Q.Explain any two business activities which are auxiliaries to trade.

Trade faces hindrances such as the distance between producers and consumers or the need for funds, and auxiliaries to trade are the support services that remove these obstacles. …

Auxiliaries to trade are the services that facilitate trade and help remove the hindrances in the exchange of goods. Two important ones:

Transport (and Communication)

• Goods are produced in particular locations (tea in Assam, cotton in Gujarat/Maharashtra, jute in West Bengal/Odisha, sugar in U.P./Bihar/Maharashtra) but are consumed all over the country.
• Transport by road, rail or coastal shipping removes this obstacle of place — carrying raw materials to the place of production and finished goods to the place of consumption.
• Alongside it, communication (postal services, telephones) lets producers, traders and consumers exchange information, so it too is an auxiliary to business.

Banking and Finance

• Business needs funds to acquire assets, buy raw materials and meet expenses; banks supply these funds, solving the problem of finance. …