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CBSE Questions for Class 12 Commerce Business Studies Business Environment Quiz 10 - MCQExams.com
CBSE
Class 12 Commerce Business Studies
Business Environment
Quiz 10
Which of the following is not a part of Environmental factor?
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Emphasis on safety
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Energy available and costs,
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Waste disposal,
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Environmental legislation
Explanation
Emphasis on safety is not a part of Environmental factor since it is not related directly to the environment. Emphasis on safety falls under the social factor since it includes values and practices.
When we analyse the processes of change in the business environment, it, conceptualizing it as_________.
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Complex
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Static
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Dynamic
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Diverse
Explanation
When we analyse the processes of change in the business environment it conceptualizing it as: Dynamic. Business environment keeps on changing weather in terms of technological improvement, shifts in consumer preferences or entry of new competition in the market.
Environment scanning involves
_________________.
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Monitoring Govt. regulations
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Monitoring Competitors
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Monitoring supplier & client
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Monitoring internal & external environment.
Explanation
Environment scanning involves monitoring of monitoring internal and external environment.
The careful monitoring of an organization's internal and external environments for detecting early signs of opportunities and threats that may influence its current and future plans means environment scanning.
Buyers cannot exercise high bargaining power over their suppliers if ___________.
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The volume they buy accounts for a large percentage of their supplier's sales
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There are few buyers in the market
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They have many suppliers to choose from
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There is a high concentration of suppliers
Explanation
Buyers cannot exercise high bargaining power over their suppliers if there is a high concentration of suppliers. Bargaining power of the buyer refers to the relative power of the buyer which he uses to influence sellers. In this situation, buyer have very less relative power to exercise on sellers.
Which of the following is not a type of Environmental Scanning?
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Passive Scanning
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Active Scanning
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Directed Scanning
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Indirect Scanning
Explanation
Indirect scanning is not a type of Environmental Scanning.
Environment Scanning is careful monitoring of an organization's internal and external environments for detecting early signs of opportunities and threats that may influence its current and future plans. It helps to improve the business organization's condition in the market. It helps to analyse threats and grab the opportunities at the earliest.
Out of the following, the main sets of forces mostly affecting organizations are_____________________.
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External stakeholders, management and staff.
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Existing and potential competitors, suppliers, customers and substitute products or service.
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General environmental factors, competitive forces, factors internal to the organisation and the interests of stakeholders
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Government, competitors and consumers
Explanation
The main sets of forces mostly affecting organizations are :-
General environmental factors, competitive forces, factors internal to the organization and the interests of stakeholders.
These forces affect the business organization and the decisions taken by the organization greatly. Hence, one should consider all the forces while making the business' strategic plan to grab the opportunity and identify threats at the earliest.
Industry analysis should include information on ________.
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Market size of competitor's product
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Growth rate of suppliers
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New product entry
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Economic conditions
Explanation
Industry analysis should include information on economic conditions. All the activities of the industry gets directly or indirectly by the condition of the economy. Thus the analysis of the industrial activities is based on the economy related information.
Which of the following is not a political factor that impacts external macro-environment?
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Population growth rate,
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Tax policy,
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Government type and stability
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Regulation and de-regulation trends
Explanation
Population growth rate is not a political factor that impacts external macro-environment. It is a demographic feature. Population growth rate specifies the rate at which the population is increasing or decreasing.
Which of the following is not one of the Porter's five force factor?
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New Entrant
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Supplier power
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Competitor
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Political factor
Explanation
Political factor is not one of the Porter's five force factor.
The Porter's five forces tool is a simple but powerful tool to evaluate the power of business.
Porter's Forces Analysis assumes that there are important forces that determine competitive power in a business situation. These are:
a) Supplier power,
b) Buyer power,
c) Competitive rivalry,
d) Threat of substitution,
e) Threat of new entry
As per Porter's Forces Analysis, supplier power assesses how easily suppliers may drive up prices.
As per Porter's Forces Analysis, buyer power evaluates how easy it is for buyers to drive prices down.
The insecurity due to tomorrow's products that haven't even been invented yet, reflects which aspect of the technological environment?
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Concentration on minor improvements.
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Increased regulation.
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High R&D budgets.
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The fast pace of technological change
Explanation
b'
The insecurity due to tomorrow\'s products that haven\'t even been invented yet, reflects the fast pace of technological change. Nowadays, advancement of technology is happening at a very rapid pace. Hence proper business environment scanning is of utmost importance for the organization as business environment is highly dynamic in nature.
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What is the most appropriate Externally imposed strategy is?
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Imposition of strategy by individual shareholder.
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Imposition of strategy by managers
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Reacting to threats and opportunities in the environment
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The imposition of strategy by Government in companies where it has extensive regulation.
Explanation
The imposition of strategy by Government in companies where it has extensive regulation is the most appropriate externally imposed strategy. It is an externally imposed strategy since government is an external agent, but it does affect the activities of the business organizations indirectly.
Out of the following, which would you NOT classify as a political-legal factor in the external environment?
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European Union directive on working hours.
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Government policy on corporate and personal income taxes
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Regulatory requirements for the telecommunications industry.
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Consumer attitudes to greater competition in the gas and electricity industries
Explanation
Consumer attitudes to greater competition in the gas and electricity industries is not classified as a political-legal factor in the external environment.
Political environment refers to legislature. The political environment of a country gets influenced by the political organizations such as philosophy of political parties, ideology of government or party in power, nature and extent of bureaucracy influence of primary groups.
Internal factors of business environment include ______________.
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Vision of the organization
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Mission of the organization
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Vision and Mission of the organization.
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Vision and Mission of the organization and other internal mechanism of the organization
Explanation
Internal factors of business environment include vision and mission of the organization and other internal mechanism of the organization. The internal factors have received considerable attention by firms. A business has control on the internal factors of the business organization.
Liberalization does NOT include__________________.
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Reduction in taxes
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Simplifying exports
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Reducing administrative burden on state.
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Abolishing industrial licensing requirement for most of the industries.
Explanation
Liberalization does NOT include reducing administrative burden on state. It is a process by which free and fair trade is promoted. It includes reduction in taxes, simplification of exports and abolishing industrial licensing requirement for most of the industries.
Analysing process of change in the business environment involves conceptualizing it as.
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Complex
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Static
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Dynamic
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Diverse
Explanation
Analysing the process of change in the business environment involves conceptualizing it as dynamic. Business environment keeps on changing weather in terms of technological improvement, shifts in consumer preferences or entry of new competition in the market.
All of the following are the broad categories of External forces EXCEPT _____.
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economic forces
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socioeconomic forces
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technological forces
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none of the above
Explanation
All the following are the broad categories of external forces.
External forces are those factor which are not with in the control of management/organization.
Which of the following is a characteristic of a business environment?
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Aggregative
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Dynamic
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Uncertain
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All of them.
Explanation
Option d is the correct answer.
1. It is an aggregative of all factors of environment of business.
2. The environment keeps on changing, it is dynamic in nature.
3. The business environment is full of uncertainty and risk.
Hence, of these are the characteristics of business environment.
The type of business environment within a company is called __________ environment ___________.
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culture
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employers
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customers
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internal
Explanation
The type of business environment within a company is called internal environment. Internal environment contains the owners of the business, the shareholders, the managing director, the non-managers, employees, the customer, structure of the business organization and the culture of the organization.
The acronym STEEP means ____________.
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Social, Technological, Economical, Environmental, and Political
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Suppliers, Technology conditions, Ecology and physical environment, Political and legal
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Employees & Political legal
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None of these
Explanation
STEEP is basically an acronym which stands for Social, Technological, Economical, Environmental, and Political.
A STEEP analysis is a tool commonly used in marketing
to evaluate different external factors which impact an organization. It is essential for every business to consider some external forces before they can take decisions.
The social developments include factors like consumer behavior demographics, religion, lifestyles, values, and advertising.
The technology aspect of STEEP analysis focuses highly on technological advancements.
The economic condition is strongly associated with the consumers’ buying position.
Environmental developments involve ecosystem factors such as water, wind, food, soil, energy, pollution and environmental regulations.
The Political developments can highly influence individuals and organizations.
Choose the correct alternative.
(i)Demographic trends are a part of _______.
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Economic environment III
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Social environment
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Political environment
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Legal environment
Explanation
The social environment refers to the environment which is surrounded by a social setting in which the people act upon. Demographic trends are a part of social environment.
Demographics refer to the size, density,
distribution and growth rate of population.
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Understanding of environment enables a business enterprise to _______.
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Focus on customers
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Gain the first mover advantage
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Become aware of impending threat
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All of them.
Explanation
Option D
A business environment enables firms to analyse their competitors' strategies and actions. Further, they can create their own strategies accordingly,
Understanding of Environment enables a business enterprise to
Focus on customer, helps to understand what consumer needs are and gain the first mover advantage and help to become aware of the impending threat.
A society's basic values, lifestyle, culture, preferences are all part of its ____________ Environment.
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Cultural-economic
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Physical environment
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Natural
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Socio cultural
Explanation
A society's basic values, lifestyle, culture, preferences are all part of its socio-cultural Environment. These factors directly or indirectly leave the impact on the business environment. Societal values and lifestyles are dynamic in nature- these changes over time.
Merger of associate banks of SBI into SBI is an example of changes in ________.
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Economic environment
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Technological environment
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Social environment
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Demographic environment
Explanation
Merger of associate banks of SBI into SBI is an example of changes in economic environment. Since the merger of associate banks proved to be beneficial on economic terms. It will help to increase the real GDP.
Demonetization and GST are examples of changes in ________.
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Political environment
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Social environment
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Technological environment
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Global environment
Explanation
Demonetization and GST are examples of changes in political environment. Political environment of a country gets influenced by the political organizations. Demonetization and GST are classified under political environment since these reforms are taken by the government of India.
Which of the following relates to population?
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Demographic environment
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Social environment
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Cultural environment
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Natural environment
Explanation
Demographic environment relates to population. Demographics refer to the size, density, distribution and growth rate of population.
Demographics is a part of the macro environment of the business organization. It is one of the key factors of the business environment.
What is meant by the phrase CSR?
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Corporate Social Responsibility
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Company Social Responsibility
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Corporate Society Responsibility
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Company Society Responsibility
Explanation
Corporate Social Responsibility is a part of business where the responsibility of a corporate unit is defined in terms of their existence in the society because if the corporate unit is developed and run in the society using the society's resources then they have some responsibility for the society.
Effect of Globalisation will be felt significantly in respect of -
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Outwardly-oriented economies
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Internal-oriented economies
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Both (a) and (b)
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Neither (a) nor (b)
State whether the following statement is True or False:
Privatization and globalization are components of economic liberalization.
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True
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False
Explanation
A. True
There are three components of economic liberalization, viz. liberalization, privatization and globalization. Privatization refers to the increase in the dominating role of the private sector and decrease in the role of the government sector. The government companies can be converted into private company by way of disinvestment or by the withdrawal of government ownership and management in the public sector companies.
Globalization refers to the integration of the economy of one country with the global economy. Globalization focuses mainly on the foreign trade and private and institutional foreign investment.
State whether the following statement is True or False:
Innovative approach requires no feedback system.
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True
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False
Explanation
Innovative approach requires no feedback system- this statement is false. Innovative approach also requires feedback system since feedback is of utmost necessary to check whether the planning and strategy of the business gets implemented properly.
Age, family size, sex composition and other people related elements are part of _______.
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Political environment
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Economic environment
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Demographic environment
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Natural environment.
Explanation
A demographic environment is a set of demographic factors such as gender or ethnicity. Companies use demographic environments to identify target markets for specific products or services
examples of demographics are age, sex, education, nationality, ethnicity, or religion
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