Trade is the process of buying and selling of goods and services. In medieval years, trade was by barter. This means that people were exchanging goods for goods. People exchanged what they have for what others have and are ready to exchange. With the advent of money, we now exchange it for whatever we want. Trade by barter had many defaults that money and modern means of payment have corrected.
Trade is the backbone or foundation of commerce as it entails those transactions and activities that ultimately affect the transfer of ownership of goods and services.
Trade is divided into two main types:
- Home trade
- Foreign or international trade
We shall see the difference as we progress.