 The legal environment plays a very

important role. The laws of the country,

the judicial system, and the laws which
effect business are important.
 The political/legal environment includes
:
Local Issues : Global Issues:
- Regulatory - Trade
Agreement
- Taxes - Political Issues
 Economics environment consists some
of economics interactions element –
demand dynamics, supply
situation, pricing factors, degree
of competitiveness, and impact of
profitability.
The economics environment includes:
-Microeconomics
-Macroeconomics
 A branch of economics that studies how
individuals, household, and firms makes
decisions to allocate limited resources,
typically in markets where goods or
services are being bought and sold

 Microeconomics examines how these

decisions and behaviour affect supply and
demand for goods and services, which
determine the supply and demand of
goods and services.
 Isa branch of economics that deals
with the performance, structure, and
behaviour of a national or regional
economy as a whole.
 Macroeconomists develop models that
explain the relationship between :

Y = C + I + G + (X -
M)
Y = national income
C = public consumption
I = private investment
G = government expenditure
X = export
M = import
 Relatingto both social and cultural
matters. The sociocultural environment
includes ;
Demographic Trends :
Describe the changes in demographic
in a population over time such as :
- Race - Educational Background
- Age - Home ownership
- Income - Employment
- Disabilities - Location
- Mobility
 Movement of an individual or group
one class or social status to another.

 Usually, the points of reference is an

individual’s class or status of social
origin and social mobility occurs when
later class or status position differ from
those of origin
 Technology is a consequences of
science and engineering. Technology is
a term with origins in the Greek
“technologia” and “logia”. However, a
strict definition is elusive; “technology”
can refer to material objects of use to
humanity, such as machines, hardware
or utensils, but can also encompass
broader themes, includings systems,
methods or organization, and
techniques .
The technological environment includes;
 Innovation – the introduction of
something new
 Imitation – individual observes and
replicates another’s.