You are on page 1of 5

Business Environment Testing 1 (Direct questions)


(2) (3) (4)

(5) (6)




What is the nature of business environment? Explain how business and environment are interdependent. Define Business Environment. Explain its features. Explain the importance of Business Environment. Explain the concept of Business Environment. Briefly explain the factors affecting business environment. Explain the various dimensions of Business Environment. Explain the impact of Government Policy Changes on Business and Industry. Write short notes on: (A) Liberalisation. (B) Need for Privatisation (C) Features of Globalisation. Distinguish between: (1) Liberalisation, privatisation and Globalisation. (2) Economic Environment and Social Environment. (3) Political Environment and Legal Environment. Write True or False with reasons: (1) Privatisation of the public sector requires some precautions to be taken by the Government. (2) Globalisation results in unequal competition. (3) Social Environment consists of factors related to the management of public affairs. (4) The external factors of business environment are controllable factors. (5) Liberalisation refers to a set of measures and reforms aimed at the creation of an open economy. (6) Globalisation is the expansion and extension of economic activities across political boundaries of a country. (7) Privatisation is the transformation of public sector into private sector either fully or partially.

Testing II

Q.1. (A) Select the proper option from the options given below and rewrite the sentences: Changes in the fiscal policy of the government are an aspect of _____ environment. (a) political (b) social (c) economic (2) Changes in the judicial system are an aspect of _______ environment. (a) Economic, (b) social, (c) legal (3) Privatisation implies reduction in the role of ______ sector. (a) Public (b) private (c) joint (4) Level of literacy is an aspect of ______ environment. (a) Economic (b) social (c) political (5) Business Environment has tremendous impact on ______ (a) Government (b) people (c) business (6) Changes in the ruling government are an aspect of ______ environment. (a) Economic (b) social (c) political (7) Environment awareness provides ________ signal. (a) red, (b) yellow (c) warning) (8) The new industrial policy was formulated in _______ (a) 1961 (b) 1981 (c) 1991 (9) Globalisation is concerned with ______ market. (a) regional (b) national (c) world (10) Disinvestment means selling of government equity in public sector to _____. (a) joint sector (b) private sector (c) foreign company (11) Changes in literacy level will have impact on ________ environment. (a) social (b) economic (c) political (12) The _______ crisis faced by India in 1990-91 forced the government to introduce reforms. (a) balance of payment (b) unemployment (c) industrial (13) __________ involves general surveillance of all environmental factors and their interaction. (a) scanning (b) monitoring (c) forecasting (d) assessment

Q.1. B. Match the following pairs: (a) (b) (c) Group A Privatisation Internal Environment Liberalisation (1) (2) (3) Group B Unlimited liability Supreme Court Judge Socialism

(d) (e) (f) (g) (h) (i) (j)

Political Environment Globalisation Legal Environment Social Environment Economic Environment Micro Environment Macro Environment

(4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15)

Management Values and demographic trends Disinvestment Delicensing National Geography National Economy Judicial system Integration of activities World Economy National income and its distribution Firms operational environment Firms general environment

Q.1. (C) Fill in the blanks and rewrite the sentences:


beyond the control of the businessman are the result of _____ environment. India has adopted the policy of liberalization, globalization and ________ (3) Since ______ India has been going through a process of economic reforms. (4) The new Industrial policy was formulated in ________. (5) Freedom to business enterprises from government controls implies ______. (6) Factors like customs, traditions etc. constitute a part of ______ Environment of business. (7) Interdependency and integration of individual countries of the world is called _______. (8) Business Environment consists of ______ and ______ factors. (9) Economic, political and social factors are the dimensions of business. (10) ________ refers to the socio-economic surroundings under which the business activities are to be conducted. (11) ______ of the business means the aggregate of all conditions, events and influences that surround and affect it. (12) The process of deregulation and delicensing of industry is called ______. (13) The entry of private sector into public sector is called _______. (14) Factors which fall under the control of businessmen are called _____ factors. (15) ______ and ________ are the two basic components of external environment.

(16) _______

and ________ are the two basic components of internal environment. (17) ______ is important to study business dynamics which depends on environmental dynamics. (18) ______ is the first step in the process of environmental analysis. Q.1. (D) Write the word or phrase or a term which can substitute each one of the following statements. Name of the analysis which is the systematic approach to understanding the environment. (2) Uncontrollable factors of the environment. (3) The environment of business includes customs and traditions, values, social trends. (4) The process of transferring ownership of a business enterprise, agency or public service from the public sector to private sector. (5) A boundryless world where these would be free flow of goods, services, information, capital and people across nations. (6) The environment which consists of the framework of laws, regulations and court decisions which guide control the business activities at National, State and Local level. (7) The environment in which institutions like legislature, executive and judiciary influence business activities. (8) The process of relation of previous Government restrictions in the areas of social or economic policy. (9) The environment in which all forces have direct impact on business in areas of agriculture planning, infrastructure, price level, trade cycle, states of development and interest rates etc. (10) Controllable factors of the Environment. (11) Name two controllable factors of the Environment. (12) Name two uncontrollable factors of the Environment. (13) An environment which consists of all these factors which are in the firms immediate environment. (14) An environment which consists of all these societal factors which affect the working of a firm. (15) Scanning, monitoring, forecasting and assessment of business as a whole.

Q.2. Distinguish Between:

(1) (2) (3)

Liberalisation and Privatisation. Privatisation and Globalisation. Globalisation and Liberalisation.

Q.3. Write Short Answers for the following:

(1) (2)

(3) (4) (5) (6) (7) (8) (9)

Social Environment of Business Organisation. Define Business Environment. Explain the importance of Business Environment. What are the internal factors of Business Environment? Explain the controllable and uncontrollable factors of Business Environment Explain the factors affecting micro environment. Explain the structure of business environment. Explain the dimensions of Business Environment. What is Technological Environment? Explain its interface with Business. Explain Globalisation, liberalization and Privatisation.

Q.4. Write short notes on the following: Political Environment. (2) Economic Environment (3) Social Environment (4) Legal Environment (5) Technological Environment (6) Interface between Business and Technology. (7) Impact of Government policy changes on Business and Industry. (8) Physical or Natural Environment. (9) Privatisation (10) Globalisation (11) Features of globalization. (12) Need of privatisation

Q.5. Explain the Macro Environment that affects the working of a firm. ******