Theory question 109
Business Environment and Social ResponsibilityCommerce 2 (answer five questions)
Mention and explain any four environments under which a business operates.
Show the model answer
Model answer
Any four, explained: economic environment – incomes, inflation, interest and exchange rates, demand; political/legal environment – government stability, policies, laws and regulations, taxes; social/cultural environment – customs, religion, tastes, education, attitudes of the people; technological environment – level of technology, machines, innovation; physical/natural environment – climate, land, natural resources; demographic environment – size, age and distribution of population; competitive environment – rival firms.
Explanation
Mention each environment and say how it affects the business.