AHSEC Class 12 Business Studies Chapter 3 : Business Environment Question Answer can be very Valuable & useful for the Preparation of Assam Higher Secondary Education HS 2nd Year Examination . Assam Board AHSEC HS 2nd Year Business Studies Notes gives you the best information of Business Environment Chapter . You can find solutions to their questions at both basic and advanced levels.
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| AHSEC CLASS 12 BUSINESS STUDIES |
AHSEC Class 12 Business Studies
CHAPTER-3
Business Environment
Short Answer Type Questions: Type - I (Marks -3)
1.What is Business Environment?
Ans. Business environment is the overall climate created by internal and external forces within which an enterprise operates. It is the aggregate of all conditions, events and influences that surround and affect it. The internal environment such as philosophy of the management, organisational objectives, work force, work process etc. are the factors which are under the control of the enterprise. The external factors such as economic conditions, social factors, suppliers, customers etc, influence the enterprise from outside and are beyond its control. Thus, business environ ment is generally referred to all internal forces which have a bearing on the funetioning of business.
2.What is privatisation ?
Ans. Privatisation refers to the transfer of ownership, property or business from government to the private sector. The government ceases to be the owner of the entity or business. It is the process of transferring an enterprise or industry from the public sector to the private sector. The public sector is the part of the economic system that is run by government agencies privatisation may involve either sale of government - held assets or removal of restrictions preventing private individuals and business from participating in a given industry.
3. What is liberalisation policy?
Ans. In general, liberalisation policy refers to a relaxation of government restrictions, usually in such areas of social, political and economic policy. It is the process of freeing the economy from licence system and other regulations. It refers to inte gration of various economies of world. Liberalisation is a very broad term that usually refers to fewer government regulations and restrictions in the economy. It also refers to the relaxation of the previous government restriction usually in area of social and economic policies. When government liberalized trade, it means it has removed the tariff, subsidies and other restriction on the flow of goods and services between the countries.
4.What do you understand by Globalisation?
Ans. Globalisation means integrating the economy of a country with the world economy. This implies that there should not be a bar on the entry of foreign inves tors coming to the country and entrepreneurs from the country are also allowed entry in other countries. There is a free flow of imports and exports and foreign exchange regulations are also avoided Globalisation also implies the opening of local and nationalistic perspectives to a broader outlook of an interconnected and interdependent world with free transfer of capital, goods and services across na tional frontiers.
AHSEC Class 12 Business Studies Important Questions Answers Solution
5.Write three characteristics of business environment.
Ans. Three characteristics of business environment are
(i) Relativity - Business environment is related to the local conditions and this is the reason as to why the business environment happens to be different in different countries and different even in the same country at different places.
(ii) Dynamic Business environment is very dynamic and keeps on changing. It is necessary to keep a constant watch on changes and scan their impact on the busi ness.
(iii) Complex-Business environment is very complex since it is influenced by a number of factors. It is very difficult to judge the impact of changes in business.
6.Write three important negative impacts of globalisation in India.
Ans. Three negative impacts of globalisation in India are -
(i) Rising competition-Liberalisation of Foreign Trade policies allowed the import of electronic goods at a very cheap cost. Local producers of electronic goods were not able to meet with this challenge.
(ii) Uncertain Employment-In order to complete in the world market exporters try and cut labour costs. Workers are denied their fair share of benefits as manufacturers are always on the look out for cheaper labour.
7. Write three effects of political environment.
Ans. Three effects of political environment are as follows -
(i) Impact on the economy - The political environment in a country affects its eco nomic environment. The economic environment, in turn, affects the performance of a business organisation.
(ii) Mitigation of risk-one way to manage political risk is to buy political risk insurance. Organizations that have international operations use this type of insurance to miti gate their risk exposure as a result of political instability.
(iii) Changes in Regulation-Government should change their rules and regulations, and this could have an effect on a business.
8.Explain the key components of economic environment.
Ans. The key components of economic environment are discussed below:
(i) Economic systems - Economic system determines the scope of private sector own leadership of the factors of production and market forces.
(ii) Economic conditions - They indicate the health of the economy in which the organisation operate. The factors affecting economic conditions are:
(a) State of economic development
(b) Income
(e) Employment etc.
(ii) Regional economic groups - They promote cooperations and free trade among members by removing tariff and other restrictions. They provide opportunities to the member countries and threats to non-member countries.
9.Write three features of New Industrial Policy.
Ans. Three features of New Industrial Policy are as follows
(i) Delicensing - The most important features of New Industrial Policy, 1991 was the abolition of industrial licensing of all industries except six industries which are alcohol, cigarettes, industrial explosives, defence, products etc.
(ii) Liberalisation of Foreign investment-Prior to this policy, it was necessary to obtain approval from the government in respect of foreign investment.
(iii) Disinvestment of public sector- The New Industrial policy 1991 permitted disin vestment of public sector units Disinvestment is a process of selling government equity in PSUS in favour of private parties
Short Answer Type Questions: Type - II (Marks -4)
1.Write the various components of economic environment.
Ans. Economic environment includes all those forces which regulates resources, factors of production, generation and distribution of income and wealth in a social set up. The various components of economic environment are as follows -
(i)Nature of economy
(ii) Capital markets
(iii) Competition
(iv) Infrastructure
(v) Demand patterns.
(vi) Economic policies such as industrial policy, business laws etc.
2. How does social and technological environment influence the working of a business?
Ans. Social environment consists of the customs and traditions of the society in which business is existing. It includes the standard of living, taste, preferences and education level of the people living in the society where business exists. The busi ness man cannot overlook the components of social environment as these compo nents may not have immediate impact on the business but in the long run the social environment has great impact on the business Technological environment refers to changes taking place in the method of produc tion, use of new equipment and machines to improve the quality of product. The businessman must closely monitor the technological changes taking place in his industry because he will have to implement these changes to remain in the competitive market.
Long Answer Type Question (Mark - 5)
1. Write about three component of economic environment.
Ans. Three major component of economic environment are -
(i) Nature of economic system - The nature of economic system of a country is a crucial determinant of the shape of economic environment.
(ii) Role of government The government influences the economic environment of business through economic planning, fiscal policies, industrial regulation, commercial laws, controls on wages and prices and export import policy. (i) Organisation of capital market - The organisation of capital market and its development help in determining the economic development
2.Discuss in details about the different component of business environment.
Ans. The different component of business environment are Economic environment-Several economic factors present in the environment af fect the demand, supply, services, price, availability of product etc. Economic environment consists of economic growth, Fiscal policies, Economic stability and in come levels.
(1) Political environment-All business firms are affected in greater and lesser degree by government programmes at central, state or local levels. Political stability, politi cal organisation and government influence the political environment in business
(ii) Technological Environment - Technology has shaped the face of human life faster than the pace of human. The advent of telephone, television, computer etc. has been very useful for the present generation. Technological development may in crease the demand for some existing product.
(iv) Regulatory environment- The regulatory environment is constituted by various factors related to planning, promotion and control economic activities by the govern ment to take care of the interest of common man. The government frames various laws, rules and regulations concerning business which must be followed by business.organisation
(v) Cultural environment - The socio-cultural forces are very important that should analysed while formulating business strategies. The socio-cultural environment de termines the value system of a society.
3. What are the obstacles to to globalisation in India.
Ans. The Indian business suffers from a number of disadvantages in respect of globalisation of business. The important problems are as follows.
(i)The government policy and the bureaucratic culture in India in this respect are not encouraging.
(ii) The technology employed, mode and style of international trade barriers.
(iii) Improvement of balance of payment as a result of increased export
(iv) Increased flow of foreign direct investment in the country.
4. Explain the impact of government policy changes on business and industry.
Ans. The impact of government policy changes on business and industry in India in the context of liberalisation and globalisation may be highlighted as under
(a) As a result of globalisation, the share of India in world export has increase over the year
(b) The impact sector has brought new technology and product there by increased the quality, availablity and choice for Indian consumer.
(c) Liberalisation of licencing has enhance the production, distribution and increase profitability of emerging Indian market.
(d) The entry of MNC into Indian untapped market has made competition the other order of the day of operation etc are in general, absolete and these seriously affect the competitiveness.
(e) The general lack of experience in managing international business is another important problem.
(f) Because at the small size and level of resources in many cause Indian firms are not able to complete with the giant at other countries.
(g) The competition is growing not only from the firm in the develop countries but also form the developing country firm.
AHSEC Class 12 Business Studies Important Questions Answers Solution
5. Explain in brief five economic changes that has been initiated by govt. of India since 1991.
Ans. Five economic changes that has been initiated by the Govt of India since 1991 are
(i) Improvement in supply of goods and services due to increase competition.
(ii) Better standard of living of people as a result of availability of better quality of goods and services.
(iii) The increase competition has force near death of inferior brand or product
(iv) The new competition has shown greater need for more reform in the like telecommunication, insurance etc. view sector
6. How does social and technologiocal environment influence the working of a business.
Ans. Social environment - Social environment consist of all the social and cultural forces within which firms operate. It consist of social set up, cultural, moral, ethical values of the society, standard of living of people, tastes, preferences, education level etc. Social and cultural values exercise a significant influence on business. For e.g.. There are certain occasions like Diwali, Christmas, Eid, etc when people make maximum purchase of sweets, clothes and other goods.
Technological environment - Technology has shaped the face of human life faster. Technological environment relates to scientific improvements and innovation prov ing never and better methods of production and techniques of operating business. For eg..-T.V., Home shopping etc are the result of technological changes
AHSEC HS 2nd Year Business Studies Important Questions Answers, With Proper Solution.
7.How is business influence by political and legal environment.
Ans. (a) Political environment - All business firms are affected in greater or lesser degree by the government programmes at central, state or local levels. Business men try to anticipate changes in government policy or in the political forces so that they may be able to operate successfully. Political stability, political organisation and government intervention influence the political environment in business.
(b) Legal environment Legal forces are gaining considerable important in business activities and operation. Legislation controlling physical environment like anti pollution laws also influence business plans and policies. In modern time many countries have specific legislation to protect consumer invest Legal system is a part and parcel of business. Knowledge of business law is essen tial for many management decision.
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Also View : AHSEC HS 2nd Year Business Study Complete Chapter wise Important Question Answer 2024
CHAPTER-WISE SOLUTION FOR BUSINESS STUDIES
SL.NO | CHAPTER | LINK |
| 1 | Nature and Significance of Management | Click here |
| 2 | Principles of Management | Click here |
| 3 | Business Environment | Click here |
| 4 | Planning | Click here |
| 5 | Organising | Click here |
| 6 | Staffing | Click here |
| 7 | Directing | Click here |
| 8 | Controlling | Click here |
| 9 | Business Finance | Click here |
| 10 | Financial Market | Click here |
| 11 | Marketing Management | Click here |
| 12 | Consumer Protection Act. | Click here |
AHSEC HS 2nd Year Business Studies Solutions
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