Trade is simply a practice of the exchange of goods from one entity to another. This is often in exchange for money. Foreign trade includes transfer of goods from one nation to another. An example of trade is when you work in sales, you trade your talents to the organization in return to a salary. Or when a Granite factory trade its products for money with a furniture manufacturer.
Trade can be categorized into following two types:
- Internal or Domestic trade.
- External or International trade.
This process is very advantageous for an economy because there an individuals focus on doing the things they do best and then exchange the products of their labor with others who are similarly producing something of his excellence. This leads to much higher levels of quality and quantity of production of goods and services.
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