of membership . World bank or IBRD World Bank is international financial institution for reconstruction and development of member countries. So, its other name is international bank of reconstruction and development (IBRD). This bank is established in 1944 after bretton woods meeting of 20 major countries. This bank provides long term loan to its members and all work is done by executive directors which is nominated by shareholders of member countries and board of governors.

Bank has own 20 billion dollar paid up capital. Bank provides loan but before providing loan it sees the project and after accepting project, the loan is given under strict terms and conditions of World Bank. In which includes the interest on loan, commission and administration charges. GATT and its functions and policies In 1944 , developed countries participated in bretton woods meeting . In this meeting they wanted to make international

trade organisation but all countries could not agree on its terms but 1948 , they had made a general agreement for tariffs and trade after signing GATT in 1947 by 23 countries including India. Now no. of member countries reached up to 184 .

Objectives and functions of GATT 1. Reduce international restriction 2. Reduce tax problems

1. Development in international trade Policies of GATT 1. Non discrimination policy

2. No quantitative restrictions 3. Opinions New in Asian Development Bank Asian development bank is established in 1966 under the direction of united nation economic commission for Asia and for east . Its main objective is to help Asian countries . It provides loans to Asian countries . From time to time , it also provides technical help to Asian countries . It also establishes his good links with UNO , IMF and world bank for promoting developing activities in Asian and east countries .

Membership

All members of UNECFAE are also members of ADB . At 2007 it has 67 members .

Capital of ADB

1. total capital is 7965.1 million dollars and its one half is paid up and other one half is called up capital

2. It can also collect more capital by issuing new shares in world share market .

Organisation of Bank

1. Board of governers

2. Board of directors - total 10 directors board

3. president - elected for 5 years out of board of directors . WTO and its functions and policies Full form of WTO is world trade organisation . It is an international organisation which established after conversion of GATT in 1995 . In 1944 , when bretton woods conference was completed . In that meeting leaders of developed countries wanted to make international trade organisation but they accepted only GATT's policies in 1948 . AfterUruguay discussion , all GATT members included in WTO . Main objective of making WTO is to reduce restrictions in international trade with more globalisation and liberalisation policy.

Functions and policies of WTO 1. Reduction of the rate of Tariffs : Tariffs means tax on imported goods . For developing international trade , it is compulsory to all member countries to reduce 24 % to 30 % tariffs with in 6 to 10 years . 2. Reduction the subsidy to domestic trade For more smooth competition , WTO has made rule to reduce the amount of subsidy or other assistance which is given by govt. to their domestic industry . 3. TRIPS Trips means trade and intellectual property rights . WTO has made some rules for prohibiting piracy in intellectual property rights . All countries will have to accept these trips . 4. Other GATT rules Some of GATT rules will still apply Social Environment of Business >> NOVEMBER 3, 2009 22 32 2998

Meaning of Social Environment

Social or Societary environment of business means all factors which affects business socially . Every business works in a society , so societies ' different factors like family , educational institutions and religion affects business .

Main elements Of Societies and its effect on Business

1. Family :- Family is basic part of society from the birth of a person and upto death , he lives in family so personal decision of buying and selling of goods are affects from family . In the culture of a family , it may happen that parent does not allow to use any product , then sale of such product will decrease , so businessman must analyze different families needs . Many occasion of family like marriage of any family member , can increase the demand of goods .

2. Educational institutions :- Educational institutions are also main part of societies . They provide good knowledge , education , awareness , thinking what should students buy or not to buy . Suppose if a student is habitual to drink the tea and if his teacher advice him that this is harmful to his health after his guidance students can avoid to drink tea after this the sale of tea will decrease . 3. Religion :- Like family and education institution , religion is also effects the business socially . Religion means the system in which group of persons trust in God . They believe that there is one supernatural power in this earth and its name is God . They gives many name like Ek onkar sat nam , om and many more etc. Different religions have different principles , rules and regulations in which they sacrifice to use some products and to eat some food , in Hindu religion , they never use leather products . They affects the sale of leather industries . So, businessman must analyse the targeted audience and after listening their religious thoughts , he should produce the goods . Social Responsibility of Business and Points in Favour and Against of it >> NOVEMBER 4, 2009 13 17 559

Meaning of Social Responsibility of Business

Social responsibility is the duty of businessman to help the society to solve its major problems . Every enterprise is fully connected with society . He takes many things from society in the form of raw material , work from employees and also pollute environment of society. After this , many social problems rise due to pollution . So businessman's prime duty is to support in the form of plantation near the area of factory providing free health facilities to employees and also donate some part of profit for welfare of poor community to uplift them . These days trends shows that almost all companies are taken steps for becoming responsible toward society .

Arguments in favour of social responsibility :-

1. To increase reputation of society :-

Businessman sells the goods to the customers and customers are the social person .If businessman is responsible towards society , then he can increase his reputation in society . This is the one of most important argument that after providing good quality of goods at lower price and providing other free facilities to customers , business can grow his business.

2. Business legal obligations :-

Some law are made in India to reduce population . So businessman must follow these rules and regulations and after this he can save from government penalties . According to this argument businessman should come forward for doing social work. After this he can respect the law .

3. More Public expectation from business :-

In the modern time it may be argued that businessman should fulfil the expectation of public . Businessman gets raw material from very low cost and after producing he sells at very high cost . So it is the duty of businessman to share his some profit in the form of donation.

4. Business has useful resource

Many wise person from society gives argument that business has skill , experience and money resources and innovation mind . If these resources are used to solve social problem , then society can rich with in some year .

5. Better Environment from business

If a business gives good working condition to employee then it will provide better environment for business . How will it possible.

Good facility in factory and provide high wages to labourer

will reduce the absenteeism

will reduce labourer turnover

will reduce labourer crime.

Argument against Social responsibility

1. Cost of social work

Business has already limited resource. So , if it is used in social work then business activity may slow and business's expenses will increase and it will affected business inversely.

2. Businessman is not expert in social work :-

Businessman is not expert in social work . Because he has not done MSW . Master of social work is higher qualification for doing social work and fulfilling social responsibility as social and moral agent . So , without perfect knowledge , business should not do any social activity but concentrate only on his business .

3. Social responsibility is not legal responsibility :-

Some businessman argue that social responsibility is not legal responsibility , no one pressure on business man to give donation under any law .

4. International competition

One of important argument is given by Indian businessman that they have to face international competition . After adopting some social responsibility , it will increase the prices of their product and after competition our business will fail and foreign companies will win in competition.

5. Ignore Business Aim :-

It is the duty of Govt. to do that social activities and if a businessman ignore his business aim and start social activities , then after ignoring business aim businessman can succeed in business.

Conclusion

In very brief , we can give the conclusion of this debate that business should concentrate on business activities but also do social activities which promote the business. He can give small amount of donation and provide good services to employee and society . Technological Environment >> NOVEMBER 7, 2009 30 43 3652

Definition of Technological Environment :-

Technological Environment means the development in the field of technology which affectsbusiness by new inventions of productions and other improvements in techniques to perform the business work. "

Explanation

We see that in 21st century, technology is changing fastly. Now, all work is done online and business shops are using machinery at high level. There are following technological environment factors which affects business.

New inventions to produce the products.

 New inventions relating to marketing like BPO for selling online in international market.

Status of Technological Environment or Technology in India :-

After Independence, India had basic problems like poverty , unemployment and development of India . Indian Govt. has taken many following steps for technological development.

1. Establishment of technological and research institute

Indian govt. has established 500 technological institutes for providing education to Indian students. It has also established 1080 research institutes. In these institutes major names like space research centre, medical research centre and agricultural research centre have developed India technically.

2. Positive Technical policy

India has strong and positive technical policy for technological development. This policy opens door to import technology from foreign countries for increasing agricultural and industrial developments.

3. High Growth Rate of Information Technology in India

In India, IT sector is developing with 35% growth rate, India is second country after China who is using internet at large scale for e-commerce , e-education and e-accounting .

4. Incentive for promoting Technology in India

Indian Govt. has given 100% income tax exemption for expenses incurred in research of technology in India.

Transfer of Technology and its main method >> NOVEMBER 9, 2009 0 9 9

Definition of Transfer of Technology

Transfer of Technology means to sell the technology or to provide technology to other for getting money from that person. Technology includes skill, knowledge and new and fast production techniques and any organization will give it only after getting its fees that may be license fees. After this second party can share that technology for their own purposes.

Main methods of Transfer of Technology

1. Transfer of Technology by providing training to employees of company

If any company is started the work of training to employees of different company . By this way they can transfer their technology to the employees after learning skills , employees can work more technically.

2. Transfer of Technology by giving license

By this way company can also transfer of technology, Microsoft is the one of example of this; you can buy the license to use the different softwares of Microsoft company. For this Microsoft Company will take fees for this.

3. Transfer of Technology by selling of machinery and equipment

This is also another method of transferring the technology.

Company can make any machine or equipment and it is finished with all technology by selling this machine or Equipment Company can transfer the technology.

4. Making of Partnership or joint venture programme

Under this method company does not sell the technology but technology becomes fixed investment in partnership or joint venture. One party brings technology and other party brings money and both start a new business.

5. by Expert Services

Under this method, expert can transfer of technology by giving his professional services and takes fees. Economic Policies >> NOVEMBER 11, 2009 0 12 20

Definition of Economic Policies

All policies which are made for development of economy and its stability are called economic policies. Last year economic crisis and after coming its main roots, economic policies are become most important and every country makes its after deep research and analysis.

Followings are the main economic policies:-

1. Industrial Policies :-

Industrial policies are the one of the important part of economic policies. For working of industry in peace environment, these policies are made. These policies may be different according to the size and location of industry.

2. Trade Policies:-

Trade policy is relating to import and export of goods. Govt. makes trade policy for protecting domestic industry by levying of tax on import.

3. Foreign exchange policy:-

It is also the part of economic policy. For exchanging the currency and better movement of international capital, these policies are made in international capital market.

4. Foreign investment and technology policy:-

This policy is very helpful for getting large amount in form of foreign investment and high skill in form of technology. Govt. makes this policy more liberalized to attract foreign investors.

5. Fiscal Policy:-

Fiscal policy is very advance tool to promote economy. Govt. can reduce the rate of indirect tax for removing recession from

country under fiscal measurements .

6. Monetary policy:-

Monetary Policy is made by central bank of any country. RBI uses several tools of monetary policy like bank rate, open market operations and direct regulations.

Critical Role of Economic Policies:-

In India, there are approximate six economic policies and policies are so important for development of India economy. But there are also many shortcomings, we can see in these , which we can explain following way :-

Industrial policies affect on domestic industry adversely. Govt. promotes only big companies.

 Economic policies can be criticized that these are affected from world economy which can not be controlled by govt.

Govt. has no direct control on monetary policies due to the control of RBI. So, it is less represented by public.

Liberalized foreign investment are decreasing the portion of public sector.

Definition of Monetary Policy

Monetary policy is that part of economic policy in which central bank controls the cost and supply of money and credit by applying different techniques. It is also main function of central bank. We all know, if supply and cost of money are not controlled. Then both are harmful for development of economy. In India RBI is sole institute who is taking steps to regulate money and credit by controlling its supply. Monetary policy regulates both volume and value of currency and credit.

Objective of Monetary Policy

To control the supply of money. To control the cost of money and credit. Exchange stability Full employment

Instruments or technique of credit control / monetary policy:-

1. Bank Rate

Bank rate is that rate which is charged by Central bank for issue loan to the member banks. By changing it, central bank can control the credit.

If Central bank increase this bank rate, all commercial banks will increase their interest rate by this loan become costly and flow of fund in the form of credit will decrease.

If central bank wants to expand credit, then Central bank will decrease bank rate, after this commercial bank can get advance and loan at cheap rate and by this way, they also decrease their interest rate. After this flow of cash in the form of loan will increases.

2. Open Market Operation

Open market operation is the all action which is done by central bank for purchase and sale of member banks' security in open market. If RBI wants to contract the credit, then RBI will sell the security of member bank and member bank's flow of cash will stop. If RBI wants to expand credit in recession, then RBI will start to buy the security of member banks and member banks get cash and they can now use it for providing more loans to customers.

3. Cash Reserve Ratio / Statutory minimum reserve:-

Cash reserve ratio is the minimum percentage of the deposit to be kept as reserve by the banks with central bank. It can be used as the technique of monetary policy. By changing cash reserve ratio, RBI can contract or expand credit in Indian economy.

If RBI wants to contract credit, and then RBI will increase this ratio. After this all banks have to keep more fund as reserve with RBI. So, they will decrease the amount of loan due to decrease the total fund available for enterprises.

 If RBI wants to expand credit, then RBI will decrease this ratio, after this all banks have to keep less fund as reserve with RBI. So, they will issue more credit to public.

4. Changes in Marginal Requirement of loan:-

Marginal requirement is the difference between value of security and actual loan accepted by bank. Suppose a person wants to take loan of Rs. 80 , we has to give security of Rs. 100 then marginal requirement is Rs. 100 - Rs. 80 = Rs. 20 .

If RBI wants to contract the credit , this rate will increase suppose , if RBI fixes it as 40 % , then customer can get loan of Rs. 60 after giving security of Rs. 100 . So , trend of getting loan will decrease .

If RBI wants to expand the credit, this rate will decrease suppose, if RBI fixes it as 10% more people will take loan , if they get Rs. 90 in cash after giving security of Rs. 100 .

So , by this way RBI controls credit .

5. Moral Persuasion / Inspiration

RBI as central bank of country can control credit with moral persuasion. Under thispersuasion, RBI can call a meeting of all commercial bank and give advice in discussion that they should not give loan for speculative purposes.

6. Rationing of Credit

RBI has right to create ration of credit under monetary policy. It can be done by following way:-

To fix the amount of loan for a particular bank. To fix Quota for all banks. To fix Quota for different traders.

7. Regulation of consumer credit

In case inflation, prices are increased. To control prices central bank contract credit to reduce the total amount of installment for payment.

 In case of deflation, prices are decreased to control prices central bank expand credit to increase the amount of installment. Definition of Fiscal Policy

Fiscal Policy is the main part ofEconomic Policy and Fiscal Policy's first word Fiscal is taken from French word Fisc it meanstreasure of Govt. So we can define fiscal policy as the revenue and expenditure policy of Govt. of India .It is prime duty of Government to make fiscal policy . By making this policy , Govt. collects money from his different resources and utilize it in different expenditure . Thus fiscal policy is related to development policy . All welfare projects are completed under this policy . Objectives of Fiscal Policy There are following objectives of fiscal policy :1. Development of Country :-

For development of Country , every country has to make fiscal policy . With this policy , all work work is done govt. planning and proper use of fund for development functions . If govt. does not make fiscal policy , then it may happen that revenue may be misused without targeted expenditure of govt.

2. Employment :-

Getting the full employment is also objective of fiscal policy . Govt. can take many action for increase employment. Government can fix certain amount which can be utilized for creation of new employment for unemployed peoples .

3. Inequality :-

In developing country like India , we can see the difference one basis of earning . 10% of people are earning more than Rs. 100000 per day and other are earning less than Rs . 100 per day . By making a good fiscal policy , govt. can reduce this difference . If govt makes it as his target .

4. Fixation of Govt. Responsibility :-

It is the duty of Govt. to effective use of resources and by making of fiscal policy different minister's accountability can be checked . I was seeing the Episode of Chanakya on YouTube in which I found that in old time fiscal policy was made and treasury officer and even prime minister are also responsible for any shortage of govt .fund . See the video

Techniques of Fiscal Policy 1. Taxation Policy Taxation policy is relating to new amendments in direct tax and indirect tax . Govt. of India passes finance bill every year . In this policy govt. determines the rate of taxes . Govt. can increase or decrease these tax rates and amend previous rules of taxation .Govt.'s earning's main source is taxation . But more tax on public will adverse effect on the development of economy. If Govt. will increase taxes , more burden will be on the public and it will reduce production and purchasing power of public . If Govt. will decrease taxes , then public's purchasing power

will increase and it will increase the inflation. Govt. analyzes both the situation and will make his taxation policy more progressive . 2. Govt. Expenditure Policy There are large number of public expenditure like opening of govt schools , colleges and universities , making of bridges , roads and new railway tracks . In all above projects govt has paid large amount for purchasing and paying wages and salaries all these expenditure are paid after making govt. expenditure policy . Govt. can increase or decrease the amount of public expenditure by changing govt. budget . So , govt. expenditure is technique of fiscal policy by using this , govt. use his fund first on very necessary sector and other will be done after this . 3. Deficit Financing Policy If Govt.'s expenditures are more than his revenue , then govt. should have to collect this amount . This amount is deficit and it can be fulfilled by issuing new currency by central bank of country . But , it will reduce the purchasing power of currency . More new currency will increase inflation and after inflation value of currency will decrease . So, deficit financing is very serious issue in the front of govt. Govt. should use it , if there is no other source of govt. earning . 4. Public Debt Policy If Govt. thinks that deficit financing is not sufficient for fulfilling the public expenditure or if govt. does not use deficit financing , then govt. can take loan from world bank , or take loan from public by issuing govt. securities and bonds . But it will also increase the cost of debt in the form of interest which govt. has to pay on the amount of loan . So, govt. has to make solid

budget for this and after this amount is fixed which is taken as debt. This policy can also use as the technique of fiscal policy for increase the treasure of govt. Limitation of Fiscal Policy 1. After issuing new notes for payment of govt. of expenses , inflation of India is increasing rapidly and in this inflation , prices of necessary goods are increasing very fastly. Living of poor person has become difficult . So , these sign shows the failure of Indian fiscal policy. 2. Govt. fiscal policy has failed to reduce the black money . Even large amount of past minister is in the form of black money which is deposited in Swiss Bank. 3. After taking loan from world bank under the fiscal policy's debt technique , govt. has to obey the rules and regulations of world bank and IMF . These rules are more harmful for developing small domestic business of India. These organisation are inter related with WTO and they want to stop Indian domestic Industry.

4. After expending large amount for generating new employment under fiscal policy , rate of unemployment is increasing fastly and big lines on govt. employment exchange can be seen generally in working days . Database of employment exchanges are full from educated unemployed candidates .

Monopoly and Restrictive Trade Practice (MRTP ) Act 1969 and its Provisions

>> NOVEMBER 17, 2009 8 33 353

After 1947 , many big firms had entered in Indian economy and they were trying to operate business without any competitors . Govt. of India had understood the policy of big Corporate firms and for safeguarding the interest of consumers , Govt. of India has passed the bill of MRTP and made the monopoly and restrictive trade practise Act 1969 . After activation of this law , no company can promote monopoly and other restrictive trade activities . MRTP commission has power to stop all business activity who are creating barrier in the way of competition in Indian economy.

In this law , RTP is defined deeply and many provisions explains what are activities are restrictive .

Now , this act is converted into Competition Act 2002 and MRTP commission is converted into Competition commission.

Main Provisions of Competition Act 2002 >> NOVEMBER 17, 2009 5 18 599

In 1969 Govt. has passed an act and it had given the name monopoly and restrictive trade practices (MRTP). It became popular with the name of MRTP 1969. This act has many provisions to control the monopoly and to promote the competition. It has defined RTP and also explained the powers of MRTP commission. But its scope was very narrow and Govt. of India has made new act called competition act 2002. On the place of MRTP ACT 1969 after this MRTP act 1969 was fully repealed.

Explanation of Competition Act 2002

Competition Act 2002 states that Indian traders must not do any activity for promoting monopoly. If they will do any activity in the form of production, distribution, price fixation for increasing

monopoly and this will be against this act and will be void. This act is very helpful for increasing good competition in Indian economy.

Under this act following are restricted practice and these practices are stopped by this act.

1. Price fixing:-

If two or more supplier fixes the same price for supply the goods then it will be restricted practice.

2. Bid ragging:-

If two or more supplier exchange sensitive information of bid, then it will also be restricted practice and against competition.

3. Re-sale price fixation:-

If a producer sells the goods to the distributors on the condition that he will not sell any other price which is not fixed by

producer.

4. Exclusive dealing:-

This is also restricted practice. If a distributor purchases the goods on the condition that supplier will not supply the goods any other distributor.

Above all activities promote monopoly so under competition act these are void and action of competition commission will not entertain by civil court.

Establishment of Competition Commission Under this law

Govt. of India appoints the chairman and other member of competition commission. Competition act 2002 gives the rules and regulation regarding establishment and functions of this commission.

Qualification of chairperson of Competition commission:-

He or she should be Judge of high court + 15 years or more experience in the field of international trade , commerce , economics , law , finance , business and industry .

Function of Competition commission:-

1. To stop activity and practice which are promoting monopoly. 2. To promote the competition. 3. To protect the interest of consumers.

Conclusion:-

India is doing all work for safeguarding the interest of consumer and this law is one of the important pillar in this way.

Information Technology Act 2000 >> NOVEMBER 20, 2009 7 20 1448

Introduction of Information Technology Act 2000

Information technology is one of the important law relating to Indian cyber laws. It had passed in Indian parliament in 2000. This act is helpful to promote business with the help of internet. It also set of rules and regulations which apply on any electronic business transaction.

Due to increasing crime in cyber space, Govt. of India understood the problems of internet user and for safeguarding the interest of internet users, this act was made.

The following are its main objectives and scope:-

1. It is objective of I.T. Act 2000 to give legal recognition to any transaction which is done by electronic way or use of internet.

2. To give legal recognition to digital signature for accepting any agreement via computer.

3. To provide facility of filling document online relating to school admission or registration in employment exchange.

4. According to I.T. Act 2000, any company can store their data in electronic storage.

5. To stop computer crime and protect privacy of internet users.

6. To give legal recognition for keeping books of accounts by bankers and other companies in electronic form.

7. To make more power to IPO, RBI and Indian Evidence act for restricting electronic crime.

Scope

Every electronic information is under the scope of I.T. Act 2000 but following electronic transaction is not under I.T. Act 2000

1. Information technology act 2000 is not applicable on the attestation for creating trust via electronic way. Physical attestation is must.

2. I.T. Act 2000 is not applicable on the attestation for making will of any body. Physical attestation by two witnesses is must.

3. A contract of sale of any immovable property.

4. Attestation for giving power of attorney of property is not possible via electronic record.

Highlights the main chapters of I.T. Act 2000 or its main provisions:-

There are 13 chapters in law and all provision is included in this chapters.

1. Chapter II

Any contract which is done by subscriber. If he signs the electronic agreement by digital signature. Then it will be valid.

In case bank, the verification of digital signature can be on the basis of key pair.

2. Chapter III

This chapter explains the detail that all electronic records of govt. are acceptable unless any other law has any rules regarding written or printed record.

3. Chapter IV

This chapter deals with receipts or acknowledgement of any electronic record. Every electronic record has any proof that is called receipt and it should be in the hand who records electronic way.

4. Chapter V

This chapter powers to organization for securing the electronic records and secure digital signature. They can secure by applying any new verification system.

5. Chapter VI

This chapter states that govt. of India will appoint controller of certifying authorities and he will control all activities of certifying authorities.

Certifying authority is that authority who issues digital signature

certificate.

6. Chapter VII

In this chapter powers and duties of certifying authority is given. Certifying authority will issue digital signature certification after getting Rs. 25000. If it is against public interest, then C.A. can suspend the digital signature certificate.

7. Chapter VIII

This chapter tells about the duties of subscribers regarding digital signature certificate . It is the duty of subscriber to accept that all information in digital signature certificate that is within his knowledge is true .

8. Chapter IX

If any body or group of body damages the computers , computer systems and computer networks by electronic hacking , then they

are responsible to pay penalty upto Rs. 1 crore . Fore judgment this , govt. can appoint adjucating officer .

9. Chapter X

Under this chapter, cyber regulation appellate tribunal can be established. It will solve the cases relating to orders of adjudicating officers.

10. Chapter XI

For controlling cyber Crime, Govt. can appoint cyber regulation advisory committee who will check all cyber crime relating to publishing others information. If any fault is done by anybody, he will be responsible for paying Rs. 2 lakhs or he can get punishment of 3 years living in jail or both prison and penalty can be given to cyber criminal.

11. Chapter XII

Police officers have also power to investigate dangerous cyber

crime under IPC 1860 , Indian Evidence Act 1872 and RBI Act 1934 .

Advantages of I.T. Act 2000

1. Helpful to promote e-commerce

Email is valid

Digital signature is valid.

Payment via credit card is valid.

Online contract is valid

Above all things validity in eye of Indian law is very necessary. After making IT act 2000 , all above things are valid and these things are very helpful to promote e-commerce in India .

2. Enhance the corporate business

After issuing digital signature, certificate by Certifying authority, now Indian corporate business can enhance.

3. Filling online forms :-

After providing facility, filling online forms for different purposes has become so easy.

4. High penalty for cyber crime

Law has power to penalize for doing any cyber crime. After making of this law, nos. of cyber crime has reduced.

Shortcoming of I.T. Act 2000

1. Infringement of copyright has not been included in this law.

2. No protection for domain names.

3. The act is not applicable on the power of attorney, trusts and will.

4. Act is silent on taxation.

5. No, provision of payment of stamp duty on electronic documents.

Definition of FEMA 2000

FEMA 2000 means Foreign exchange management Act 2000. Foreign exchange management act 2000 is very helpful law for development of foreign exchange market in India. It was passed in 1999 and came into effect from June 1, 2000 to entire country. After this foreign exchange regulation act ( FERA ) 1973 was closed . FEMA was most suitable for India corporate sector instead of FERA because almost all strict regulations of FERA were removed in FEMA .

Objectives of FEMA

1. Main objective of apply FEMA is to reduce the restriction on foreign exchange . Now , any offense in foreign exchange will be civil offense not criminal offense .

2. This law's main objective is to increase the flow of foreign exchange in India. Now , under this law , you can bring foreign currency in India without any legal barrier .

Provision /Rules / Regulation of FEMA

1. Provision regarding dealing in foreign exchange :-

According to section 3 of FEMA 2000 ," only authorized person under the govt. terms can deal in foreign exchange in India . "

2. Provision regarding holding of foreign exchange :-

According to section 4 of FEMA 2000, " All persons which are provided authority only can hold or purchase foreign exchange in India or outside India."

3.Provision regarding current account transactions :-

According to section 5 of FEMA 2000 ," There is no restriction regarding sale or deal foreign exchange , if it is a current account transaction ."

The following transaction are deemed current account transactions under FEMA :-

a) Expenses in connection with foreign travel , education and medical care of parents , spouse and children ( Any body now can send the foreign currency in India for above expenses under current account ) b) Payment due as interest on loan c) Payment due under short term loan for business .

4. Provision regarding capital account transactions :-

Under section six ," RBI will fix the limit of foreign exchange transactions relating to capital account after discussion with Indian govt. "

RBI can restrict following :-

a) transfer of foreign security by Indian resident . b) transfer of foreign security by Indian resident which is now outside India . c) transfer of immovable property .

5. Provision regarding export of goods and services :-

According to section 7 of FEMA 2000 , " It is the duty of exporter to declare the true and correct detail of goods which , he have to sell the market outside India and must send complete report to RBI .

RBI can make particular requirement for any exporter .

RBI can also make rules and regulations for realization of amount earned from foreign country.

6. Provision regarding authorised persons :-

RBI can authorize any body who can deal in money exchange or off shore transaction and foreign exchange .

He has to follow the rules and guidelines of RBI . RBI can revoke the authorisation granted to any person at any time in public interest . If authorized person will be done contravention the rules of RBI , he will be liable to pay up to Rs. 10000 penalty and Rs. 2000 for every day during which such contravention continue . 7. Provision regarding contravention and penalties :Section 13 to 15 If any body or person contravenes the rules and regulation of

FEMA 2000 or RBI direction , he will be liable to a penalty three times of sum involved in contravention . If contravention will continue , then he will pay upto Rs. 5000 per day during the time of contravention . 8. Provision regarding adjucation and appeal :According to section 18, " Central govt. can appoint adjudicating authority who can give the punishment of civil imprisonment of maximum six months if case is less than one crore . If demanded value is more than one crore then punishment of imprisonment may be of three years . the person can appeal to special director against the decisions of adjudicating officer . He can also appeal in appellate tribunal and also in high court with the sixty days of communication of order .

Definition of Development Bank

A development bank is a financial institution which provides loan and other financial assistance to businessmen for development of enterprise . Features of Development Bank

1. Providing loan for development of business of enterprise . 2. Loan is given on project basis not on the basis of security . 3. It provides loan at cheap rate of interest . Functions of Development Bank

1. Providing loan at cheap rate Development bank takes interest at very low rate and from time to time , they issue new scheme of loan in which rate of interest is very low . 2. Provide advice and guidance Development bank provides advice to the businessman about which project is best . It is also function of development bank is to guide to businessman about how to use the loan . 3. Providing facility of refinancing of Commercial banks Large numbers of commercial bank gets the refinance facility from development bank. Refinance means getting the finance for further distribution of loan to customer . 4. Providing underwriting services These days development bank are also providing the facility of underwriting in which development bank promises to sell all the shares of company . For these services development bank gets some commission from companies . Lending procedure of Development bank Step one Checking the project Customer wants to get the loan , he will apply for same . He will attach his project with his application after this development bank will check the project . It will see the following points .

What amount of capital is investing by businessman . Size of infrastructure .

What is the major transport facility for distribution of products . Availability of raw material After checking the above points development banks decides to give loan or not . Step Second Other Govt. formalities Development bank also checks whether the customers has fulfilled all the formalities of govt. or not . Whether he obtained license or not . Step Third Acceptance of loan : If project is good and customers fulfills all the conditions of govt. , then development bank will accept the project and issues the loan to customers bank account . Step Fourth Follow Up After giving loan , development bank guides customers , how to use loan effective way for achievement in project under follow up step . Structure of Financial Institute in India >> NOVEMBER 26, 2009 0 11 37

Following is the structure of financial institute in India .It has divided into two parts . One part is national financial institute and

other part is state level financial institute .

development bank, mba + bank, structure FTDR Act 1992 >> NOVEMBER 26, 2009 0 24 97

Foreign trade development and regulation act was passed in 1992 . After this , old export control act 1947 was closed . All export and import are done by FTDR Act 1992 . FTDR Act is helpful to promote export and import without any restrictions . Main provisions

1. Reduce restrictions This act's provisions are relating to reduce the restrictions on foreign trade . 2. EXIM Policy This provision gives power to govt. of India to make policy of export and import under this act. 3. Appointment of Director general of Foreign trade This act also powers to govt. of india to appoint director general of foreign trade . DFGT will advise for making exim policy . 4.Importer exporter code no. Under this law , any body can export or import only after getting I-M-C-N from director general of foreign trade . 5. Issue of license Export or import can be done under license issued by DGFT 6. Search and Seizure Authorized person can search whether goods are imported or exported under term and conditions of FTDR Act 1992. 7. Penalty for contravention If anybody contravenes the rules and regulations of FTDR Act 1992 , then he has to give 1000 rupees or 5 times of value of goods involve whichever is more . What is ISO ? Explain its Standards ISO 9000 and ISO 14000 . Discuss Its Objectives , working and Versions

>> NOVEMBER 28, 2009 2 10 540

The following contents are covered under Business Environment of MBA First semester Meaning of ISO ISO means international standard organisation . In business environment , ISO word is so famous and International organisation provides standards to those business oraganisations who fulfill its conditions . It has authority to issue certificate of quality management and quality environment . There are large numbers of business organisation who satisfy the conditions . They have ISO certificate . ISO's official site is at the url http://www.iso.org/iso/home.htm ISO (International Organization for Standardization) is the world's largest developer and publisher of International Standards. This organisation has made by participation of all countries .Its central secretariat is in Geneva , Switzerland .It is NGO which helps to promote business by providing them solution of quality problems . Meaning of ISO 9000 This is the latest version of International organisation for standardisation which gives to those organisation who satisfy the following condition 1. It fulfills the quality requirements of customers . 2. It fulfills regulatory requirements .

3. Customers satisfaction 4. Continual improvement in quality management . 5. Records should show how and where raw materials and products were processed, to allow products and problems to be traced to the source. 6. You need to test and document whether the product meets design requirements, regulatory requirements and user needs. Meaning of ISO 14000

ISO 14000 is standard certificate which gives to those business organisation who fulfill the conditions relating to quality environment . Quality environments means all measure to protect the environment from pollution .

Conditions

1. Company has minimized harmful effect on environment by proper control on waste and pollution. 2. Achieve improvement in its environment performance by planting the trees and other projects . 3. ISO 9000 and ISO 14000 are given after taking test of products who apply for same and ISO takes also some fees for issuing the certificate . There is no guarantee , any quality of end products but almost all ISO products are high quality . 4. The certificate will be for three years and after this product will again review for giving certificate . Objectives of ISO 9000 and ISO 14000

1. To Increase the goodwill of company

Main objective of getting these standards is to increase the goodwill of company. Customer can compare the quality of two companies , one is with ISO standard and other is without ISO standard . Goodwill may be in form of increase in sale or more promotion of product of company.

2. Control on Quality

After getting ISO standards , company has to control on quality and it is the objective of ISO standards . ISO standard 9000 controls product's quality and ISO 14000 controls environment quality .

3. Revolution

After coming , ISO 9000 and ISO , 14000 companies have started to label the product by eco labeling . Moreover awarness has come in the minds of company after ist ISO standard in 1987.

Working of ISO

ISO 9000 is more powerful tool to get confidence in market . Company can invite customers to check the quality before purchasing the products. It will only possible after implement ISO 9000 standards . Every product's package is with ISO 9000 and customer can understand its value .

Version

1. ISO 9001 : 1987 2. ISO 9002 : 1987 3. ISO 9003: 1987 4. ISO 9000: 1987 , 1994 , 2000 5. ISO 9000 : 2008 6. ISO 9001 : 2008 ISO 14000 version

1. ISO 14000 family version 2. ISO 14001 : 2004 EMS 3. ISO 14020 ,14021 , 14022 , 14023 , 14024 , 14025 What is the NGO ? Discuss Its Type , Role And Legal Status ? Explain Various Methods in Which NGO Operates >> NOVEMBER 28, 2009 25 19 1052

Contents are covered under Business Environment of MBA Ist Semester Meaning of NGO

NGO means non - government organisation. Any organisation who is doing non profit activity is called NGO . The aim to make NGO is to do social activities . These organisations do not involve in commercial activities . The source of fund may be private or

govt. NGO collects fund through donation . Now , NGO are also known as private voluntary organisation . It is estimated that 40000 NGO are working internationally and more than 1 million NGO are only in India . Main objectives for making NGO are to reduce poverty , increase employment and support to poor children.

Student Welfare Council (NGO ) is sending Cheque for Children affected from Tsunami ( Members from left - Dr. Mathura Das Savtantra, Prof. Vinod Kumar, Krishan Kumar and many more.....) Types of NGO On the basis of Acronyms INGO INGO means international non govt. organisation . For example UNO and ILO are INGO. BINGO

BINGO means business oriented international NGO . CARE , RED Cross and Green peace are BINGO ENGO ENGO means environmental NGO GONGO GONGO means govt. operated NGO . QUANGO QUANGO means quasi autonomous NGO For example ISO TANGO TANGO means Technical assistance NGO CSO CSO means civil society organisation. Types of NGO on the basis of World bank's classification 1. Operational Operational NGO is that type of NGO which are created for development projects . 2. Advocacy Advocacy NGO is that type of NGO which are created for awareness projects .

3. USAID USAID is created as private voluntary organisation in US . Legal Status NGO has legal status under following laws 1. Any charitable society registered under society registration act 1860 2. Trust 3. Any ltd company formed under company law 1956 of India Methods in which NGO operates

There are following methods to operate NGO

1. Lobbying 2. Other Social welfare projects like project for providing food , drinking water , and poverty alleviation. Role of NGO in Consumer awarness

NGO plays a very important role in the consumer awareness . Consumer is the person who buys the products of the company. It is his right to choose the right product at right price . Many NGO are created for providing awareness to consumer with the help of print media , seminars and work shops with this consumers knows what are the points with a business man to cheat the consumers . He can give low quality products. These NGO are also helpful to give remedies to helpless consumers . Large nos. of advocates and legal experts work voluntarily in NGO . So , consumer can get help or advice from these members .