Trade
From Wikipedia, a free encyclopedia written in simple English for easy reading.
To trade is to willingly give things or services and get other things or services in return. For example, a person giving a thing must find another person who wants to get that thing. The giver gets something back in return.
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[edit] Example
- At the beginning, Bob has a hat. Jane wants the hat.
- At the start, Jane has an apple. Bob wants the apple.
- Bob gives Jane the hat and Jane gives Bob the apple. This is called a trade.
- At the end, Bob has the apple.
- After the trade, Jane has the hat.
- Bob and Jane have what they want.
[edit] Other Words
A trade is also called an exchange or a swap.
[edit] Trades with Goods, Services and Money
The things that are given from one person to the other are called goods.
Services can also be part of a trade. One person can do a job or work for another, and get something in return in a trade.
Money can be given in return for a service or for a thing. If money is part of the trade, then the person who gives the money is buying, and the person who gets the money is selling.
[edit] More Words
A place where trading takes place is called a market.
When there is no money involved in the trade, the trade is called barter. If there is money involved in the trade, the trade is called a purchase. In the past people would barter to get what they wanted, instead of buying goods and services.
The study of trade is called "economics".
[edit] Countries and Trade
Now trade is not just between people, but also between large companies or even countries. Countries sometimes take some of the money or goods involved in a trade between countries. This is a type of tax called a taarrif. Smugglers try to trade without paying tarrifs.
A free trade between two countries has no tariff on the trade.
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