Question : Case Study 1:
ABC Ltd. is a well-established manufacturing company that has been operating for several years. Recently, the company faced a decline in sales due to the economic recession in the country.
Q:- Which feature of the business environment is evident from the scenario?
Option 1: External and dynamic nature
Option 2: Specific and controllable
Option 3: Independent of business decisions
Option 4: Stable and unchanging
Correct Answer: External and dynamic nature
Solution : The correct answer is (A) External and dynamic nature
The scenario describes how the business (ABC Ltd.) faced a decline in sales due to the economic recession in the country. This situation illustrates that the business environment is external (outside the company) and dynamic (subject to change, such as economic conditions). It's influenced by factors beyond the company's control, and it can change over time, as evident from the economic recession impacting the company's sales.
Q:- What does the term "business environment" refer to?
Option 1: The internal factors affecting a business
Option 2: The external factors influencing business operations
Option 3: The core values and mission of a company
Option 4: The strategic decisions made by the management
Q :- Why is understanding the business environment important for ABC Ltd.?
Option 1: To ensure complete control over external factors
Option 2: To analyze the internal structure of the company
Option 3: To identify potential opportunities and threats in the market
Option 4: To determine the pricing strategy for existing products
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