Skip to content

IAI Actuarial Core Principles · Business Management · Strategy, competitive advantage, strategic decision process and PEST analysis

An Indian life insurer is preparing a PEST analysis before launching a new retirement product. Which of the following is correctly classified under the 'Social' factor?

The rise in the share of people over 60 and changing attitudes to family support is a Social factor, because PEST's social element covers demographics and cultural attitudes. Tax rules are political, repo rate and GDP are economic, and app usage is technological.

  1. AA rise in the share of the population aged above 60 and changing attitudes to family support in old ageCorrect
  2. BA revision of income tax rules on annuity income
  3. CA fall in the repo rate set by the Reserve Bank of India
  4. DWider use of smartphone-based apps for premium payment
  5. A change in the GDP growth forecast for the coming year

Explanation

Social factors cover demographics, lifestyle and attitudes. An ageing population and changing views on family support in old age directly shape demand for retirement products. Tax rules are political/legal, the repo rate and GDP growth are economic, and smartphone apps are technological.

Did you get it right without looking?

One question tells you little. A timed set on Strategy, competitive advantage, strategic decision process and PEST analysis shows your real accuracy, how long you take and where you lose marks.

Practise Strategy, competitive advantage, strategic decision process and PEST analysisFree diagnostic mock

More Strategy, competitive advantage, strategic decision process and PEST analysis questions