Business Environment — Flashcards

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Business Environment refers to all external forces, factors, and institutions that are beyond the control of a business but significantly influence its operations. These include customers, competitors…

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The key features of Business Environment are: 1. **Sum total of all factors** – It includes all external elements affecting business. 2. **Micro and Macro factors** – Micro include customers, supplier…

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The business environment is dynamic because it keeps changing due to shifts in technology, consumer preferences, government policies, and global trends. For instance, the rise of smartphones changed h…

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**Micro Environment** includes factors that directly affect a business, such as customers, suppliers, competitors, and investors. Example: A sudden increase in raw material prices from a supplier affe…

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The components of Economic Environment are: 1. **Economic Conditions** – GDP, per capita income, capital availability. 2. **Economic Policies** – Industrial, fiscal, monetary, foreign investment, and …

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Understanding the business environment helps firms in: 1. Identifying opportunities and threats. 2. Planning for growth (e.g., Reliance Jio entering telecom). 3. Continuous learning and adaptation. 4.

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Liberalisation means removing unnecessary government controls and restrictions on business. Examples: 1. Abolishing industrial licensing for most industries. 2. Reducing tax rates and simplifying impo…

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Privatisation refers to reducing the role of the public sector by involving the private sector in business activities. Significance: - Encourages efficiency and competition. - Helps raise government r…