CMA Foundation · Fundamentals of Business Economics and Management · Economic and Business Environment
Which feature best describes the business environment as a concept?
The business environment is dynamic and uncertain, and it presents both opportunities and threats to the firm. It covers many forces, not only economic ones, and most of them lie beyond the firm's control, so managers must keep monitoring and adapting to change.
- AIt is static and remains unchanged over long periods
- BIt is dynamic, uncertain and has both opportunities and threats for the firmCorrect
- CIt consists only of factors that the firm can fully control
- DIt includes only economic factors such as inflation and interest rates
Explanation
Business environment is the sum of all internal and external forces that affect a firm. It keeps changing, is uncertain, and creates both opportunities and threats. It is not static, not fully controllable, and not limited to economic factors.
Did you get it right without looking?
One question tells you little. A timed set on Economic and Business Environment shows your real accuracy, how long you take and where you lose marks.
More Economic and Business Environment questions
- The Government of India sells part of its equity holding in a public sector company to private investors but retains majority ownership. Thi…
- Under Section 135 of the Companies Act, 2013, a company meeting the prescribed net worth, turnover or net profit threshold must spend on CSR…
- The Reserve Bank of India raises the repo rate. Other things remaining equal, what is the most likely immediate effect on a business that de…
- The sustainability idea of the 'triple bottom line' evaluates a business performance on which three dimensions?
- Which of the following is an element of the INTERNAL environment of a business rather than its external environment?
- The 'triple bottom line' approach to measuring business performance evaluates a firm on which three dimensions?