1. What is the Business environment?

Business Environment may be defined as the set of external factors such as

the economic factors, socio-cultural factors, government and legal,
demographic factors, geophysical factors, which are uncontrollable in nature
and affects the business decisions of a firm or company.

2. Write any 4 characteristics of business environment?

Profit Motive
Risk and Uncertainty
Creation of Utility
Organization
Financing
Consumer satisfaction

3. What is business activity?

4. What are the human objectives of business?

Welfare of employees
Satisfaction of Consumers
Satisfaction of share holders
Helpful to Government

5. Write any 8 features of 21 century business?

Destabilization of Protected Environment
Diversification
Brand Building
Selling and Distribution
Capital Structures
Buyers Market
Production Capacity
Technology

6. What is macro environment?

Macro environment is the indirect action environment as it may not have an
immediate direct effect on the operations but nevertheless have influence.”

7. Show the micro business with a chart?

8. What do you mean by desire competition?

9. How business depends up on natural environment?

Dependence of business on Natural environment:
Mfg depends on physical units.
Mining and drilling depend on deposits.
Agriculture depends on nature.
Trade depends on geographical factors.
T and C on geo factors.
Industrial estates depend on geo factors.
Topographical factors determine the demand pattern.

10.Give the meaning of environment scanning?

Scanning means to look carefully into or to examine. The term Environmental
Scanning means “Carefully analyze the various factors influencing the
business.”

11.Give 8 sources of information of?

12.What are the 3 stages of environment appraisal?

There are three stages and they are as under:
A) To be aware of the factors that affect environmental appraisal.
B) To identify the environmental factors.
C) To structure the results of environmental appraisal

13.Explain the swot analysis?

SWOT is undertaken by the business firms to understand the internal and
external Envt. Through such analysis the strengths and weaknesses existing
 in the org can be matched with the opp and threats operating in the Envt so
that an effective strategy can be formulated.
Internal Envt: Finance, Tech and skill, Prod facilities, Personnel capabilities,
marketing capabilities.
External envt

14.What do you mean by policy?

15.Why macroeconomic policy is important?

16.Writer any 4?

17.What is monitory policy?

Monetary policy is concerned with the changes in supply of money and credit.
It refers to the policy measures undertaken by the government or the central
bank to influence the availability, cost and use of money and credit with the
help of monetary techniques to achieve specific objectives.
Or
According to A J Shapiro “Monetary policy is the exercise of the central
bank’s control over the money supply as an instrument for achieving the
objectives of economic policy.”

18.What is fiscal policy?

Harvey and Johnson:
“ Changes in govt exp and taxation designed to influence the pattern and
level of activity”.
 Public finance can not remain neutral

19.What is budget?

1. Explain the economic objective of business?

• Profit earning
• Production of goods
• Creating markets
• Technological improvements

2. Show macro environment and micro environment with the help of HR?
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3. Explain the Macro environment?
According to Hill and Jones, “the Macro environment consists of the
broader economic, social demographic, legal and technological setting within
which the industry and the company are placed.”

The important macro environment factors are explained as follows:

a. Economic environment: The present day economic environment of business

is a complex one. The business sector has economic relations with the
government, capital market, household sector and global sector.
b. Political and Government environment: Legislature, Executive and Judiciary.
c. Socio cultural environment: The organization works within this environment.
Socio cultural factors include people’s attitude to work and health, role of
family, marriage, religion and education, ethical issues, social responsibility
of business.
d. Natural environment: This includes geographical and ecological factors. They
include:
• Natural resources endowments
• Weather and climate conditions
• Topographical factors
• Locations aspects
• Port facilities.

1. Explain the economic policy with effect the business?

• Industrial policy
• Foreign investment and technology policy
• Monetary policy
• Fiscal policy

1. Write a note a natural environment?

• Manufacturing depends on physical units
 • Mining and drilling depend on deposits
• Agriculture depends on nature
• Trade depends on geographical factors
• Topographical factors determine the demand pattern.
• Industrial estates depends on geographical factors
• T and C on geographical factors.

1. Discuss the term international environment?

• Due to liberalization, Indian companies are forced to view business
issues from the global perspectives.
• Safe and protected markets are no longer there. World is becoming
small in size due to advanced means of transport and communication.
• Learning of foreign languages is a must for every business manager.
• Acquiring familiarity with foreign currencies is also a must.
• Facing political and legal uncertainties is inevitable.
• To survive amidst intense competition every businessman should try to
adopt his products to different customer needs and tastes.
• Mobilization of resources, particularly financial is an essential starting
point in the process of international environment.

1. What are the reasons with necessary environmental scanning?

• Effective utilization of resources
• Constant monitoring of the environment
• Strategy formulation
• Identification of threats and opportunities
• Useful for the manages
• Predication of future

1. What are the 4 factor which are essential environment scanning? Explain with
the help of diagram?

• Events
• Expectations of people
• Issues
• Trends
 EXPECTATIONS
ISSUES OF
TRENDS
EXTERNAL
EVENTS ENVIRONMENT OF
PEOPLE BUSINESS

1. Explain ETOP technique?

This is suggested by Glueck.

The preparation of it involves the following steps:

• It involves dividing the environment into different sectors.

 • Analyzing the impact of each sector on the organization.
• Subdividing each environmental factor into sub factors for a
comprehensive ETOP.
• Analyzing the impact of each sub factor on the organization in the form of
a statement.
• Preparing a summary to show the major factors for the sake of simplicity.

1. Explain the feature of industrial policy resolution 1948?

• The first category was to be the exclusive monopoly of the state
• It emphasized on role of small scale and cottage industries
• It game importance to the relationship between labour and the
management of various industries.
• Role of foreign capital
• Implementation sound tariff policy

1. Explain the objective of monetary policy?

• Neutrality of money
• Exchange stability
• Price stability
• Full employment
• Economic growth

1. Write a brief note on fiscal policy?

According to Harvey and Johnson “Changes in government expenses and

taxation designed to influence the pattern and level of activity.”

• It is purposeful manipulation of public expenses, taxes and other sources of

revenue.
• It is used both in developed and underdeveloped countries.
• It concerns itself with the flow of funds in the economy.
• Taxation-funds from private sector to government sector.
• Expenditure-diverts funds from governments sector to economy.
• It influence the working of the national economy.

Objectives of Fiscal Policy:

• Optimum allocation of economic resources.

• Maintain price stability.
• Maintenance of full employment.
• Capital formation.
• Economic stability.
1. Write a brief EXIM policy 20002-2007?

The Government of India announced the new five year export import
policy covering the Tenth Five Year Plan Period (2002-07) on March 31, 2002.
The main initiatives announced in the Exim Policy (2002-07) were as follows:

• Exim Policy 2001-02 had removed quantitative restrictions on all

imports.
• The government decided to focus on the export of 106 items identified
in the medium term export strategy released in January 2002.
• Many measures were announced to give major thrust to agri exports.
• Units set up in SEZ’s (Special Economic Zones) were granted a number
of concessions and exemption.
• The Exim Policy (2002-07) places a special focus on the small scale
sector which generates almost 50 per cent of India’s exports.
• The status holders export houses, trading houses and star trading
houses were granted special benefits.
• The Exim Policy (2002-07) shifted as many as 50 items to the OGL
(Open General Licence or free list).
• Changes were made in the Export Promotion Capital Goods (EPCG)
scheme to help exporters.

1. Bring out different between direct and indirect taxation?