Purchase and Sale – Long Answer Questions
Medium Level (Application & Explanation)
Q1. Explain the meaning of purchase and sale. How are they different? Give a simple example.
Answer:
- A purchase is when a person gets ownership of goods or property by paying money.
- A sale is when a seller transfers ownership of goods or property to a buyer for a price.
- In a purchase, the focus is on the buyer receiving the goods.
- In a sale, the focus is on the seller giving up rights over the goods.
- Example: You pay ₹500 for a book. You purchase the book. The shopkeeper sells the book and gives up ownership.
- Thus, both happen in the same act, but from different viewpoints.
Q2. Why do sale and purchase always go together? Explain the roles of buyer and seller.
Answer:
- Every sale has a seller who gives up ownership for a price.
- Every purchase has a buyer who pays money and gets ownership.
- The buyer gives money, and the seller gives the goods or service.
- So, the two actions happen at the same time, in the same exchange.
- Without a buyer, a sale cannot occur; without a seller, a purchase cannot happen.
- Hence, sale and purchase are two sides of the same transaction.
Q3. Why is the sale of goods necessary for the survival and growth of a business?
Answer:
- Businesses produce goods and services for others’ use.
- They earn money only when these goods and services are sold.
- The money earned must be more than the money spent on production.
- This extra amount is called profit.
- Profit is the reward for risk-taking and the return on capital invested.
- So, without regular sales, a business cannot exist or grow.
Q4. What should a buyer consider before making a purchase? Explain with reasons.
Answer:
- First, identify your needs. Do you really need it now?
- Check the attributes of the product or service. See quality, features, and usefulness.
- Consider price affordability. Buy only what fits your budget.
- Think about social and cultural aspects. Does it suit your values and surroundings?
- Compare alternatives to get better value.
- Make a careful decision to avoid waste of money and regret.
Q5. Explain how selling is different from marketing. Why is marketing broader?
Answer:
- Selling focuses on the act of transferring goods to the buyer for a price.
- Marketing is a wider process that starts before production.
- It finds people’s needs, designs the product, and seeks customer satisfaction.
- It ensures availability, affordability, and awareness before and after sale.
- Selling is a part of marketing, not the whole.
- Thus, marketing builds long-term value, while selling completes the transaction.
High Complexity (Analysis & Scenario-Based)
Q6. A shopkeeper plans to offer credit sales in a competitive market. What precautions should they take and why?
Answer:
- First, check the buyer’s credibility and paying capacity.
- Ask for basic references or past payment history.
- Set clear credit terms like 15 or 30 days and write them down.
- Fix credit limits to control risk for new buyers.
- Offer small credit first, then increase after timely payments.
- This balances more sales with lower risk of non-payment.
Q7. A company wants to launch a new product. Explain the marketing steps it should take before and after production.
Answer:
- First, identify people’s needs through simple surveys or feedback.
- Then design the product according to those needs.
- Keep price at a level most customers can afford.
- Ensure easy availability at places where buyers shop.
- Create awareness about the product’s benefits, before and after sale.
- Keep improving the product to maintain customer satisfaction.
Q8. You have a limited budget and must choose between two phones. How will you decide using buyer considerations?
Answer:
- Start with your needs: calls, studies, camera, or apps.
- Compare attributes: battery, storage, speed, and durability.
- Check price affordability. See total cost and warranty.
- Think about social and cultural aspects: looks, brand trust, and usage style.
- Weigh the value you get for the price you pay.
- Choose the one that best fits your needs and budget, not just the brand.
Q9. A business sees low sales even after production. Diagnose the problem using marketing functions and suggest fixes.
Answer:
- Maybe the product does not match customer needs. Recheck the requirements.
- Perhaps the price is too high. Adjust for better affordability.
- It could be a distribution issue. Improve availability in key locations.
- There may be low awareness. Increase simple promotion and demos.
- Work on after-sale support to build trust.
- Keep improving based on feedback to raise satisfaction and sales.
Q10. Compare cash and credit sales for a small business. Which would you choose and why?
Answer:
- Cash sales give instant money and reduce risk.
- Credit sales can increase customers and volume in a competitive market.
- But credit needs checks on credibility and paying capacity.
- Cash keeps cash flow strong, while credit may cause delays.
- A balanced approach works: mostly cash, selective credit with clear terms.
- This gives growth with safety and steady profit.