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Questions and Answers
What does the business environment refer to?
What does the business environment refer to?
- The internal elements used to create market offerings
- The larger societal forces affecting the survival of the organization
- The local forces affecting the organization's ability to serve customers
- The totality of physical and social factors affecting decision-making behavior (correct)
What is included in the external macro environment?
What is included in the external macro environment?
- Internal elements of the organization
- Local forces affecting customer service
- Physical and social factors within the boundaries of the organization
- Demographic, political, cultural, natural, technological, and economic factors (correct)
What is the purpose of analyzing the macro marketing environment?
What is the purpose of analyzing the macro marketing environment?
- To limit the impact of external factors on the organization
- To ignore societal forces and focus on customer service
- To focus solely on the internal environment
- To better understand the environment and adapt to societal changes (correct)
What is the external micro environment composed of?
What is the external micro environment composed of?
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What does the internal environment consist of?
What does the internal environment consist of?
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Study Notes
Business Environment
- Refers to the internal and external factors that affect a business's performance and decision-making
External Environment
- Comprises of macro and micro environments
Macro Environment
- Includes external factors that affect all businesses, such as:
- Economic factors (e.g. inflation, recession)
- Political and legal factors (e.g. government policies, laws)
- Social and cultural factors (e.g. demographics, lifestyles)
- Technological factors (e.g. advancements, innovations)
- Environmental factors (e.g. climate change, sustainability)
Purpose of Analyzing Macro Environment
- To identify opportunities and threats that can impact business strategy and performance
External Micro Environment
- Comprises of external factors that affect an individual business or industry, such as:
- Customers
- Suppliers
- Competitors
- Intermediaries (e.g. distributors, wholesalers)
Internal Environment
- Consists of factors within an organization that affect its performance, such as:
- Organization structure and design
- Corporate culture and values
- Human resources and talent
- Financial resources and systems
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