Compare business with profession and employment.
Economic activities are broadly classified into three major categories: Business, Profession, and Employment. Each of these differs significantly on various parameters.
Regarding the mode of establishment, a business is established through an entrepreneur's decision and necessary legal formalities. A profession requires membership of a professional body and a certificate of practice. Employment, on the other hand, is secured through an appointment letter and service agreement.
The nature of work also differs. Business involves the provision of goods and services to the public. Profession entails rendering of personalised, expert services. Employment involves performing work as per the service contract or rules of service.
In terms of qualification, business does not require any minimum qualification. Profession demands specific qualifications, expertise, and training as prescribed by the professional body. Employment requires qualification and training as prescribed by the employer.
The reward or return varies across these activities. Business earns profit, profession earns a professional fee, and employment earns salary or wages. Additionally, capital investment is required in business as per its size and nature, while profession needs limited capital, and employment requires no capital. Business also involves an element of risk due to uncertainty, which is not a prominent feature in profession or employment.
Explanation
The answer draws directly from the comparison table provided in the textbook context (Figure 1.2). It covers all five basis of comparison: Mode of establishment, Nature of work, Qualification, Reward or return, and Capital investment. Additionally, it mentions the element of risk which is specifically associated with business as stated in the context. The answer is structured in 5 paragraphs with key terms bolded, meeting the 150-200 word requirement for a 5-mark long answer.