Trade
From the Simple English Wikipedia, the free encyclopedia that anyone can change
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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[change] 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.
[change] Other Words
A trade is also called an exchange or a swap.
[change] 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.
[change] 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".
[change] 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 tariff. Smugglers try to trade without paying tarrifs.
A free trade between two countries has no tariff on the trade.
