Meaning of Trade
This is the buying and selling of goods and services with the aim of making a profit.
Importance of trade:
Trade plays a vital role in any economy. The various roles played by trade in the economy include;
Classification of Trade
Trade can be classified on the basis of geographical location of the portion involved, these are;
1. Home trade
Also called internal, local or domestic trade. It refers to the buying and selling of goods and services within the boundaries of a given country.
It is further divided into retail trade and wholesale trade.
2. International trade (foreign trade)
This is trade that is carried out beyond the boundaries of a country
This is trade carried out between individuals or government of different countries e.g. trade between a citizen of Kenya and a citizen of Tanzania, or trade between the government of Kenya and the government of Southern Sudan
International trade carried out between two countries is referred to as bilateral trade and international trade carried out among many countries (more than two countries) is referred to as multilateral trade.
International trade is classified into the following;
Forms of Home Trade