CMA Foundation · Fundamentals of Business Economics and Management · Economic and Business Environment
A manager says, 'Business environment is dynamic, so our strategy must be reviewed regularly.' Which feature of the business environment does this statement highlight?
The statement highlights that the business environment is uncertain and constantly changing. Because technology, regulations, tastes and competition keep shifting, firms must monitor these changes and revise their strategies regularly, rather than assuming conditions remain static or fully controllable.
- AIt is static and unchanging
- BIt is uncertain and constantly changingCorrect
- CIt is entirely controllable by the firm
- DIt is limited to economic factors only
Explanation
Business environment changes continuously because of shifts in technology, policy, tastes and competition, making it uncertain. This is why strategies need periodic review. It is not controllable by the firm and is not limited to economic factors.
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