CMA Foundation · Fundamentals of Business Economics and Management · Economic and Business Environment
Which of the following is an element of the INTERNAL environment of a business rather than its external environment?
The company's mission and organisational culture form part of the internal environment. These are factors inside the firm and largely controllable by management, whereas competitors, government policy and consumer habits are external forces that the firm must adapt to rather than control.
- ACompetitors' pricing policy
- BCompany's mission and organisational cultureCorrect
- CGovernment licensing policy
- DConsumer buying habits in the region
Explanation
Internal environment comprises factors within the firm's control such as mission, values, culture, management structure and resources. Competitors, government policy and customers lie outside the firm and form the external environment.
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