Question

Advances in information technology have drastically affected input procurement practices. The internet makes many goods and services a mere "click" away. As a result, transaction costs are changing as well.

Identify and discuss business or industry that has altered the way it utilizes spot exchange, contracts and integration.

Answer 1

With the current digital age evolving the exchange world drastically. The consumer base is more than ever , spread across the world and the goods producers are almost competing in a perfect competition like market which has started to convert to a monopoly , because of capitalistic and accumulation of wealth culture. Earlier the business was limited to a local section or at most across the country. To expand it , migration was made as surplus was being accumulated , and trade came into existence. Imagine being at a time where consumers were made aware of new goods and services , door to door and now , just a click away. The digital revolution changed everything.

Talking about changing transection cost , in the initial stage of digital revolution , people were made aware of goods via televisions or radio and then consumer made efforts to go in market and find the good which they presume are good for their needs. Currently both the steps of providing information to consumer and buying options are just a click away. Transection cost has reduced considerably and choices of goods available is infinite. Spot exchange rate is working on daily basis for goods as the connectivity is so fast and accurate that alterations can be monitored easily. Contracts and integration between firms or producer consumer are available digital and can be altered according to needs with just a click or real time interface.