Business Environment Class 12 MCQ Questions with Answers

Business Environment Class 12 MCQ Questions with Answers

Business Environment Class 12 MCQ Questions with Answers proved to be a great resource for those studying business at the secondary level.

It offered a comprehensive overview of important topics related to business, such as marketing, finance, economics, and management.

The questions and answers gave students the opportunity to test their understanding of the material. Ultimately, this resource can help students gain confidence in their ability to answer difficult questions on exams.

Business Environment

What is Business Environment?

Business environment refers to the external factors and conditions which affect a business. It can include internal and external elements such as customers, competitors, suppliers, government regulations, socio-economic trends, technological advances and even natural disasters.

Understanding how these elements work together to influence a business’s success is an essential part of running any company.

The business environment includes both the macroenvironment—the larger economic context in which the firm competes—and microenvironment—the more immediate environment faced by a firm on daily basis.

Macrosocial forces include population growth rates, age distribution, lifestyle changes, cultural shifts and government policies that affect consumption patterns and production decisions.

Microsocial forces are more localized influences such as customer preferences and competitive strategies in a particular region or market segment. A strong knowledge of both types of environmental factors is critical when making strategic decisions for any business.

Integral elements of business environment

The integral elements of the business environment encompass various factors and conditions that influence a company’s operations, performance, and overall success. These elements are essential for businesses to understand and adapt to in order to thrive. The integral elements of business environment include:

1. Economic Factors: Economic conditions, including inflation rates, interest rates, exchange rates, and overall economic growth, have a significant impact on businesses. A stable and growing economy generally fosters business growth.

2. Market Conditions: The size, structure, and dynamics of the market in which a business operates play a crucial role. Factors such as market demand, competition, and consumer preferences affect a company’s strategy and performance.

3. Political and Legal Environment: Government policies, regulations, and political stability can influence business operations. Understanding and complying with laws and regulations are critical for avoiding legal issues.

4. Social and Cultural Factors: Social trends, demographics, and cultural norms affect consumer behavior and market trends. Companies must adapt their products and services to align with societal values and preferences.

5. Technological Advances: Rapid technological changes can disrupt industries and create new opportunities. Staying updated with the latest technologies is essential for competitiveness.

6. Environmental and Sustainability Concerns: Environmental regulations, sustainability practices, and consumer demand for eco-friendly products and services are increasingly important considerations for businesses.

7. Competitive Landscape: Assessing competitors, their strengths, weaknesses, and strategies is vital for business survival and growth. Competitive intelligence helps in making informed decisions.

8. Supplier and Partner Relationships: The quality and reliability of suppliers and strategic partners can significantly impact a company’s supply chain and overall performance.

9. Labor Force and Human Resources: The availability and skill level of the workforce, as well as labor laws and regulations, influence a company’s ability to attract, retain, and manage talent.

10. Globalization and International Markets: Expanding into international markets can provide growth opportunities but also introduces challenges related to cultural differences, trade regulations, and geopolitical factors.

11. Financial Factors: Access to capital, financing options, and financial stability are critical for business operations and expansion.

12. Technological Infrastructure: The availability and quality of technological infrastructure, such as internet connectivity and transportation networks, impact a company’s ability to operate efficiently.

13. Consumer Behavior: Understanding customer needs, preferences, and buying habits is essential for product development and marketing strategies.

14. Risk and Uncertainty: Businesses must assess and manage various risks, including financial, operational, and market-related uncertainties.

15. Corporate Social Responsibility (CSR): Companies are increasingly expected to engage in socially responsible practices, including ethical business conduct and community involvement.

16. Government and Political Stability: The stability of the government and political environment in a region or country can affect the long-term outlook for businesses operating there.

These integral elements collectively shape the business environment and require continuous monitoring and adaptation by organizations to remain competitive and sustainable in an ever-changing landscape.

Business Environment Class 12 MCQ with Answers

Q1. A firm aims towards ___ allocation of resource-limited in supply with alternative uses.
A. worst
B. optimum
C. finest
D. None of the above
Ans: B

Q2.An economic unit transforms ___ into output.
A. Inputs
B. Raw materials
C. Money
D. None of the above
Ans: A

Q3. The ___ environment refers to the factors that affect the consumer’s purchasing power.
A. Cultural
B. Global
C. Economic
D. Political
Ans: C

Q4. Understanding a business in depth is the goal of ___.
A. External Analysis
B. Internal Analysis
C. Environmental Analysis
D. SWOT Analysis
Ans: B

Q5. The present and future viability of an enterprise are impacted by ___.
A. Environment
B. Culture
C. Time
D. None of the above
Ans: A

Q6. A country’s balance of payments is a record of its ___ with the rest of the world.
A. Non-economic transactions
B. Economic transactions
C. Both of these
D. None of these
Ans: B

Q7. GNI stands for-
A. Gross National Interest
B. Gross Nation Income
C. Gross National Income
D. Gross Nature Income
Ans: C

Q8. The ___ rate is charged by the Reserve Bank for giving loans to commercial banks.
Ans. Bank/Discount

Q9. This fiscal policy is used to cure the recession.
A. Contractionary
B. Expansionary
C. Both of these
D. None of these
Ans: B

Q10. An expansionary monetary policy will cause the interest rate to ___.
A. Fall
B. Increase
C. Decrease
D. None of the above
Ans: A

Q11. The energy crisis has led us to think in terms of modifying our energy policy and more research in alternative energy resources. This is a form of
A. Cultural transmission
B. Cultural shock
C. Organization of culture
D. Cultural adaptation
Ans: D

Q12.what people think of an organization’s actions is called:
A. Viability
B. Values
C. Public image
D. Public visibility
Ans: C

Q13. ___ developed the code of ethics which uses four questions for any ethical issue a business faces.
A. Rotary national
B. Rotary international
C. Rotate international
D. None of the above
Ans: B

Q14. Differentiation based on criteria as age, sex, caste, occupation, education is called ___.
A. Stratification

Q15. ___ is a preferred language of communication in Indian business.
A. Hindi
B. English
C. Marathi
D. All of the above
Ans: B

Q16. A political system is based on the ___ of the ruling government.
A. Ideology
B. Psychology
C. sociology
D. None of the above
Ans: A

Q17. India faced the balance of payment crisis in ___.
A. 1991
B. 1990
C. 1994
D. 1992
Ans: B

Q18. India has a ___ political system.
A. Multiple
B. Singular
C. Plural
D. None of the above
Ans: C

Q19. India embarked on a series of economic reforms in ___.
A. 1991
B. 1990
C. 1994
D. 1992
Ans: A

Q20. In a capitalist system, the consumer is regarded as ___.
A. Inferior
B. Sovereign
C. Submissive
D. None of the above
Ans: B

Q21. The extreme form of socialism is called ___.
A. Communistic
B. Capitalism
C. Communism
D. All of the above
Ans: C

Q22. Economic ___ has replaced the price mechanism under a socialist economy.
A. Stability
B. Inequality
C. Instability
D. Equality
Ans: B

Q23. The ___ is the chairman of the planning commission of India.
A. Prime Minister
B. Chief Minister
C. Home Minister
D. None of the above
Ans: A

Q24. Instead of competing, the private sector ___ the public sector in a mixed economy.
A. Add
B. Supplements
C. Extends
D. None of the above
Ans: B

Q25. The ___ motive which is an integral part of the capitalist economy motivates the producers to undertake production.
A. Loss
B. Beating
C. Profit
D. None of the above
Ans: C

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