case study class 12 business studies chapter 3

CBSE Class 12 Case Studies In Business Studies – Business Environment

BUSINESS ENVIRONMENT Business Environment: Definition The term ‘business environment’ means the sum total of all individuals, institutions and other forces that are outside the control of a business enterprise but that may affect its performance.

Importance of Business Environment

• It enables the firm to identify opportunities and getting the first mover advantage instead of losing them to its competitors.
• It helps the firm to identify threats and early warning signals which are likely to hinder a firm’s performance and take timely actions.
• It helps in tapping useful resources as the enterprise designs policies that allow it to get the resources that it needs so that it can convert those resources into outputs that the environment desires.
• It helps in coping with rapid changes as the managers are able to understand and examine the environment and develop appropriate courses of action.
• It helps in assisting in planning and policy formulation as its understanding and analysis can be the basis for deciding the future course of action or decision making. It helps in improving performance of an enterprise through continuous monitoring of the environment and adopting suitable business practices which help to improve both their present and future performance
• It helps in improving performance of an enterprise through continuous monitoring of the environment and adopting suitable business practices which help to improve both their present and future performance.

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Features of Business Environment

• It is a sum total of all the forces external to business firms.
• It consists of both specific forces such as investors, customers, competitors and suppliers which affect individual enterprises directly and immediately in their day-to¬day working and general forces such as social, political, legal and technological conditions which have impact on all business enterprises and thus may affect an individual firm only indirectly.
• All the elements of business environment are closely interrelated.
• It is dynamic in nature and keeps on changing due to technological upgradations, shifts in consumer preferences or increase in competition in the market.
• It is highly uncertain as it is not always possible to predict future happenings, especially when environment changes are taking place too frequently as in the case of information technology or fashion industries.
• It is complex in nature as it is relatively easier to understand in parts but difficult to comprehend in its totality because it consists of numerous interrelated and dynamic conditions or forces which arise from different sources.
• It is a relative concept since it differs from country to country and even region to region

DIMENSIONS OF BUSINESS ENVIRONMENT Dimensions of the business environment include economic, social, technological, political and legal conditions which are considered relevant for decision-making and improving the performance of an enterprise.

Various Factors Constituting the General Environment of Business

• Economic Environment comprises of factors that can affect management practices ina business enterprise. It includes interest rates, inflation rates, changes in disposable income of people, stock market indices and the value of rupee etc.
• Social Environment includes the social forces like customs and traditions, values, social trends, society’s expectations from business, etc.
• Technological Environment includes forces relating to scientific improvements and innovations which provide new ways of producing goods and services and new methods and techniques of operating business.
• Political Environment includes political conditions such as general stability and peace in the country and specific attitudes that elected government representatives hold towards business.
• Legal Environment includes various legislations passed by the Government administrative orders issued by government authorities, court judgments as well as the decisions rendered by various commissions and agencies at every level of the government— center, state or local.

ECONOMIC ENVIRONMENT IN INDIA  Various Macro-level Factors of Economic Environment in India

• Stage of economic development of the country.
• The economic structure in the form of mixed economy which recognises the role of both public and private sectors.
• Economic policies of the Government, including industrial, monetary and fiscal policies.
• Economic planning, including five year plans, annual budgets, and so on.
• Economic indices, like national income, distribution of income, rate and growth of GNP, per capita income, disposal personal income, rate of savings and investments, value of exports and imports, balance of payments, etc.
• Infrastructural factors, such as, financial institutions, banks, modes of transportation communication facilities etc.

The Constituents of Economic Environment of Business in India at the time of Independence

• The Indian economy was mainly agricultural and rural in character.
• About 70% of the working population was employed in agriculture.
• About 85% of the population was living in the villages.
• Production was carried out using irrational, low productivity technology
• Communicable diseases were widespread, mortality rates were high and there was no good public health system.

Key Aspects of the Economic Planning in India After Independence

• Initiate rapid economic growth to raise the standard of living, reduce unemployment and poverty.
• Become self-reliant and set upa strong industrial base with emphasis on heavy and basic industries.
• Reduce inequalities of income and wealth.
• Adopt a socialist pattern of development— based on equality and prevent exploitation of man by man.

NEW INDUSTRIAL POLICY OF 1991 Three Major Componenets of New Industrial Policy of 1991

• Liberalisation
• Privatisation
• Globalisation

Disinvestment definition Disinvestments refers to transfer from public sector enterprises to the private sector through dilution of state of the Government in the public enterprise

The Broad Feature of New Industrial Policy, 1991

• The Government reduced the number of industries under compulsory licensing to six.
• Many of the industries reserved for the public sector under the earlier policy, were dereserved. The role of the public sector was limited only to four industries of strategic importance.
• Disinvestment was carried out in case of many public sector industrial enterprises.
• The share of foreign equity participation was increased and in many activities 100 per cent Foreign Direct Investment (FDI) was permitted.
• Automatic permission was now granted for technology agreements with foreign companies.
• Foreign Investment Promotion Board (FIPB) was set up to promote and channelise foreign investment in India.

Liberalisation  These economic reforms signalled the The new set of economic Globalisation means the end of the licence-permit-quota raj reforms aimed at giving integration of the various and were aimed at liberalising the greater role to the private economies of the world Indian business and industry from all sector in the nation building leading towards the unnecessary controls and restrictions. Simplifying procedures for imports and exports. Key initiatives of the government:

• Abolishing licensing requirement in most of the industries except a short list .
• Freedom in deciding the scale of business activities
• Removal of restrictions on the movement of goods and services.
• Freedom in fixing the prices of goods and services.
• Reduction in tax rates and lifting of unnecessary controls over the economy.
• Making it easier to attract foreign capital and technology to India.

Privatisation The new set of economic Globalisation means the end of the licence-permit-quota raj reforms aimed at giving integration of the various and were aimed at liberalising the greater role to the private economies of the world Indian business and industry from all sector in the nation building leading towards the unnecessary controls and restrictions. process and a reduced role emergence of a cohesive to the public sector. Key initiatives of the government:

• Adopted the policy of planned disinvestments of the public sector.
• Decided to refer the loss making and sick enterprises to the Board of Industrial and Financial Reconstruction.

Globalisation These economic reforms signalled the The new set of economic Globalisation means the end of the licence-permit-quota raj reforms aimed at giving integration of the various and were aimed at liberalising the greater role to the private economies of the world Indian business and industry from all sector in the nation building leading towards the unnecessary controls and restrictions. process and a reduced role emergence of a cohesive to the public sector. global economy. Key initiatives of the government:

• Import liberalisation and export promotion through rationalisation of the tariff structure and reforms with respect to foreign exchange.
• Increased level of interaction and interdependence among the various nations of the global economy.

Impact of Government Policy Changes on Business and Industry/ Challenges faced by the Indian Corporate Sector

• Increasing competition for Indian firms due to changes in the rules of industrial licensing and entry of foreign firms.
• More demanding customers as they are more aware and are offered wider choice in purchasing better quality of goods and services due to high competition.
• Repidly changing technological environment creates tough challenges before smaller firms.
• Necessity for change in the way of their operations.
• Need for developing human resource as the new market conditions require people with higher competence and greater commitment. Hence the need for developing human resources.
• Market orientation as the firms have to study and analyse the market first and produce goods accordingly.
• Loss of budgetary support to the public sector has declined over the years

Managerial Response to Changes in Business Environment

• Acquisitions and mergers
• Diversification
• Brand building
• Innovative distribution and selling techniques.
• Changes in capital structure
• Customer-oriented approach
• Technological developments
• Better labour relations

LATEST CBSE QUESTIONS

Question 1: Metlapp Networks and Technologies Ltd. is a leader in technology innovation in the United States, creating products and solutions for connecting the world. It has,, a large research and development team which invented the first smart watch, named as W-7. The watch besides showing the time, also monitors few health parameters like heart beat, blood pressure etc. While in search of markets abroad, the company found that in India, the reform process was underway with the aim of accelerating the pace of economic growth. The company decided to take advantage of simplified export procedure and removal of quantitative as well as tariff restrictions in India. It set up its office in Jamnagar with a view to capture the Indian market. In a short span of time, the company emerged as a market leader. Success of the company attracted many other players to enter the market. Competition resulted in reduction in prices, thereby benefiting the customers.

• In the above paragraph, two major concepts related to government policy have been discussed. Identify and explain these concepts.
• Also, explain briefly any three impacts of these concepts on Indian business and industry.
• Liberalisation: These economic reforms signalled the end of the licence-pemit-quota raj and were aimed at liberalising the Indian business and industry from all unnecessary controls and restrictions.
• Globalisation: Globalisation means the integration of the various economies of the world leading towards the emergence of a cohesive global economy.
• Increasing competition: The Indian firms are facing lot of competition due to changes in the rules of industrial licensing and entry of foreign firms. This change is more apparent in the sectors which were earlier reserved for private sector only like banking, insurance, telecommunications, etc.
• More demanding customers: With the easy availability of wider choice in purchasing better quality of goods and services due to high competition consumers have become more aware and demanding. The growing expections of the consumers has increased the pressure on the business firms.
• Rapidly changing technological environment: With the entry of new firms which are far more superior in terms of technology the small firms are facing a lot of challenges. Moreover, the firms are constantly involved in innovating new products and upgrading present products with the help of better technologies in order to satisfy the customers demands.

Question 2: Naman and Govind after finishing their graduation under vocational stream decided to start their own travel agency which will book Rail Tickets and Air Tickets on commission basis. They also thought of providing tickets within ten minutes through the use of internet. They discussed the idea with their Professor Mr. Mehta who liked the idea and suggested them to first analyse the business environment which consists of investors’, competitors and other forces like social, political etc. that may affect their business directly or indirectly. He further told them about the technological improvements and shifts in consumer preferences that were taking place and hence they should be aware of the environmental trends and changes which may hinder their business performance. He emphasised on making plans keeping in mind the threat posed by the competitors, so that they can deal with the situation effectively. This alignment of business operations with the business environment will result in better performance.

• Identify and state the component of business environment highlighted in the above Para.
• State any two features of business environment as discussed by Professor Mehta with Naman and Govind.
• Also state two points of importance of business environment as stated by Professor Mehta in the above situation.
• Technological Environment is the component of business environment highlighted in the above Para. Technological Environment includes forces relating to scientific improvements and innovations which provide new ways of producing goods and services and new methods and techniques of operating a business.
• Dynamic nature: It is dynamic in nature and keeps on changing due to technological upgradations, shifts in consumer preferences or increase in competition in the market.
• Inter-relatedness: All the elements of business environment are closely interrelated. Therefore, any change is one element may necessitate corresponding changes in the other elements as well.
• It enables the firm to identify opportunities and getting the first mover advantage: The dynamic business environment provides numerous opportunities for a business to evolve as per the changing needs. Therefore, early identification of the forthcoming opportunities helps an enterprise to be the first to exploit them instead of losing them to the competitors.
• It helps the firm to identify threats and early warning signals: Sometimes the changes in the external environment may pose as a threat and hinder a firm’s performance. An awareness about the business environment helps the managers to identify such threats on time and take necessary decisions and action.

Question 3: With changes in the consumption habits of people, Neelesh, who was running a sweet shop, shifted to the chocolate business. On the eve of Diwali, he offered chocolates in attractive packages at reasonable prices. He anticipated huge demand and created a website chocolove. com for taking orders online. He got a lot of orders online and earned huge profits by selling the chocolate. Identify and explain the dimensions of business environment discussed in the above case. Answer: The various dimensions of business environment being referred to in the above case are as follows:

• Social environment: Social Environment includes the social forces like customs and traditions, values, social trends, society’s expectations from business, etc.
• Technological environment: Technological Environment includes forces relating to scientific improvements and innovations which provide new ways of producing goods and services and new methods and techniques of operating a business.

Question 4: A recent rate cut in the interest on loans announced by the banks encouraged Amit, a science student of Progressive School, to take a loan from State Bank of India to experiment and develop cars to be powered by fuel produced from garbage. He developed such a car and exhibited it in the Science Fair organised by the Directorate of Education. He was awarded the first prize for his invention. Identify and explain the dimensions of business environment discussed in the above case. Answer: The various dimensions of business environment being referred to in the above case are as follows:

• Economic Environment: It comprises of factors that can affect management practices in a business enterprise includes interest rates, inflation rates, changes in disposable income of people, stock market indices and the value of rupee etc.
• Technological Environment: It includes forces relating to scientific improvements and innovations which provide new ways of producing goods and services and new methods and techniques of operating a business.

Question 5: ‘Accent Electronics Ltd.’ was operating its business in Malaysia. The company started exporting its products to India when the Prime Minister announced relaxation in import duties on electronic items. The company appointed retailers in India who had direct online links with the suppliers to replenish stocks when needed. Identify and explain the dimensions of business environment discussed in the above case. Answer: The various dimensions of business environment being referred to in the above case are as follows:

• Political Environment: Political Environment includes political conditions such as general stability and peace in the country and specific attitudes that elected government representatives hold towards business.
• Technological Environment: Technological Environment includes forces relating to scientific improvements and innovations which provide new ways of producing goods and services and new methods and techniques of operating a business.

Question 6: After completing her MBA, Beni took up a job with a multinational company named Fortio. The company paid good salaries and perks to its employees. The wages were within the paying capacity of the company that provided the employees with a reasonable standard of living. The company also had a good work-culture and the behaviour of superiors was very good towards their subordinates. Beni was very happy in this organisation but due to long working hours, she did not have time to cook her meals. She had to depend upon outside food which was deteriorating her health. She observed that this problem was faced by many of her colleagues, not only in her company but also in many other companies. This was because of increase in the number of working women and non-availability of hygienic home-cooked food. She identified this as a great opportunity and decided to give up her job to supply packaged home-cooked food to office-goers at a reasonable price. At the end of the day, she also distributed the leftover food to the nearby night-shelters.

• State the dimension of business environment being discussed above.
• State the principle of management being followed by Fortio.
• Identify any two values being communicated by the company to society in above case.
• The dimension of business environment being discussed above is Social. Social Environment includes the social forces like customs and traditions, values, social trends, society’s expectations from business, etc.
• The principle of management being followed by Fortio is ‘Remuneration of employees’. Remuneration of employees: The overall pay and compensation should be fair to both employees and the organization. The employees should be paid fair wages, which should give them at least a reasonable standard of living. At the same time it should be within the paying capacity of the company i.e. remuneration should be just and equitable.
• Ethical Behaviour

Question 7: After completing his MBA from the USA, Mr. Ajay came to India to start a new business under the banner Ecom Creations Ltd. He launched a new product in e-learning for senior secondary school students in the commerce stream which already had an established market in the UK and the USA but not in India. His business started flourishing in India. As a result, more Indian companies entered into the market with other subjects also. Identify and quote the lines from the above paragraph which highlight the significance of understanding business environment. Answer:

• The understanding of business environment helps in assisting in planning and policy formulation as its understanding and analysis can be the basis for deciding the future course of action or decision making. It enables the firm to identify opportunities and getting the first mover advantage instead of losing them to its competitors. ” After completing his MBA from USA, Mr. Ajay came to India .to start a new business under the banner Ecom Creations Ltd. He launched a new product in e-learning for senior secondary school students in the commerce stream which already had an established market in UK and the USA but not in India.”
• It helps in improving performance of an enterprise through continuous monitoring of the environment and adopting suitable business practices which help to improve both their present and future performance. “His business started flourishing in India.”
• It helps the firm to identify threats and early warning signals that is likely to hinder a firm’s performance and take timely actions. “As a result, more Indian companies entered into the market with other subjects.”

Question 8: As per the directions issued by the Supreme Court, the government passed an order to ban the sale of tobacco products within the area of 200 meters of all educational institutions as:

• Its consumption is injurious to health.
• People are becoming more conscious about health and fitness. This indicates the government’s attitude towards this business. Identify the business environment under three different dimensions by quoting from above paragraph.

Answer: The various dimensions of business environment being referred to the in the above case are as follows:

• Legal Environment: “As per the directions issued by the Supreme Court.’
• Political Environment: “The government passed an order to ban the sale of tobacco products within the area of 200 meters of all educational institutions.”
• Social Environment: “Its consumption is injurious to health and people are becoming more conscious about health and fitness.”

Question 9: The court passed an order to ban polythene bags as:

• These bags create many environmental problems which affect the life of people.
• Innovative techniques are being developed to manufacture jute bags at low rates.
• Incomes are rising and people can afford to buy these bags. Identify the different dimensions of business environment by quoting lines from the above particulars.

Answer: The various dimensions of business environment being referred to in the above case are as follows:

• Legal Environment: “The court passed an order to ban polythene bags.”
• Social Environment: “The bags create many environmental problems which affect the life of people and society at large is more concerned about the,,quality of life.”
• Political Environment: “The government decided to give a subsidy to the jute industry in order to promote this business.”
• Technological environment: “Innovative techniques are being developed to manufacture jute bags at low rate.”
• Economic Environment: “Incomes are rising and people can afford to buy these bags.”

Question 10: The court passed an order that all schools must have water purifiers for the school children as:

• Society in general is more concerned about the quality of life. .
• Innovative techniques are being developed to manufacture water purifiers at competitive rates.
• Incomes are rising and children are drinking purified water at their homes as well.
• The Government is also showing a positive attitude towards the business of water purification. Identify the different dimensions of business environment by quoting from the above details.
• Legal Environment: “The court passed an order that all schools must have water purifiers for the school children.”
• Social Environment: “Society in general is more concerned about the quality of life.”
• Political Environment: “The government is also showing a positive attitude towards the business of water purifiers.”
• Technological environment: “Innovative techniques are being developed to manufacture water purifiers at competitive rate.”
• Economic Environment: “Incomes are rising and children are drinking purified water at their homes as well.”

Question 11: Just after the declaration of the results of the Lok Sabha Elections, 2009, the Bombay Stock Exchange’s price index (Sensex) rose by 2100 points in a day. Identify the environmental factor which led to this rise. Answer: Political environment has led to the rise in the sensex.

Question 12: The Government of India is seriously thinking of allowing the oil-marketing public sector undertaking to fix their own prices for petrol and diesel. Which economic reform is the reason for this change in the government’s policy? Answer: Privatisation as a reform is the reason for this change in the government policy.

ADDITIONAL QUESTIONS

Question 1: On 8 November 2016, the Government of India announced the demonetisation making all Rs.500 and Rs. 1,000 banknotes of the Mahatma Gandhi Series invalid past midnight. The government claimed that the action would curtail the use of illicit and counterfeit cash to fund illegal activity and terrorism. The BSE SENSEX and NIFTY 50 stock indices fell over 6 percent on the day after the announcement. The decision was heavily criticised by members of the opposition parties, leading to debates in both houses of parliament and triggering organised protests against the government in several places across India. People seeking to exchange their bank notes had to stand in lengthy queues, and several deaths were linked to the inconveniences caused due to the rush to exchange cash. After demonetisation the demand for point of sales (POS) or card swipe machines has increased. E-payment options like PayTM has also seen a rise. In context of the above case:

• Identify and explain the various dimensions of business environment which relate to the above mentioned case.
• List any through two values that the government seeks to promote through demonetisation.
• Legal environment: Legal Environment includes various legislations passed by the Government administrative orders issued by government authorities, court judgments as well as the decisions rendered by various commissions and agencies at every level of the government— centre, state or local .
• Economic Environment: Economic Environment comprises of factors that can affect management practices in a business enterprise includes interest rates, inflation rates, changes in disposable income of people, stock market indices and the value of rupee etc.
• Transparency in dealings
• Promote well being of people

Question 2: Post demonitisation in a further push to cashless economy, the Central cabinet has recently approved the ordinance for paying wages via electronic means. Accordingly, the government approved to Amend Section 6 of the Payment Of Wages Act 1936, to allow employers of certain industries to make payment through the electronic mode and cheques . The new ordinance will be applicable to the public sector. Identify the various dimensions of business environment which relate to the above mentioned case. Answer: The various dimensions of business environment which relate to the above mentioned case stated below:

• Political environment
• Legal environment
• Technology environment

Question 3: Make in India is an initiative launched by the Government of India to encourage national and multinational companies to manufacture their products in India. It focuses on job creation and skill enhancement and is in twenty five sectors of the economy. Under the initiative, brochures on these sectors and a web portal were released. The initiative aims at high quality standards and minimising the impact on the environment. It also seeks to attract foreign capital investment in India. In context of the above case:

• Identify the various dimensions of business environment being referred to by quoting lines from the paragraph.
• List any two values which the Government of India wants to convey through this initiative.
• Political Environment: “Make in India is an initiative launched by the Government of India to encourage national and multinational companies to manufacture their products in India.”
• Technological Environment: “Under the initiative, brochures on the twenty five sectors and a web portal were released.”
• Economic Environment: “It also seeks to attract foreign capital investment in India.”
• High quality standards
• Concern for environment

Question 4: India’s retail sector has been undergoing structural changes for the last two decades. On one hand, the ‘mall culture’ has gradually become a way of life, especially in the metros and mini¬metros. On the other hand, there is accelerated growth in e-business as customers also prefer to buy products and services via the Internet, telephone and television. However, operating in either of the segments is marked by the presence of strong competitors. Identify the components of specific forces and general forces being discussed in the above paragraph. Answer: The components of specific forces discussed in the above paragraph are the customers and competitors. The components of general forces discussed in the above paragraph is the social and technological conditions.

Question 5: Kapil Sharma is working as the Country Head of a company which owns a chain of malls under the name of ‘Virtuoso’ in the various parts of India. Through an analysis report of the business environment, it has been brought to his notice that in the coming years, shopping at a mall will not be a necessity for the buyers as purchases can be made online from anywhere and at any time with ease and at the consumer’s convenience. Hence, malls will have to provide much more than shopping to be able to attract customers. So, he recommends that ‘Virtuoso’ malls should to be restructured into recreation centres, offering more spaces to socialise, host events and concerts, and provide ample Food and Beverages options. Consequently the share of entertainment segment and Food and Beverages segment in the overall mall space is increased by 20%. As a result, the company gains enormously by getting the first mover advantage. In context of the above case :

• Define the term ‘Business Environment’.
• Explain the terms ‘Threats’ and ‘Opportunities’ by quoting lines from the paragraph.
• The term ‘Business Environment’ means the sum total of all individuals, institutions and other forces that are outside the control of a business enterprise but that may affect its performance.
• The term ‘Threats’ refers to the external environment, trends and changes that will hinder a firm’s performance. “Through an analysis report of the business environment, it has been brought to his notice that in the coming years, shopping at a mall will not be a necessity for the buyers as purchases can be made online from anywhere and at any time with ease and at the consumer’s convenience. Hence, malls will have to provide much more than shopping to be able to attract customers.” The term ‘opportunities’ refers to the positive external trends or changes that will help a firm to improve its performance. “As a result, the company gains enormously by getting the first mover advantage.”

Question 6: “Zero Defect Zero Effect” (ZED) is a slogan coined by the Prime Minister of India, Narendra Modi with reference to the Make in India initiative launched by the government. The slogan reflects the efficiency of production processes, i.e. the products have no defects and the process through which the product is made has zero adverse environmental and ecological effects. The ZED model aims to make India the manufacturing hub of the world and prevent the products developed in India from being rejected by the global market. Moreover, before the initiative was launched, the limits of foreign direct investment in various sectors had been relaxed. The application for licences was made available online and the validity of licences was increased to three years. Various other norms and procedures were also relaxed by the government. In the light of the above paragraph, identify and explain the major component of New Economic Policy of 1991 that are being referred to by quoting lines from the paragraph. Answer: The major components of New Economic Policy of 1991 that are being referred to are as follows:

• Liberalisation: These economic reforms signalled the end of the licence-pemit-quota raj and were aimed at liberalising the Indian business and industry from all unnecessary controls and restrictions. “Moreover, before the initiative was launched, the limits of foreign direct investment in various sectors had been relaxed. The application for licences was made available online and the validity of licences was increased to three years. Various other norms and procedures were also relaxed by the government.”
• Globalisation: Globalisation means the integration of the various economies of the world leading towards the emergence of a cohesive global economy. “The ZED model aims to make India the manufacturing hub of the world and prevent the products developed in India from being rejected by the global market.”

Question 7: It is interesting to know that the menu items of the multinational food chains are customised to suit the general palates of the local people in the region. When McDonald’s started its business in India in the year 1996, the company went through a complete localisation strategy. McDonald’s changed its product menu to accommodate the vegetable burger given the large vegetarian population. It also altered its store design and even reduced the product price by close to fifteen per cent. Also , the “McAloo Tikki burger” is not available anywhere but in the Indian outlets of McDonalds. Identify the relevant feature of business environment being discussed above. Answer: Relativity is the relevant feature of business environment which is being discussed above.

Question 8: Eco-friendly products are gaining power as the consumers’ awareness about environmental issues has increased over the years and they are conscious about choosing products that do not have adverse effects on the environment. They are now more conscious about the carbon emission and climate change effects, and want themselves to be ‘seen’ as a green advocate among their peers. In such a scenario, it has become a challenge for the companies as they have to not only meet the needs of the consumers but also ensure that their products are safe and environment friendly. As a result, there is growing need for better and advanced technologies to works as a catalyst in this regard.

• Identify the relevant feature of business environment being discussed above.
• Describe briefly any three points which highlight the importance of business environment and its understanding by managers.
• Inter-relatedness is the relevant feature of business environment which is being discussed above.
• It helps in tapping useful resources: As the enterprise designs policies that allow it to get the resources that it needs so that it can convert those resources into outputs that the environment desires.

Question 9: In the year 2016, the State Government of Kerala had made it mandatory for anganwadis hostels and canteens in educational institutions to secure the Food Safety and Standards Authority of India (FSSAI) licence to ensure food safety. As the educational institutions also get categorised as food business operators in the event of the annual turnover of the hostels, they run exceeding Rs. 12 lakh per annum. In context of the above case:

• Identify and explain the various dimensions of business environment being referred to here.
•  List any two values which the State Government of Kerala wants to convey through this initiative.
• Political Environment: Political environment includes political conditions such as general stability and peace in the country and specific attitudes that elected government representatives hold towards business.
• Legal Environment: Legal environment includes various legislations passed by the government administrative orders issued by government authorities, court judgments as well as the decisions rendered by various commissions and agencies at every level of the government -Center, State or Local .
• Good health

Question 10: Postage stamps have been unveiled to commemorate 140 years of existence of the country’s first stock exchange the Bombay Stock Exchange (BSE). The setting up of BSE is considered to be the greatest revolution that took place in the financial markets in India as it acts as a key driver for economic growth of a country. This is due to the fact that there exists a strong corelation between economic growth and capital accumulation. In the context of the above case:

• Identify the dimension of business environment of India being referred here.
• State any three factors which broadly affect the dimension of business environment of India as identified in part (a) of the question.
• Economic environment is the dimension of business environment of India being referred here.

Question 11: The organic food market in India is growing at 25-30 per cent which reflects a clear shift in consumer tastes and preferences. The current growth in the organic food market is driven by multiplicity of factors like rising health consciousness, changing lifestyles, increase in disposable income and growing availability of organic food products in shopping malls, retail outlets and online. In context of the above case:

• Identify and explain the features of business environment being referred to here.
• By quoting phrases from the paragraph identify the various components of general forces which have led to a growth in the organic food market.
• Social: “rising health consciousness, changing lifestyles”
• Economic: “increase in disposable income”
• Technological: “growing availability of organic food products in shopping malls, retail outlets and online.”

Question 12: Anurag, aspires to work with a socially and environmentally committed company as he does not want to work just for monetary benefits but also the brand value of the company he works for in the society matters a lot to him. Therefore, he has joined Cerebra Integrated Technologies a Bengaluru-based Infotech company. The company has built India’s largest e-waste recycling plant. The company strives to be one of the leading players in this business which has huge potential not only in terms of generating huge revenues and profits but also wants to contribute to the environment issues that have become crucial worldwide. The company sees big business in the mountains of e-waste in Bengaluru which produces 200,000 tonnes of e-waste a year. The company plans to make its millions by extracting metals such as gold and platinum from the e-waste piling up in the city. As a mobile phone, for example, is made up of a combination of rare earth and precious metals: it contains 250 mg of silver, 24 mg of gold and nine mg of palladium while a laptop has 1,000 mg of silver, 220 mg of gold and 500 grams of copper. To start the business, the company has obtained a licence from KSPCB ( Karnataka State Pollution Control Board) . In context of the above case:

• List any two values which the company wants to convey to the society.
• Technological Environment: Technological environment includes forces relating to scientific improvements and innovations which provide new ways of producing goods and services and new methods and techniques of operating a business.
•  administrative orders issued by government authorities, court judgments as well as the decisions rendered by various commissions and agencies at every level of the government— center, state or local.
• Social Environment: Social environment includes the social forces like customs and traditions, values, social trends, society’s expectations from business, etc.
• Sustainable development
• Concern for environment.

Question 13: The government wants to raise Rs.56,500 crore from the sale of stakes in state-owned enterprises National Thermal Power Corporation (NTPC) in the financial year 2016-17. Identify and explain the related concept. Answer: Disinvestment: Disinvestment refers to transfer in the public sector enterprises to the private sector through dilution of stake of the Government in the public enterprise.

Question 14: Bharat is running an ice cream parlour in a local market. Keeping in mind the changing perceptions about health among the people, one of his employee Abhiraj suggests to him that they should introduce a range a flavoured yogurt. Bharat accepts his suggestion as a result both the image and the profitability of his business increases. In the context of the above case:

• Identify the feature of management which is being highlighted.
• State the related dimension of the business environment.
• Name and explain the related principle of general management.
• The feature of management which is being highlighted is Dynamic.
• The related dimension of the business environment is Social.
• The related principle of general management is Initiative.

Initiative means taking the first step with self-motivation. The workers should be encouraged to develop and carry out their plans for improvement. Suggestion system should be adopted in the organization.

Question 15: As a result of the decision by Britian to exit to European Union the new trade agreements will come into force from the EU as it accounts for 35-40% of auto component exports from India. Tata Motors owned Britain’s largest carmaker Jaguar Land Rover (JLR) has been in Britain for three decades and makes 4,75,000 cars a year in the country of which most of them are exported inside the European Union and beyond. JLR estimates that their annual profit could be cut by one billion pounds ($1.47 billion) by the year 2020. In the context of the above case:

• Explain why are all the elements of business environment considered to be closely interrelated?
• Name any two related dimensions of the business environment.
• All the elements of business environment are considered to be closely interrelated as any change in one of them may necessitate a series of changes in other dimensions as well.
• The related dimensions of the business environment are Political and Legal.

Question 16: : After competing his education, Arun joins his father in their family business of manufacturing cookware. As a businessman, his father is rigid in his approach and has fixed ideas about various issues. He tends to maintain a distance from the factory workers. However, Arun is more receptive to the needs of the workers and doesn’t seem to believe in any class- differences. He believes that the prosperity of their business greatly depends upon the prosperity of their workers and vice versa. At the same time, he has a good understanding of the business environment. Therefore, he introduces a new range of green pans that provide a healthy cooking surface, as they are manufactured with all ceramic or silicon coating and are considered safer than the traditional petroleum based nonstick surfaces which may contain toxic substances. Although, the new cookware range is highly priced/, he expects a ready market for it as both the purchasing power of people and their preference for better quality products has increased over the years. In the context of the above case:

• Identify the nature of management which is being reflected in the different styles of management in practice adopted by Arun and his father.
• Name and explain the related principle of scientific management.
• State the related dimensions of business environment.
• The different styles of management in practice adopted by Arun and his father reflect that management is an art.
•  ‘Harmony, Not Discord’ is the related principle of scientific management. Taylor emphasised that there should be complete harmony between the management and workers instead of a kind of class-conflict, the mangers versus workers. To achieve this state, Taylor called for complete mental revolution on the part of both management and workers. The prosperity for the employer cannot exist for a long time unless it is accompanied by prosperity for the employees and vice versa. He advocated paternalistic style of management should be in practice.
• Economic Environment: Economic environment comprises of factors that can affect management practices in a business enterprise includes interest rates, inflation rates, changes in disposable income of people, stock market indices and the value of rupee etc.

Question 17: ‘Gallant’ is a well known FMCG (Fast Moving Consumer Goods) company in India. However, for the past few years its profitability is diminishing due to the presence of a new company ‘Prakritik’. ‘Prakritik’ has gradually acquired a reasonable share in a wide variety segments like soaps, shampoos, detergents, dish wash and oral care. One of the key reason is that ‘Prakritik’ has positioned itself as a natural/Ayurvedic brand and this approach has worked well with the Indian consumer. In order to compete with this threat ‘Gallant’ has acquired a premium Ayurvedic brand ‘Madhumita’ from another group. Moreover its likely to increase its advertising budget to counter the threat from ‘Prakritik’. In the context of the above case:

• Identify the related component of the business environment which has contributed effectively towards the success of Prakritik.
• Also, state the two ways in which ‘Gallant’ has responded to the changes in its business environment.
• Social aspect is the related component of the business environment which has contributed effectively towards the success of Prakritik.
• Acquisition

Banknifty Pivot Point comes under business environment if you see in stock market.

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NCERT Solutions for Class 12 Business Studies Chapter 3

NCERT Solutions for Class 12 Business Studies Chapter 3 Business Environment updated for new academic session 2024-25. All the answers of Class 12 B. St. Chapter 3 are given here in simplified format. Use it free of cost without any login.

Class 12 Business Studies Chapter 3 NCERT Solutions

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What do you understand by business environment? It means the sum total of all individuals or institutions and other forces that are outside the control of a business enterprise but they may affect its performance. The economic, social, political, legal and technological forces which operate outside a business enterprise are part of its environment. The individual consumer or competing enterprises as well as the government, consumer enterprising as well as the governments, consumer groups and other institutions working outside an enterprises also constitute its environment. Example- increasing taxes by government, increasing competition in market.

How does understanding of business environment help in improving performance of a business? Understanding of business environment help in improving performance of a business due to various reasons, it helps to identify the various opportunities in the business, it helps in identification of threats or negative signals that affects the business, it helps in accumulation of useful resources for the business, it helps to adapt the change it in the business environment, and it also helps in formulation of new plans and polices and hence all these factors helps in improving the business environment.

Give an example to show that a business firm operates within numerous inter related factors constituting the business environment. (Hint: example highlighting the inter relatedness of dimensions of business environment). Different elements and dimensions of the business environment are interrelated. For example: nowadays people are more focused toward health and fitness. So, people are spending more on organic foods, gyms and food supplements. This is an example of a social environment but it is also related to the economic environment because the disposable income of the people have increased.

Krishna Furnishers Mart started its operations in the year 1954 and emerged as the market leader in the industry because of their original designs and efficiency in operations. They had a steady demand for their products but over the years, they found their market share declining because of new entrants in the field. The firm decided to review their operations and decided that in order to meet the competition. They need to study and analyze the market trends and then design and develop their products accordingly. List any two impacts of changes in business environment on Krishna Furnishers Mart’s operations. (Hint: increase in competition And Market orientation). The impacts of changes in business environment on Krishna Furnishers Mart’s operations are:

• Innovation in design
• Market Orientation

Why it is important for business enterprises to understand their environment? Explain briefly Understanding of business environment is of vital importance for successful functioning of an organization. Any organization cannot function independently. It’s functioning and performance depends on several external forces as well. A continuous evaluation and understanding of the business environment helps a firm to understand these forces in a better manner and thereby improve its functioning. The following points highlight the importance of understanding of environment for business enterprises. 1. Identification of Opportunities and Getting the First Mover Advantage: Opportunities refer to the positive external trends or changes that will help a firm to improve its performance. Environment provides numerous opportunities for business success. Early identification of opportunities helps an enterprise to be the first to exploit them instead of losing them to competitors. 2. Identification of Threats and Early Warning Signals: Threats refer to the external environment trends and changes that will hinder a firm’s performance. Besides positive opportunities, a study of business environment helps an enterprise in the identification of threats or negative signals that may adversely affects its functioning. Thereby, it enables it to take appropriate preventive measures. 3. Accumulating Useful Resources: Environment provides a business various resources or inputs for its functioning such as raw material, machinery, labour, etc. On the other hand, enterprises provide the environment with output in the form of goods and services. That is, environment acts both as a source of resources as well as a source of demand for the products of the enterprises. Thus, it becomes logical for the enterprises to take up those resources from the environment that can be converted into the desired output. This is possible only if the enterprises have an understanding of what the environment desires and what it can offer. 4. Adjusting to Changes: Business environment is dynamic in nature. Changes in technology, consumers taste and preference, government policies take place continuously. A careful analysis and understanding of the environment helps an enterprise in dealing with these changes in a better manner and thereby, take appropriate actions. 5. Formulating Plans and Policies: A continuous study of environment helps an organization in the identification of the opportunities and threats. Thereby, it guides the organization in framing suitable plans and policies in view of the current scenario. 6. Improving Performance: A continuous analysis of the environment helps the enterprises in framing suitable policies and plans and thereby, improves their performance.

Liberalization: It refers to the removal of unnecessary controls and restrictions of the government in the form of licenses, permits, and quotas. India initiated liberalization of industries in 1991. They signalled the end of the license- permit-quota raj. Liberalization of industries in India took the following form:

• License required for the establishment of industries were abolished.
• Enterprises became free in deciding the scale and size of production and the price of the products.
• Restrictions were removed on the movement of goods and services.
• Procedures regarding exports and imports were relaxed.
• Reduction in tax rates and lifting of unnecessary controls over the economy.
• Making it easier to attract foreign capital and technology to India.
• Freedom in fixing the prices of goods services.

National Digital Library of India (NDL India) is a pilot project initiated by the HRD ministry. It works towards developing a framework of virtual repository of learning resources with a single-window search facility. It provides support to all academic levels including researchers, life-long learners and differently-abled learners free of cost. State the dimensions of business environment highlighted above. The dimensions of business environment highlighted in the above case are: 1. Technological Dimension: They improve their technological dimension by developing a framework of virtual repository of learning resources with a single-window search facility. It provides new opportunities to the enterprise. 2. Social Dimension: By providing support to all academic levels including researchers, life-long learners and differently-abled learners free of cost. By doing this it will benefit society and the company’s social esteem also increases.

Privatization: Privatization implies providing greater role to the private sector and reducing the involvement of public sector. Privatization was followed in India in the following manner:

• Disinvestment of the public-sector enterprises.
• Establishing Board of Industrial and Financial Reconstruction for the revival of the sick and loss-making enterprises.
• Diluting the stake of government in the public-sector enterprises.

State the impact of demonetization on interest rates, private wealth and real estate. The impact of demonetization on interest rates, private wealth and real estate are as follow: Interest Rates: 1. There was a decline in cash transactions. 2. The cash deposit in the bank increased. 3. There was also an increase in the financial savings. Private Wealth: Public wealth declined because some high demonetized notes were not returned. Real Estate: The price of the real estate declined.

Globalization: Globalization refers to the process of integration of various economies of the world. It implies reducing the restrictions on the import and export such as licensing and tariffs. In India the following policies were followed with regard to globalization.

• Removal on restriction on imports.
• Abolishing the export duty.
• Reducing import duty.

Briefly discuss the impact of government policy changes on the business and industry. The policies of liberalization, privatization and globalization by the government affect the functioning of the business enterprises. The following points highlight the impact of government Policy changes on the business and industry. 1. Increased Competition: As a result of the policies such as relaxation of the licensing policy and reduction of import duties, the competition faced by the domestic firms increases. Indian companies experienced competition in service industry such as telecommunication, banking, insurance, etc. 2. Increased Demand: As competition increases, the choice of goods and services for the consumers also increases. Thus, consumers also gain from quality products and greater variety. 3. Change in Business Policies: The government policies directly impact the functioning of the business enterprises. As a result, they have to alter their policies appropriately. 4. Technological Changes: As competition increases, firms tend to find new and innovative ways to survive in the market. In such a scenario, technological improvements become imperative. 5. Need for Trained Personnel: Innovations and improvement in product, application of new technologies requires skilled and trained personnel. Thus, there arises a need for the development of human resources. 6. Greater Market Orientation: With increased competition, the production has become market oriented. That is, the enterprises produce as per the market demand. 7. Less Reliance on Budgetary Support by Public Sector Enterprises: To survive the increased competition, the public sector enterprises must improve efficiency and productivity rather than relying on budgetary support to cover their losses. On the whole, the impact of Government policy changes particularly in respect of liberalization, privatization and globalization has been positive. Indian enterprises have developed strategies and adopted business processes and procedures to meet the challenge of competition. They have become more customer-focused and adopted measures to improve customer relationship and satisfaction.

How would you characterize business environment? Explain, with examples, the difference between general and specific environment. Business environment refers to all the external forces such as economic, social, political, technological or legal that affects the performance of a business organization. Business environment has the following characteristics. 1. Aggregate of External Forces: Business environment is the total of all the external forces such as individuals, consumers, government, legal matters that affect the performance of an organization either positively or negatively. 2. Interrelation: Different forces of business environment are closely related to each other. For example, an increase in the income of the consumers increases the demand for consumer durable such as television, refrigerator, etc. 3. Ever Changing: Business environment is dynamic and ever changing in nature. For example, consumer tastes and preferences, technology, government rules and policies keep changing continuously. 4. Uncertainty: Business environment is uncertain. Changes in different forces of the environment cannot be predicted easily. In addition, dynamism of the forces makes it even more uncertain. Complex: Business environment is the aggregate of different interrelated and dynamic forces. Thus, it becomes difficult and complex to understand. For example, all political, social, economic, technological and legal matters affect the performance of organization. While, it may be easy to understand the individual effect of these forces, their cumulative effect is quite difficult to understand. Relative: Business environment is relative in nature. It differs from region to region. For example, political conditions, religious beliefs, government rules and policies differ from one region to another. Specific Environment and General Environment Specific environment refers to those external forces that affect an organization directly. That is, they are the forces that are specific to a particular organization or a company. For example, a change in tastes and preferences of consumers towards the products of a company, directly affects its demand. Similarly, a delay in the supply of raw material from the suppliers directly affects the production of a company. On the other hand, general environment refers to those external forces that affect all the organizations. As against specific forces, general forces do not pertain to a particular organization, rather they affect the performance of all the organizations. Thus, such forces affect a particular organization only indirectly. For example, a change in technology affects the quantity and quality of production of all the organizations. Similarly, a change in political conditions affects all companies simultaneously.

How would you argue that the success of a business enterprise is significantly influenced by its environment? The success of a business enterprise is significantly influenced by its environment. The following points highlight the importance of understanding of environment for business enterprises: 1. Identification of Opportunities and Getting the First Mover Advantage: Opportunities refers to the positive external trends or changes that will help a firm to improve its performance. Environment provides numerous opportunities for business success. Early identification of opportunities helps an enterprise to be the first to exploit them instead of losing them to competitors. 2. Identification of Threats and Early Warning Signals: Threats refer to the external environment trends and changes that will hinder a firm’s performance. Besides positive opportunities, a study of business environment helps an enterprise in the identification of threats or negative signals that may adversely affects its functioning. Thereby, it enables it to take appropriate preventive measures. 3. Accumulating Useful Resources: Environment provides a business various resources or inputs for its functioning such as raw material, machinery, labour, etc. On the other hand, enterprises provide goods and services. Environment acts both as a source of resources as well as a source of demand for the products of the enterprises. Thus, it becomes logical for the enterprises to take up those resources from the environment that can be converted into the desired output. This is possible only if the enterprises have an understanding of what the environment desires and what it can offer. 4. Adjusting to Changes: Business environment is dynamic in nature. Changes in technology, consumers taste and preference, government policies take place continuously. A careful analysis and understanding of the environment helps an enterprise in dealing with these changes in a better manner and thereby, take appropriate actions. 5. Formulating Plans and Policies: A continuous study of environment helps an organization in the identification of the opportunities and threats. Thereby, it guides the organization in framing suitable plans and policies in view of the current scenario. 6. Improving Performance: A continuous analysis of the environment helps the enterprises in framing suitable policies and plans and thereby, improves their performance.

As per Chapter 3 of 12th B. St., is business environment a dynamic concept?

Yes, because the 5 components namely, social environment, political environment, economic environment, legal environment and technological environment keep on changing.

Is Class 12 B. St. Chapter 3 a part of macro-economic study?

Yes, because Macroeconomics deals with the economy as a whole. It is the study of aggregate of all economic unit in the economy.

Can chapter 3 of 12th Business Studies be studied independently of other topics?

Yes, This topic is very important for understanding the economics system as a whole.

Does Class 12 Business Studies chapter 3 have Practical utility?

Yes, It helps to understand the concept of (LPG) and demonetization.

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NCERT Solutions for Class 12 Business Studies Chapter 3: Business Environment; Available for download

Jagran josh brings to you yet another complete ncert solutions for class 12 business studies(part-1), chapter 3. this article also lays down some important topics from the chapter to ensure good marks in upcoming cbse board examinations 2024..

NCERT Solutions for Class 12 Business Studies Chapter 3: This article brings to you complete NCERT Solutions for Class 12 Business Studies Chapter 3, Business Environment. In this article you can also find free PDF download link for full NCERT solutions of the chapter mentioned above. Reading of NCERT chapters can help you understand the concepts of the topics and practically implement them while solving NCERT questions. Practise of NCERT Solutions plays an important role in scoring good marks in CBSE Board Examinations.

• Importance of business environment
• Dimensions of business environment
• Economic environment in India
• Demonetization and Impact of demonetization

Clearing concepts of above-mentioned topics can give you sufficient knowledge about the chapter. These topics are also important from CBSE Board Examination’s point of view.

 CBSE Class 12 Business Studies Revised Syllabus 2023-2024 (PDF)

CBSE Class 12 Business Studies Sample Paper 2023-2024(PDF)

Find NCERT Solutions for Class 12 Business Studies Chapter 3: Business Environment, below.

Very Short Answer Type:

  1.What is meant by business environment?

Answer . The sum total of all forces that are outside of a business’s control but affects its performance is called business environment. These forces are all the institutions, individuals, political, social, economic, technological etc that operate outside your business. It is also quoted as “ Just take the universe, subtract from it the subset that represents the organisation, and the remainder is environment”.

2.How does understanding of business environment help in improving performance of a business?

Answer.  Understanding of business environment can help business adopt suitable business practises and monitor their environment. It teaches them to upgrade and change practises as per new norms which ultimately improves the performance of a business.

3.Give an example to show that a business firm operates within numerous inter related factors constituting the business environment.(Hint: example highlighting the inter relatedness of dimensions of business environment).

Answer.  A business operates under multiple dimensions. For example: if XYZ is a fashion company, its business environment constitutes of social, technological, legal, environmental dimensions. It has to operate within all of these inter related factors.

4.Krishna Furnishers Mart started its operations in the year 1954 and emerged as the market leader in the industry because of their original designs and efficiency in operations. They had a steady demand for their products but over the years, they found their market share declining because of new entrants in the field. The firm decided to review their operations and decided that in order to meet the competition, they need to study and analyze the market trends and then design and develop their products accordingly. List any two impacts of changes in business environment on Krishna Furnishers Mart’s operations. (Hint: increase in competition and Market orientation).

Answer.  Two impacts of changes in business environment on Krishna Furnisher’s Mart Operations are:

a. Increase in competition from existing and new entrants in the industry.

b. Change in market orientation, business policies from time to time.

5.Name any two Specific forces of business environment affecting business.

Answer . Two specific forces of business environment affecting business are:

a. Investors loyalty

b. Strategies of competitors’

Short Answer Type:

1.Why it is important for business enterprises to understand their environment? Explain.

Answer.  It is important for business enterprises to understand their environment because:

a. Identifies opportunity and gets the first mover advantage - Opportunities refer to new trends or changes in an organization’s functioning that improves its performance. Understanding of our  business environment helps business identify such opportunities and stand apart from competition by being the first one to bring the change in the industry. It not only improves performance of the company but also builds trust among the stakeholders. For example: Ola India was the market leader in providing taxi services because it identified the problem of searching for taxi’s in India.

b. Identifies threat and early warning signals - Threat can be change in strategies of competitors, trends that might turn the business upside down, governmental policies, environmental threats etc. Understanding of business environment can help a business be prepared about such environmental disturbances that might affect the business. It acts as early warning signal for companies. For example: if a firm knows that a multinational company is entering your market, it can be termed as a threat, so by using this information you can prepare and adopt strategies to hold your place in the market.

c. Taps useful resources - Understanding of business environment can help you keep an eye on resources available in the environment. A business functions on resources, it is important to find, mine and utilize those resources in the best way possible and it can turn out to be profitable if you identify a resource before your competitors.

d. Helps in coping with changes - Business environment in today’s day and age has turn out to be dynamic and changes at a rapid pace, be it in terms of competitors or customers or trends. Understanding of business environment helps a business to be prepared for these changes and create suitable coping measures accordingly. It’s always better to be aware about changes that are going to affect your business in coming years.

e. Assists in planning and policy formulation - Since business environment is dynamic and changes rapidly, it can act as both opportunity as well as threat. Understanding of you business environment can help you decided your future actions(planning) and prepare guidelines(policy formulation) as necessary.

f. Improves performance - Main purpose of keeping updates about your business environment is because you want to grow, improve your performance and not lag behind then your competitors. Studies have proven that constant monitoring of your environment and advance planning helps your business grow and improves its performance.

2.Explain the following terms:

a. Liberalisation - Liberalisation refers to freeing an enterprise from unnecessary restrictions and controls. Industrial revolution promoted liberalisation of Indian businesses. As a consequence, license-permit-quota raj was abolished. Reforms that changed the nook and corner of Indian Industrial setup are: Abolishment of licensing, Curb on restrictions on expansion or contraction of business activities, Removal of restrictions on movement of goods and services, freedom of deciding the prices of goods and services, reduction in tax rates, simplifying procedures of export and import, easier attraction of foreign technology and ideas to Indian market.

b. Privatization - Economic reforms focused on increasing the entry of private sector in India and less inclusion of public sector in multiple services. This process of shift from public to private sector involvement is called privatization. Inorder to achieve this, government brought in New Industrial Policy of 1991, adopted the policy of disinvestment(transfer from public to private sector) of public sector and decided to refer the loss making firms to the Board of Industrial and Financial Reconstruction. If there is dilution of Government ownership beyond 51 percent, it would result in transfer of ownership and management of the enterprise to the private sector.

c. Globalisation - Integration of multiple economies of the world leading towards the emergence of a cohesive global economy is known as globalisation. Till 1991, Indian government restricted the import of goods by laying down guidelines, putting high tariff rates and putting quantitative restrictions. New reforms focused on indulging India into world market setup. It brought liberalization of trade, rationalisation in tariff structure, ease on import and export of goods and services and much more. Globalisaton brings expansion of markets and customer by making entry into new geographical markets. Economic reform of 1991 was the first step in globalisation of Indian market.

3.National Digital Library of India (NDL India) is a pilot project initiated by the HRD ministry. It works towards developing a framework of virtual repository of learning resources with a single-window search facility. It provides support to all academic levels including researchers, life-long learners and differently-abled learners free of cost. State the dimensions of business environment highlighted above.

Answer.  Dimensions of businesses highlighted above are:

a. Social dimension - Social environment includes values of business, society’s expectation from business, educational value in society and customs. To promote this aspect of business, CSR activities have been included in the corporate world. NDL India tries to create an impact in society by allowing life-long learners, researchers, disabled people to have free access of knowledge. It values the customs and values of society.

b. Technological dimension - Every business is expected to benefit society by introducing new technologies and adapting to existing ones. Here, opening of NDL puts Indian education sector one step ahead in fair inclusion of technology in education. Since, NDL works towards developing a framework of virtual repository of learning resources with a single window search facility, it uses technological dimension of business environment.

  4.State the impact of demonetization on interest rates, private wealth and real estate.

Answer . On 8 th  of November 2016, Indian government announced demonetization of two largest denominations notes i.e Rs 500 and Rs 1000. With immediate effect, there was curb on use of these notes except for payment of utility bills. This made almost 86% of money in circulation invalid. Certain restrictions were imposed on convertibility of domestic money and bank deposits. People of India gathered in long queues outside Indian banks and ATM to convert their money. Main aim of demonetization was to curb corruption, accumulate black money not registered for payment of tax. Demonetization impacted interest rates, private wealth and real estate in following ways:

Interest rates - There was a decline in cash transactions, bank deposits were increased, there was an increase in financial savings

Private wealth - It declined since some high demonetized notes were not returned.

Real Estate - Real estate prices fell.

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Case Studies - Environment | Business Studies (BST) Class 12 - Commerce PDF Download

Q. 1. Mr. Ajay after completing MBA from USA comes to India to start a new business under the banner Ecom Creations Ltd.  He launches a new product in a e-learning for senior Secondary School students in Commerce stream, which already has n established market in UK and USA but not in India.  His business starts flourishing in India.  Now more Indian companies entered into the market with other subjects also.

Identify and quote the lines from above para which highlight the significance of understanding business environment.                                                               (4 marks)

• “Comes to India to start a new business … launches a new product in e-learning for Senior secondary school students in Commerce stream.”
• It helps in assisting in planning and policy formulation.
• It helps the firm to identify opportunities and get the first mover advantage.
• “His business starts flourishing in India.”
• It helps in improving performance.
• “Now more Indian companies entered into the market with different subjects also.”
• It helps the firm to identify threats and early warning signals.

Q. 2. Just after declaration of Lok Sabha Elections 2014 results, the Bombay stock exchange’s price index (Sensex) rose by 1000 points in a day. Identify the environmental factor which led to this rise giving reason.  Also explain any two other dimensions of business environment.                                                                                     (5 marks)

Ans.  Rise in stock market index (Sensex) is economic environment.  But Political environment (declaration of Lok Sabha Elections 2014 results)) led to this rise.

Two other dimensions of business environment:

• Legal Environment:
• Technological environment:

Q. 3. The court passed an order that all schools must have water purifier for the school children as

• Society in general is more concerned about quality of life.
• Innovative techniques are being developed to manufacture water purifier at competitive rates.
• Incomes are rising and children at home are also drinking purified water.

The government is also showing positive attitude towards the water purifier business.

Identify the different dimensions of business environment by quoting from the above details.                                                                                                         (5 marks)

• Legal environment:
• Social environment:
• Economic environment:
• Political environment:

Q. 4. ‘It is common now to see CD-ROM’s, computerized information kiosks, and Internet/Word Wide Web multimedia pages highlighting the virtues of products.’ Name the dimension of the business environment highlighted by this stateme.                       (1 mark)

Ans.  Technological environment

Q. 5. Which component of business environment requires that advertisements of baby food must necessarily inform the potential buyers that mother’s milk is the best?    (1 mark)

Ans.  Legal environment.

Q. 6. It is the process by which government control over the industry is being loosened.  Give the term to which this statement is trying to indicate.                                                (1 mark)

Ans.  Liberalization

Q. 7. Due to entry of foreign firms, competition for Indian firms has increased, especially in service industries.  Name such service industries.                                                           (1 mark)

Ans.  Telecommunications, airlines, banking, insurance, etc.

Q. 8. The Court passed an order to ban polythene bags as

• The bags are creating many environmental problems which affect the life of people in general.

The Government decided to give subsidy to jute industry to promote this business.

Innovative techniques are being developed to manufacture jute bags at low rates.

Incomes are rising and people can afford to buy these bags.

Identify the different dimensions of Business Environment by quoting the lines from the above particulars.                                                                                              (5 marks)

Q. 9. The government of India is seriously thinking of allowing the oil-marketing public sector undertaking to fix their own prices for petrol and diesel.  Which economic reform is the reason for this change in the government’s policy?

Ans.  Privatisation as a reform is the reason for this change in the government policy.

Q. 10. Kapil Sharma is working as the Country Head of a company which owns a chain of malls under the name of ‘Virtuoso’ in the various parts of India.  Through an analysis report of the business environment, it has been brought to his notice that in the coming years, shopping at a mall will not be a necessity for the buyers as purchases can be made online from anywhere and at any time with ease and at the consumer’s convenience.  Hence, malls will have to provide much more than shopping to be able to attract customers.  So, he recommends that ‘Virtuoso’ malls should to be restructured into recreation centres, offering more spaces to socialize, host events and concerts, and provide ample Food and Beverages options.

Consequently the share of entertainment segment and Beverages segment in the overall mall space is increased by 20%.  As a result, the company gains enormously by getting the first mover advantage.

In context of the above case:

• Define the term ‘Business Environment’.
• Explain the terms ‘Threats’ and ‘Opportunities’ by quoting lines from the paragraph.
• The term ‘Business Environment’ means the sum total of all individuals, institutions and other forces that are outside the control of a business enterprise but that may affect its performance.
• The term ‘threats’ refers to the external environment, trends and changes that will hinder a firm’s performance.

“Trough an analysis report of the business environment, it has been brought to his notice that in the coming years, shopping at a mall will not be a necessity for the buyers as purchases can be made online from anywhere and at any time with ease and at the consumer’s convenience.Hence, malls will have to provide much more than shopping to be able to attract customers.”

The term ‘opportunities’ refers to the positive external or changes that will help a firm to improve its performance.

“As a result, the company gains enormously by getting the first mover advantage.”

Q. 11. “Zero Defect Zero Effect” (ZED) is a slogan coined by the Prime Minister of India, Narendra Modi with reference to the Make in India initiative launched by the government.  The slogan reflects the efficiency of production processes, i.e. the products have no defects and the process through which the product is made has zero adverse environmental and ecological effects.  The Zed model aims to make India the manufacturing hub of the world and prevent the products developed in India from being rejected by the global market.  Moreover, before the initiative was launched, the limits of foreign direct investment in various sectors had been relaxed.  The application for licences was made available online and the validity of licences was increased to three years.  Various other norms and procedures were also relaxed by the government.

In the light of the above paragraph, identify and explain the major component of New Economic Policy of 1991 that are being referred to by quoting lines from the paragraph.

Ans.  The major components of New Economic Policy of 1991 that are being referred to are as follows:

• Liberalization: The economic reforms signaled the end of the licence-permit-quota raj and were aimed at liberalizing the Indian business and industry from all unnecessary controls and restrictions.

“Moreover, before the initiative was launched, the limits of foreign direct investment in various sectors has been relaxed.The application for licences was made available online and the validity of licences was increased to three years. Various other norms and procedures were also relaxed by the government.”

• Globalization: Globalization means the integration of the various economies of the world leading towards the emergence of a cohesive global economy.

“The ZED model aims to make India the manufacturing hub of the world and prevent the products developed in India from being rejected by the global market.”

Q. 12. Over the years, e-business in our country has witnessed tremendous growth due to several reasons.  There is significant improvement in the Information Technology infrastructure over the last decade as the Government has taken important steps in high-speed Internet connectivity.  As a result, the broadband networks have not only become better but also more affordable.  Additionally, Government is trying to make rural India connected through broadband – a great possibility for e-business to expand the retail market by reaching out to the most remote rural customer.  Another catalyst strengthening the e-business segment is the country’s favourable demography.  It has more than 50% of its population below the age of 25 and more than 65% below the age of 35.  It is expected that, in the year 2020, the average age of an Indian will be 29 years, compared to 37 for China and 48 for Japan, this promises for phenomenal increase in e-business.  Moreover, the penetration of the smartphone in a large section of the population has aptly addressed the problem of compute illiteracy. Not with standing the fact that consumers also prefer e-business due to multiple factors like convenience, time etc.

Identify and explain the various dimensions of business environment being referred to in the above case.

Ans.  The various dimensions of business environment being referred to in the above case are as follows:

• Political Environment:
• Technological Environment:
• Social Environment:

Q. 13. Beni, after completing her MBA, took up a job a multinational company named ‘Fortio’.  The company was paying good salary and perks to its employees.  The wages were within the paying capacity of the company that provided the employees a reasonable standard of living.  The company also had a good work-culture and the behaviours of superiors was very good towards their subordinates.  Beni was very happy in this organization, but due to long working hours she did not have time to cook her meals.  She had to depend on outside found, which was deteriorating her health.

She observed that this problem was faced by many of her colleagues, not only in her company but also in many other companies.  This was because of increase in the number of working women and non-availability of hygienic home-cooked food.  She identified this as a great opportunity and decided to give up her job to supply packaged home-cooked food to office goers at a reasonable price.  At the end of the day she also distributing the left-over food in the nearby night-shelters.

• State the dimension of business environment being discussed above.
• State the principle of management being followed by ‘Fortio’.
• Identify any two values being communicated by the company to the society in the above case.                                                                                                     (4 marks)
• Social environment which includes social forces like customs and traditions, values trends etc.

‘this was because of increase in the number of working women and non-availability of hygienic home-cooked food.’

• Remuneration of employees, which states that the overall pay and compensation should be fair to both employees and the organization.

‘The company was paying good salary and perks to its employees.The wages were within the paying capacity…standard of living.’

• Values being communicated by the company to the society are:  (Any two)
• Good work culture
• Good behavior inhuman interaction
• Concern for the employees
• Respect for law

Q. 14. Nakul, a manager of Zyco Ltd. always takes into account the changes taking place in business environment while determining plans.  He accepts changes readily and gives useful suggestions to his superior, which results in reduction of costs.  As a result, company’s profits increase.  Nakul enjoys cordial relations with his co-workers and makes plans in consultation with his team to achieve organizational goals.

• Which characteristic of management is highlighted in the above lines?
• Identify and state any two principles of management followed by Zyco Ltd.
• Give any two benefits which Zyco Ltd. get by taking into account the changes taking place in business environment, quoting the lines from the above para.
• State any one value which Nakul wants to communicate to the society.      (6 marks)
• Management is a dynamic function.

This principle indicates that the subordinates should be encouraged to give suggestions and make and execute plans within the prescribed limits of authority.

• Spirit de corps

This principle suggests that management should promote a team spirit of unity and harmony among the employees.

• Benefits of business environment:

‘… takes into account the changes taking place in business environment while determining plans.’

‘He accepts changes readily and gives useful suggestions to his superior, which results in reduction of costs.As a result, company’s profits increase.’

• Adaptability

Q. 15. It is interesting to know that the menu items of the multinational food chains are customized to suit the general palates of the local people in the region.  When McDonald’s started its business in India in the year 1996, the company went through a complete localization strategy.  McDonald’s changed its product menu to accommodate the vegetable burger given the large vegetarian population.  It also altered its store design and even reduced the product price by close to fifteen per cent.  Also, the “McAloo Tikki burger” is not available anywhere but in the Indian outlets of McDonalds.

• Identify the relevant feature of business environment being discussed above.

Ans. Relativity is the relevant feature of business environment which is being discussed above.

Q. 16. Eco-friendly products are gaining power as the consumers’ awareness about environmental issues has increased over the years and they are conscious about choosing products that do not have adverse effects on the environment.  They are now more conscious about the carbon emission and climate change effects, and want themselves to be ‘seen’ as a green advocate among their peers.  In such a scenario, it has become a challenge for the companies as they have to not only meet the needs of the consumers but also ensure that their products are safe and environment friendly.  At a result, there is growing need for better and advanced technologies to works as a catalyst in this regard.

• Describe briefly any three points which highlight the importance of business environment and its understanding by managers.
• Inter-relatedness is the relevant feature of business environment which is being discussed above.
• The three points which highlighted the importance of business environment and its understanding by managers are described below:
• It enables the firm to identify opportunities and getting the first mover advantage: The dynamic business environment provides numerous opportunities for a business to evolve as per the changing needs.  Therefore, early identification of the forthcoming opportunities helps an enterprise to be the first to exploit them instead of losing them to the competitors.
• It helps the firm to identify threats and early warning signals: sometimes the changes in the external environment may pose as a threat and hinder a firm’s performance.  An awareness about the business environment helps the managers to identify such threats on time and take necessary decisions and action.
• It helps in tapping useful resources as the enterprise designs policies that allow it to get the resources that it needs so that it can convert those resources into outputs that the environment desires.

Q. 17. Ultra Paint Co. which is manufacturing paints has been enjoying a prominent market position as it manufactured best quality paints, made timely payment of taxes to government. It assembled various inputs like finance, machines, raw materials, etc. from its environment.  But since last year it has been dumping its untreated poisonous waste on the river bank which has created many health problems for the people.  As a result, the court passed an order to seal the manufacturing unit of the company.

• State the importance of business environment highlighted quoting the line from the above case.
• Identify any two dimensions of business environment mentioned in the above case by quoting lines from it.
• State any two values which have been overlooked by the company?

Ans.     (a) Business environment helps in tapping useful resources.

‘It assembled various inputs like finance, machines, raw materials, etc. from its environment.’

(b) (i) Social environment

‘…it has been dumping its untreated poisonous waste on the river bank which has created many health problems for the people.’

(ii) Legal environment

‘…the court passed an order to seal the manufacturing unit of the company.’

• Value overlooked.
• Environment protection
• Concern for human life
• Respect for law and order
• Social responsibility

Q. 18. Philips, a company manufacturing light bulbs incurred heavy expenditure on scientific Research and Development and discovered a technology that made it possible to produce an energy efficient light bulb that lasts at least twenty times as long as a standard bulb.  It resulted in growth and profitability of the company.

• Identify and state the dimension of business environment mentioned above.
• State the importance of business environment mentioned above by quoting the lines.
• State any one value which the company wants to communicate to the society.
• Technological environment                                                                                                                                                            It includes forces relating to scientific improvements and innovations which provide new ways of producing goods and services, and new methods and techniques of operating a business.
• Business environment helps a firm to improve its performance.                                                                                                         ‘It resulted in growth and profitability of the company.’
• Value conservation of energy

Q. 19. Disco Ltd. manufactures fashionable and designer clothes.  Recently it finds that the demand for its products has been declining.  After market research it was discovered that fashion and tastes of the consumers is changing at a fast pace.  Customers’ demand is increasing.  New competitors have entered the market with new designs.  It is very difficult for the company to predict future happenings. Also, it is difficult to know the extent of the relative impact of the social, economic, political, technological or legal factors on decrease in demand of its products in the market.

A meeting was held in which managers from different functional levels heading Production, Marketing, Finance, etc., for example, Chief Operating Officer, Chief Finance Officer, Vice President (Marketing) were present to discuss how to deal with the situation.  After a long discussion, it was decided that they would study and analyze the market first to identify customer tastes and fashion and then manufacture garments accordingly.  It was also decided to increase expenditure on advertising, after-sales services, etc.

• Identify any two features of business environment by quoting the lines from the above case.
• At which level of management the meeting of managers of Disco Ltd. was held?
• Identify any two impact of government policy changes on business, quoting lines from the above case.
• State the importance of understanding of environment by business managers in the light of the above para.                                                                                    (6 Marks)
• Features of business environment:
• Dynamic nature: ‘fashion and taste of the consumers is changing at a fast pace.’
• Uncertainty:  ‘It is very difficult for the company to predict future happening.’
• Complexity: ‘It is difficult to know the extent of the relative impact of the social, economic, political, technological or legal factors on decrease in demand of its products in the market.
• Top level management
• Impact of government policy changes on business:
• Increasing competition: ‘New competitors have entered the market with new designs.’
• More demanding customers: ‘Customers’ demand is increasing.’
• Market orientation: ‘it was decided that they would study and analyze the market first to identify customer tastes and fashion and then manufacture garments accordingly.  It was also decided to increase expenditure on advertising, after-sales services, etc.’
• Business environment helps the manager in coping with rapid changes.

Q. 20.  The organic food market in India is grow at 25-30 per cent which reflects a clear shift in consumer tastes and preferences.  The current growth in the organic food market is driven by multiplicity of factors like rising health consciousness, changing lifestyles, increase in disposable income and growing availability of organic food products in shopping malls, retail outlets and online.

• Identify and explain the features of business environment being referred to here.
• By quoting phrases from the paragraph identify the various components of general forces which have led to a growth in the organic food market.
• The features of business environment being referred to in the above case are as follows:
• Dynamic nature:  It is dynamic in nature and keeps on changing due to technological up gradations, shifts in consumer preferences or increase in competition in the market.
• Inter-relatedness: All the elements of business environment are closely interrelated.  Therefore, any change is one element may necessitate corresponding changes in the other elements as well.

     2. The various components of general forces which have led to a growth in the organic food market are as follows:

• Social:  “rising health consciousness, changing lifestyles”
• Economic: “increase in disposable income”
• Technological: “growing availability of organic food products in shopping malls, retail outlets and on line.”

Q. 21. Anurag, aspires to work with a socially and environmentally committed company as he does not want to work just for monetary benefits but also the brand value of the company he works for in the society matters a lot to him.  Therefore, he has joined Cerebra Integrated Technologies a Bengaluru-based Infotech company.  The company has built India’s largest e-waste recycling plant.  The company strives to be one of the leading players in this business which has huge potential not only in terms of generating huge revenues and profits but also wants to contribute to the environment issues that have become crucial worldwide.  The company sees big business in the mountains of e-waste in Bengaluru which produces 2,00,000 tonnes of e-waste a year.  The company plans to make its millions by extracting metals such as gold and platinum from the e-waste piling up in the city.  As a mobile phone, for example, is made up of a combination of rare earth and precious metals: it contains 250 mg of silver, 24 mg of gold and nine mg of palladium while a laptop has 1,000 mg of silver, 220 mg of gold and 500 grams of copper.

To start the business, the company has obtained a licence from KSPCB (Karnataka State Pollution Control Board).

• Identify the various dimensions of business environment being referred to by quoting lines form the paragraph.
• List any two values which the company wants to convey to the society.
• The various dimensions of business environment being referred to the in the above case are as follows:
• Technological environment:  Technological environment includes forces relating to scientific improvements and innovations which provide new ways of producing goods and services and new methods and techniques of operating a business.
• Legal environment: Legal environment includes various legislations passed by the Government administrative orders issued by government authorities, court judgments as well as the decisions rendered by various commissions and agencies at every level of the government – centre, state or local.
• Social Environment: Social environment includes the social forces like customs and traditions, values, social trends, society’s expectations from business, etc.
• The two values which the Cerebra Integrated Technologies wants to convey through this initiative are:
• Sustainable development
• Concern for environment.

Q. 22. After competing his education, Arun joins his father in their family business of manufacturing cookware.  As a businessman, his father is rigid in his approach and has fixed ideas about various issues.  He tends to maintain a distance from the factory workers. 

However, Arun is more receptive to the needs of the workers and doesn’t seem to believe in any class-differences.  He believes that the prosperity of their business greatly depends upon the prosperity of their workers and vice versa.  At the same time, he has a good understanding of the business environment.  Therefore, he introduces a new range of green pans that provide a healthy cooking surface, as they are manufactured with all ceramic or silicon coating and are considered safer than the traditional petroleum based nonstick surfaces which may contain toxic substances.  Although, the new cookware range is highly prices, he expects a ready market for it as both the purchasing power of people and their preference for better quality products has increased over the years.

• Identify the nature of management which is being reflected in the different styles of management in practice adopted by Arun and his father.
• Name and explain the related principle of scientific management.
• State the related dimensions of business environment.
• The different styles of management in practice adopted by Arun and his father reflect that management is an art.
• ‘Harmony, Not Discord’ is the related principle of scientific management.
• The related dimensions of the business environment are:
• Economic Environment:

Q. 23. Continuous and comprehensive evaluation is a process of assessment, mandated by the right to Education Act, of India.  This approach to assessment has been introduced by state governments in India, as well as by the Central Board of Secondary Education in India.  With the introduction of (CCE) system in education there is greater focus on project based learning.  As a result, besides time and effort the students are willing to invest money to enhance the visual appeal of their project files so as to score higher marks.  In order to cash on the opportunity Rishabh has started a small business unit to manufacture different kinds of decorative materials for the project files.  He has employed a team of four creative designers for developing the innovative material with the help of latest technology.  However, he has a prejudice against women and therefore pays less salary to them as compared to the male staff for equal work.

In the context of the above case:

• Name any two functions of management that Rishabh will have to perform in order to manage his business successfully.
• Name and explain the principle of management which is being violated by Rishabh.
• Identify the related dimensions of the business environment.
• The two functions of management that Rishabh will have to perform in order to manage his business successfully are Planning and Orgnising.
• The principle of management which is being violated by Rishabh is Equity.
• Legal Environment

Political Environment

• Economic Environment
• Social Environment
• Technological Environment

Q. 24. Government of India is seriously thinking to allow oil marketing public sector, undertaking to fix their own price for petrol and diesel.

• Name the economic reform related to this decision of government.
• Name other two reforms recommended in new economic policy.
• Liberalization
• Other two reforms:  Privatization and Globalization.

Q. 25. Recently many companies have planned for significant investment in organizes retailing in India.  Various factors which have encouraged companies to take these decisions are customer income is increasing, rise in standard of living of people.  People are ready to pay high price for quality goods, government policy of liberalization regarding MNC entry and FDI, etc.

• Explain briefly changes in business environment under different heads that have facilitated the companies’ decision to plan significant investment in retailing.
• What has been the impact of these changes with regards to globalization and privatization?
• Explain recent changes in various environment heads, i.e., economic, social, political, legal and technological.
• Explain the topic, impact of change in government policy/economic policy.

Q. 26. Two big banner movies were scheduled to be released on the same date.  On the last movement release of one of the movies has to be postponed due to opposition of a group of people due to some unethical contents related to their religion was shown in the that movie.  The other movie released on time and made huge profit as there was no competition and movie which was postponed suffered loss.

• Which feature of business environment is highlighted here.
• Identify the dimension of business environment, which delayed the release of movie.
• Feature highlighted in ………’relativity’.
• The dimension is ……..’social environment’.

Q. 27. After winning the election, Prime Minister Mr. Narender Modi launched a Campaign of ‘Swachh Brarat’ and invited various celebrities to be a part of this Abhiyaan.  This spread awareness among the people in society and in general, people started becoming more careful and aware about the cleanliness around their area.  To continue its impact, a new service tax for Swachh Bharat was also started.  The government is planning to import new and better technology to adopt new methods of treating the garbage and waste.

State the various dimension of business environment mentioned in the above para quoting the lines from the above para.

• “After wining election ….. campaign of Swachh Bharat.”
• “People in society ….. around their area.”
• “A new service tax ….. started.”
• “Import new technology …. Garbage.”

Q. 28. Even after opening up of Indian Economy, foreign companies found it extremely difficult to cut through the bureaucratic and red tapism in government offices.  This discourages them from investing in India.

Identify the dimension of environment mention in above para.

Ans.  Political Environment.

Q. 29. Just after the declaration of Lok Sabha Elections in 2014, the Bombay Stock Exchange Index rose by 1000 points.

Identify the dimension of business environment.

Q. 30. ‘Mamta Rice Food Ltd’ is a well know rice producing company.  The sales have been falling down from the beginning of the year.  The managing director MR. Bhuvan is worried about this situation.  With a view to find out the solution of this problem he made a team to find but the reasons for downfall of sales.  The team conducted the survey and gave following four reasons for the downfall of company’s sale.

• On account of increase in export duty made by the government, the foreign demand has gone down.
• Due to availability of other eatable substitute the taste of people is diverted from rice.
• The competitor’s imported new technology machine and are producing better quality rice.
• Due to strain with neighbouring country’s government and our country’s government export is effected.

Identify the dimension of Business Environment discussed in the above case.

• Political Environment.

Q. 31. With changes in the consumption habits of people, Neelesh, who was running a sweet shop, shifted to the chocolate business.  On the eve of Diwali, he offered chocolates in attractive packages at reasonable prices.  He anticipated huge demand and created a website chocolove.com for taking orders online.  He got a lot of orders online and earned huge profits by selling the chocolate.

Identify and explain the dimensions of business environment discussed in the above case.

Ans.  The various dimensions of business environment being referred to in the above cased are as follows:

Q. 32. A recent rate cut in the interest on loans announced by the banks encouraged Amit, a science student of Progressive School, to take a loan from State Bank of India to experiment and develop cars to be powered by fuel produced form garbage.  He developed such a car and exhibited it in the Science Fair organized by the Directorate of Education.  He was awarded the first prize for his invention.

Q. 33. ‘Accent electronics Ltd.’ was operating its business in Malaysia.  The company started exporting its products to India when the Prime Minister announced relaxation in import duties on electronic items.  The company appointed retailers in India who had direct online links with the suppliers to replenish stocks when needed.

Q. 34. As per the directions issued by the Supreme Court, the government passed an order to ban the sale of tobacco products within the area of 200 meters of all educational institutions as:

• Its consumptions injurious to health.
• People are becoming more conscious about health and fitness.  This indicates the government’s attitude towards this business.

Identify the business environment under three different dimensions by quoting from above paragraph.

Ans.  The various dimensions of business environment being referred to the in the above case are as follows:

• Legal Environment: ”As per the directions issued by the Supreme Court.’
• Political Environment: “The government passed an order to ban the sale of tobacco products within the area of 200 meters of all educational institutions.”
• Social Environment: “Its consumption is injurious to health and people are becoming more conscious about health and fitness.”

Q. 35. Make in India is an initiative launched by the Government of India to encourage national and multinational companies to manufacture their products in India.  It focuses on job creation and skill enhancement and is in twenty five sectors of the economy.  Under the initiative, brochures on these sectors and a web portal were released.  The initiative aims at high quality standards and minimizing the impact on the environment.  It also seeks to attract foreign capital investment in India.

• Identify the various dimensions of business environment being referred to by quoting lines from the paragraph.
• List any two values which the Government of India wants to convey through this initiative.
• The various dimensions of business environment being referred to in the above case are as follows:
• The two values which the Government of India wants to convey through this initiative are:
• High quality standards
• Concern for environment

Q. 36. India’s retail sector has been undergoing structural changes for the last two decades.  On one hand, the ‘mall culture’ has gradually become a way of life, especially in the metros and mini-metros.  On the other hand, there is accelerated growth in e-business as customers also prefer to buy products and services via the Interest, telephone and television.  However, operating in either of the segments is marked by the presence of strong competitors.

Identify the components of specific forces and general forces being discussed in the above paragraph.

Ans.  The components of specific forces discussed in the above paragraph are the customers and competitors.

The components of general forces discussed in the above paragraph is the social and technological conditions.

Q. 37. To mark the celebrations of International Family Day on 16 th may 2016, Kurkure flagged off India’s first family food train – Kurkure Family Express at New Delhi.  The train took forty families ona fun culinary experience of a lifetime through an eight-day journey across fourteen states in India.  A whole lot of fun activities were hosted on the train by the travel and food anchors Rocky and mayor.

The families were selected through an online campaign, ‘Chatpata family photos’.  The contest attracted approximately 1,000 entries, of which 40 entries that gelled with the brand’s image were selected.

The core idea of the campaign was to bring families from across India together over a journey like this.  As in today’s time, everyone is busy with their life the family members may feel disconnected with each other.

Identify and explain the various dimensions of business environment being referred to the in the above case by quoting lines from the paragraph.

Q. 38. In the year 2016,the State Government of Kerala had made it mandatory for anganwadis hostels and canteens in educational institutions to secure the Food Safety and standards Authority of India (FSSAI) licence to ensure food safety.  As the educational institutions also get categorized as food business operators in the event of the annual turnover of the hostels, they run exceeding Rs. 12 lakh per annum.

• Identify and explain the various dimensions of business environment being referred to here.
• List any two values which the State Government of Kerala wants to convey through this initiative.
• The two values which the State Government of Kerala wants to convey through this initiative are:
• Good health

Q. 39. Postage stamps have been unveiled to commemorate 140 years of existence of the country’s first stock exchange the Bombay Stock Exchange (BSE).  The setting up of BSE is considered to be the greatest revolution that took place in the financial markets in India as it acts as a key driver for economic growth of a country.  This is due to the fact that there exists a strong correlation between economic growth and capital accumulation.

• Identify the dimension of business environment of India being referred here.
• State any three factors which broadly affected the dimension of business environment of India as identified in part (a) of the question.
• Economic environment is the dimension of business environment of India being referred here.
• The three factors which broadly affect the economic environment of India are stated below;
• Stage of economic development of the country.
• The economic structure in the form of mixed economy which recognizes the role of both public and private sectors.
• Economic planning, including five year plans, annual budgets, and so on

Q. 40. In May 2016, the government had launched a web-based application that will provide as opportunity to all the industries dealing in hazardous waste to apply online and get online permissions for import and export of certain categories of waste, which is for reuse, recycling or recovery while it will also help authorities in web-based processing, generation and grant of various types of permissions to the entrepreneurs and industries.  It is also aimed at implementing the concept of paperless and green office and provide information regarding number authorizations or consent order granted by the State Pollution control Boards (SPCBs).

Identify the various dimensions of business environment being referred in the above case.

Q. 41. Bharat is running an ice cream parlour in a local market.  Keeping in mind the changing perceptions about health among the people, one of his employee Abhiraj suggests to him that they should introduce a range a flavoured yogurt.  Bharat accepts his suggestion as a result both the image and the profitability of his business increases.

 In the context of the above case:

• Identify the feature of management which is being highlighted.
• State the related dimension of the business environment.
• Name and explain the related principle of general management.
• The feature of management which is being highlighted is Dynamic.
• The related dimension of the business environment is Social.
• The related principle of general management is Initiative.

Initiative means taking the first step with self-motivation.  The workers should be encouraged to develop and carry out their plans for improvement.  Suggestion system should be adopted in the organization.

Go through this course of Business Studies (BST) Class 12  and get Chapterwise Case Studies  here . 

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Class 12 Business Studies Case Study Questions

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In this article, we will discuss how to get CBSE class 12 Business Studies Case Study Questions from the myCBSEguide App and our Student Dashboard for free.

For the students appearing for class 12 board exams from the Commerce Stream, Business Studies is a core subject. Business Studies as a subject provides a way of perceiving and interacting with the business ecosystem . It well establishes the interdependence of business on various social, political, legal and economic forces and vice-versa. Business Studies is a purely theoretical and a relevantly easier subject for the Commerce students. Business Studies class 12 exam is a highly scoring subject and it facilitates the students to increase their percentile and excel in academics.

12 Business Studies Paper Design

The exam is divided into 2 parts:

• Part A generally contains questions from Principles and Functions of Management and carries 60 marks.
• Part B comprises questions from Business Finance and Marketing, it carries a total of 40 marks.

The syllabus of class 12 Business Studies comprises 12 chapters that are divided into 2 books

• Principles and Functions of Management
• Business Finance and Marketing

Business Studies Syllabus

CBSE has released the latest class 12 syllabus (2022-23) for Business Studies. 

Business Studies Case Study Questions

Case-based questions have always been an integral part of Business Studies class 12 question papers for the past many years. Students are required to focus more on case studies as they require the application of their knowledge of the key business concepts. In the year 2021-22 CBSE introduced a few changes in the question paper pattern to enhance and develop analytical and reasoning skills among students. Sanyam Bhardwaj, controller of examinations, CBSE quoted that case-based questions would be based on real-life situations encountered by the students.

The purpose was to drift from rote learning to competency and situation-based learning. He emphasized the fact that it was the need of the hour to move away from the old system and formulate new policies to enhance the critical reasoning skills of students. Introducing case study questions was a step toward achieving the goals of the National Education Policy (NEP) 2020.

What is a case study question? (Business Studies)

A case study in reference to Business Studies can be thought of as a real-world test of how the implementation works. It is predominantly a report of an organization’s implementation of something such as a practice, a product, a system, or a service. Case studies based on NCERT text form a substantial part of the Business Studies examination. Initially, they were confusing for both students and teachers but now there is a clarity that has made the question paper more student-friendly. A significant weightage has been given to case-based and application-based questions.

Critical and Analytical Thinking

These questions demand critical and analytical thinking on behalf of the students. The best part of these questions is that they provide conceptual hints and keys that point to the right answer. According to the new pattern implemented by CBSE, case-based questions would carry a significant weightage of more than 30% in the Business Studies question paper.

Case Study Passage

As part of these questions, the students would be provided with a comprehensive passage, based on which analytical questions will have to be answered by them. The students would be required to read the passage carefully before attempting the questions. In the coming examination cycle (2022-23), case-based questions have a weightage of around 30%.

Types of Case Study questions in Business Studies

CBSE plans to increase the weightage of such questions in the following years, so as to enhance the intellectual and analytical abilities of the students. Case study questions would be based on various topics and chapters in Business Studies. It is expected from the students to have complete knowledge of the concepts in their syllabus.

They will have to let go of the shortcut techniques and get to read their textbooks with full concentration, especially for solving case-based questions in Business Studies for the passages given are generally lengthy and require an in-depth study. The best part of having these questions is that the question itself projects a hint of its solution.

The questions asked could be :

• Direct and simple-such questions can easily be solved as the answers are either there in the given passage or the student can solve it at ease by reading and analyzing the passage carefully.
• Indirect and application-based- These are the ones that would require the student to have complete knowledge of the topic and could be answered by application of the concepts. The answers to such questions are slightly tricky and not visible in the given passage, though the passage would highlight the concept on which the questions would be asked by CBSE.

Class 12 Business Studies Case Study

Case study questions asked by CBSE were stated to be quite challenging by many students. It prominently focuses on real and present scenarios of the business world. Though the exam, on the whole, was quite direct and its difficulty level was termed out to be moderate. Around 30% of the question paper consisted of case-based questions that required high-order thinking and analytical skills from the students.

Content of Case Study Questions

The concept of case-based questions is not new since CBSE has always included questions based on Higher Order Thinking Skills (HOTs) and case-based questions. Though now we will have an increased percentage of such questions in the question paper. The student has to keep in mind that the concept-based questions can be attempted only with the proper understanding of the business concepts.

Benefits Of Case-based Questions

Class 12 Business Studies syllabus comprises two books and CBSE can ask Case study questions from any of them. Students must prepare themselves thoroughly for both the books. They must practice class 12 Business Studies case-based questions from the various options available to them.

• Enhance the intellectual capabilities of the students.
• Provide a complete and deeper understanding of the subject.
• Inculcate analytical reasoning and temperament in students.
• Help students retain knowledge for longer periods of time.
• Would definitely help to discard the concept of rote learning and cramming without understanding the core of the subject.
• The questions would facilitate bringing out the much-awaited change in the prevalent system of education in India that hinders the strengthening of practical learning.

Some Case-Study Questions (Business Studies) Class 12

Here are some case study questions for CBSE class 12 Business Studies. If you wish to get more case study questions and other related study material, download the myCBSEguide App now. You can also access it through our Student Dashboard .

Business Studies Case Study 1

Read the following text and answer the questions: ABLEX Ltd. is a big and well-reputed company. The biggest challenge for the company is managing many employees at the same time. As the company has various departments like human resources, marketing, finance,etc., it is very necessary for the company to maintain unity in different departments. All the employees work hard for the organisation. Despite their different interest, they all perform various activities together so as to achieve the objectives of the company. The career of employees is shown a developmental path through proper training modules and job enrichment. Ajay is a manager who assigns all duties and responsibilities to his employees in the department. He uses all sources to develop proper communication with them and leaves no attempt to motivate them.

• It integrates Group Efforts
• It is a Continuous process
• It ensures Unity of Action
• It is Pervasive
• Top Level Management
• Middle-Level Management
• Lower Level Management
• Supervisory Level Management
• Economic objectives
• Social Objectives
• Organisational Objectives
• Personal Objectives

Answer Key:

• (c) It ensures unity of action
• (b) Middle-level management
• (c) Personal objectives
• (a) Directing

Business Studies Case Study 2

Read the following text and answer the question: Mohan works in a bulb manufacturing company. Each bulb that is manufactured is of standard size and quality. Further, if there is any unrequited type of bulb manufactured then its production is stopped. Last month when the company came to know that 10-watt bulbs were no more liked by customers, their production was stopped. He works in the purchasing department. His job is to purchase the filaments required to make bulbs. This time when he purchases the filament he gets the instruction from the seller that some special care needs to be taken in the first hour of fixing the filaments inside the bulb. Mohan knows this information should be given immediately to the production department before the assembling process starts. However, he finds that his company’s policies only allow him to give the message to his immediate boss who will further pass this message to his boss. The passing of this message will continue until it reaches the desired person in the production department. Based on the passage answer the following questions:

• Method study
• Fatigue study
• Standardization and simplification
• None of these
• Scalar chain
• Departmentalization
• Division of Work
• None of the above
• Organization
• Authority and Responsibility
• All of these
• Division of work
• Scalar Chain
• (b) Fatigue study
• (a) Scalar chain
• (c) Gang plank
• (a) Division of work

Business Studies Case Study 3

Read the following passage carefully and answer the questions that follow: Two years ago Radhika completed her degree in food technology. She worked for some time in a company manufacturing chutneys, pickles and murabbas. She was not happy in the company and decided to have her own organic food processing unit for the same. She set the objectives and the targets and formulated an action plan to achieve the same. One of her objectives was to earn 10% profit on the amount invested in the first year. It was decided that raw materials like fruits, vegetables, spices, etc. will be purchased on three months’ credit form farmers cultivating organic crops only. She also decided to follow the steps required for the marketing of the products through her own outlets. She appointed Rakesh as a production manager who decides the exact manner in which the production activities are to be carried out. Rakesh also prepared a statement showing the number of workers that will be required in the factory throughout the year. Radhika informed Mohan about her sales target for different products, area wise for the forthcoming quarter. While working on the production table a penalty of 100 per day for not wearing the caps, gloves and apron was announced.

• Standing Plan
• (a) Objectives
• (c) Procedure
• (b) Programme

Tips to Solve Case Study Questions in Business Studies

Let’s try to comprehend and solve case study questions of class 12 Business Studies. As mentioned earlier, the entire syllabus is divided into 2 books. It is expected from the students to rigorously follow the NCERT book as the language written is quite simple and crisp. The exam in spite of being totally theoretical is quite scoring.

• Read the passage in depth.
• Try to comprehend the situation and focus on the questions asked.
• Generally, the passage given in Business Studies is lengthy but the solutions are brief and simple.
• Can follow a reversal pattern, i.e read the questions before and then search for the answers. You will save time.
• Answer briefly and precisely.
• Focus on solidifying key Business Studies fundamentals for acing any case study. If your concepts are clear, you will hardly face any difficulty in answering them.
• While answering the case study, pick the keywords or any keyline based on which you are withdrawing your conclusion. You need to highlight the reason for your answer.

These simple points if kept in mind will definitely help the student to fetch good marks in case study-based questions in class 12 Business Studies.

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CBSE Class 12 Important Questions for Business Studies Chapter 3: Business Environment

• Class 12 Important Question
• Business Studies
• Chapter 3: Business Environment

CBSE Class 12 Business Studies Chapter-3 Important Questions - Free PDF Download

Key Questions and Answers for CBSE Class 12 Business Studies Chapter 3 - Business Environment, produced by qualified Business Studies teachers from the most recent editions of CBSE (NCERT) books, are available for free PDF download. Join for online tutoring at Vedantu.com to improve your CBSE board test score.

Important Topics in Class 12 Business Studies Chapter 3

The main topics covered in this chapter are listed below.

Meaning of a Business Environment

Features of a Business Environment

Importance of a Business Environment

Dimensions of a Business Environment

Impact of Changes in Government Policy on Business and Industry

Related Chapters

Study Important Questions for Class 12 Business Studies Chapter 3 - Business Environment

Very Short Answer Questions (1 or 2 Marks)

1. What is Business Environment? 

Ans: Business environment refers to all the factors that are outside the control of the business enterprise but may equally affect the performance of the business. The social, political, economic, technological factors that operate outside a business forms a part of the business environment.

2. Which of the sectors was given importance after independence? 

Ans: After independence, the private sector was given more importance than the public sector. The role of the public sector slowly declined after independence and the private sector was given a leading role.

3. How have customers benefited by increased competition after liberalization and globalization? 

Ans: Globalization and liberalization had caused amplified competition in the market, which benefited the customers as they got a better quality and broader choice of goods and services while making a purchase. 

4. What do you mean by Liberalization? 

Ans: It is a reform which was introduced to remove unnecessary controls, licensing and government restrictions in an economy. It provides a greater autonomy to the business enterprises in decision-making and removes government interference.

5. How can the firms cope up with changing technological environment? 

Ans: In order to cope with the shifting technological environment a firm must remain conscious about the current changes in the technological field. Thereafter they must acclimate to such change to gain the benefit of new technology. Hence, they need to keep innovating and finding new ways so as to cope with the changing technological environment.

6. What is meant by opportunities? 

Ans Opportunity refers to the positive exterior trends that have the potential to add value to an enterprise. 

7. What do you mean by Globalization? 

Ans: Globalization is the word used to define the increasing interdependence of the world's economies, cultures, and populations, brought about by cross-border trade in goods and services, technology, and flows of investment, people, and data. Hence, Globalisation means to open ways for the various economies of the world to participate in the making of a global economy. 

8. Which policy of the Indian Government has moved India towards globalization? 

Ans: The Industrial Policy of 1991 . 

9. What do you mean by Innovation? 

Ans: The actions required to create new ideas, procedures or products which when executed lead to a positive effective change is known as innovation. Innovation involves the practical application of an inventive act.

10. Name the economic reforms introduced to free Indian business from unnecessary controls and restrictions. 

Ans: Liberalization under the new economic policy of 1991 was introduced to free Indian business from unnecessary controls and restrictions. 

11. What do you mean by disinvestment? 

Ans: It   means to transfer the ownership from the public sector to the private sector. It is an action taken by the government for privatization. In this the government’s stake is diluted in a public enterprise.

12. Give one measure taken by Indian Government to introduce liberalization. 

Ans: Under liberalisation, the requirement of licensing was abolished except for five industries

liquor, 

cigarette, 

defense equipment, 

industrial explosives, and 

dangerous chemicals.

Short Answer Questions (3 or 4 Marks)

13. Explain how does the understanding of business environment help the management in the following: 

A. Tapping useful resources; and

Ans: Business utilizes the resources of the external environment as inputs like finance, labour etc., and supplies its output to the environment in the form of goods and services etc. Also, understanding of the business environment helps the firm to track the useful resources available in the environment and convert them into goods and services.

B. Coping with rapid changes.

Ans: The business environment is extremely dynamic so the managers need to develop strategies not only to cope with the changes but also to use them as their strengths to improve their market shares. In order to proficiently cope with the changes, managers must understand the environment and should adopt suitable courses of action at the right time. It helps management in becoming more aware about the shifting needs of customers. As a result, they are able to respond to such changes efficiently.

14. An environmental conscious multinational company "AXN Ltd." follows certain well defined business principles that result in minimizing employee turnover. Following are some of the important environmental factors followed by 'AXN Ltd.' 

Honour  the law of every country in which it operates. 

Respect the culture and customs of all nations. 

Provide clean and safe products to enhance the quality of life throughout the world

Develop a culture in the company that enhances individual creativity and teamwork while honouring mutual trust and respect between management and labour. 

 From the above: 

i)  Identify and state any one general principle of management and any one dimension  of the business environment.

Ans:   Principle of management :  Esprit de corps . 

As the culture of the company focuses on the developing and honouring of mutual trust and respect between management and labour, this is the principle followed by the company. Another principles can be the principle of initiative and stability of personnel.

Dimension of business environment: Legal environment :

It includes all the legislations passed, administrative orders issued, court judgements or decisions taken by government or its related offices. 

As in the case, it is stated that the firm was very particular about honouring the law of each country in which it operates. Other dimensions can be social and cultural environment, ecological environment.

ii) Values being conveyed: 

Respect for law

Cleanliness and hygiene

Concern for society and employees 

15. ‘Accent Electronics Ltd.’ was operating its business in Malaysia. The company started exporting its products to India when the Prime Minister announced relaxation in import duties on electronic items. The company appointed retailers in India who had direct on-line links to the suppliers to replenish stocks when needed. 

Identify and explain the dimensions of the business environment discussed in the above case. 

Ans: The dimensions of the business environment discussed in the above case are as follows. 

Political Environment: It includes political factors such as political leadership, political stability, practices of the ruling party, policies of the government etc. For example, change in government, or unstable government.

Quotation: “ Prime Minister allowed relaxation in import duties on electronic items”

Technological Environment: It consists of forces relating to scientific improvements and innovations, which lead to better production techniques and methods to produce goods. For example, shift from books to e-books, telephones to touch screen mobile phones. 

Quotation: “The company appointed retailers in India who had direct on-line links to the suppliers to replenish stocks when needed”

16. With change in the consumption habits of people, Neelesh, who was running a sweets shop, shifted to the chocolate business. On the eve of Diwali he offered chocolates in attractive packages at reasonable prices. He anticipated huge demand and created a website chocolove.com for taking orders online. He got a lot of orders online and earned huge profit by selling chocolates. 

Identify and explain the dimensions of business environment discussed in the above case. 

Ans: The dimensions of the business environment that have been discussed here are as follows. 

Social Environment: Social environment represents the customs and traditions, values, culture, social trends, beliefs, ethics of society in which business operate. For example, religious celebrations provide business opportunities to many enterprises such as those producing sweets, decoration items, gifts etc. Similarly, in India a change in social trend towards western lifestyle has increased the demand for western wear, consumption of fast food, etc. 

Quotation: “ Change in consumption habits of people.”

Quotation: “ created a website chocolove.com for taking orders online. ”

17. Explain the role of political environment in shaping the business.? 

Ans: Political environment includes political factors such as political leadership, practices of the ruling party, policies, rules and regulations of the government, political stability  etc. 

Political stability builds confidence among the business community while political instability may bring uncertainty in business activities.

Hence the political environment holds the power to positively or negatively impact the business and its activities.

For example, if the government keeps on changing, and there is no political instability in the country, then with each change in the government, the ruling party will keep on bringing its own policies in the country, causing disruptions and losses in the activities of the business.

This is because a business functions within the framework of the political environment, and hence, when the government and its policies change, businesses are required to understand and follow such changes as well.

Factors like taxation policy and foreign trade policy affects a business in unthinkable ways. 

While on one hand, a progreesive and constructive change in these policies bring a positive change in the business, on the other hand, unstable, and unthought of changes in these policies disrupts the working and profitability of that business.

For example, after globalization, the Government of India allowed many companies to enter the Indian market to give a boost to the different industries like food processing industry etc. That paved the way for the entry of multinationals in India on a large scale. 

18. A recent rate cut in the interest on loans announced by the Banks encouraged Amit, a science student of Progressive School to take a loan from State Bank of India to experiment and develop cars to be powered by fuel produced from garbage. He developed such a car and exhibited it in the Science Fair organized by the Directorate of Education. He was awarded first prize for his invention. 

Ans: The dimensions of the business environment discussed in the above case are as follows.  

Economic Environment: I t refers to all those factors and forces that have an economic impact on the business activities. Key economic factors include inflation, money supply, price level, income level, interest rates etc. For example, increase in inflation rates result in fall in disposable incomes and as a result the demand for products falls.

Quotation: “ A recent rate cut in the interest on loans announced by the Banks ”

Quotation: “developed such a car and exhibited it in the Science Fair organized by the Directorate of Education. He was awarded first prize for his invention. ”

19.   Enumerate the benefits of understanding the business environment. 

Ans: The benefits of understanding business environment are: 

Identification of Opportunities: It enables the firm to identify opportunities and get the first mover advantage. The positive external changes provide opportunities to a business organisation to improve its performance.

Identifying Threat: It helps the firm to identify threats and provide early warning signals. Adverse changes in the external factors act as ‘threats’ to the business which hinders performance. Early identification of threats helps managers to make strategies to convert threats into opportunities.

Tapping Useful Resources: Business utilizes the resources of the external environment as inputs like finance, labour etc., and supplies its output to the environment in the form of goods and services, taxes, etc.

Coping with Rapid Changes: The business environment is extremely dynamic so the managers need to develop strategies not only to cope with the changes but also to use them as their strengths to improve their market shares.

Planning and Policy Formulation: Clear understanding and analysis of the business environment help businesses to formulate its future plans and strategies to cope with all the external changes.

Improves Performance: The continuous monitoring of the business environment and changing business practices from traditional methods help business in improving their present performance and also continue to retain its market position in the long run.

20. Business environment or Environmental Scanning helps in the identification of threats and early warning signals." Explain? 

Ans: Adverse changes in the external factors act as ‘threats’ to the business which hinders a firm’s performance. Early identification of threats helps managers to make strategies to convert threats into opportunities.

Environmental scanning helps an enterprise to recognize valuable information about the market and environment in advance, which can be used to prepare a firm for facing likely challenges. 

For example, if there is a chance of an MNC entering an Indian market, then the Indian managers of firms dealing with the similar product have to consider it as a warning signal, and an upcoming threat. In such cases, the manager will take every possible action, such as improving quality of the product, cost reduction, better customer service, etc.,  to face the probable challenge arising from the entrance of an MNC.

21. Mention four examples of acquisitions and mergers. 

Ans: Four examples of mergers and acquisitions are: 

Disney, Pixar and Marvel. 

Google and Android 

Exxon and Mobil. 

Tata and Corus Steel.

Long Answer Questions (5 or 6 Marks)

22. Metlapp Networks and Technologies Ltd. is a leader in technology innovation in the United States, creating products and solutions for connecting the world. It has a large research and development team which invented the first smartwatch, named as W-7. The watch besides showing the time also monitors a few health parameters like heart beat, blood pressure etc. While in search of markets abroad, the company found that in India, the reform process was underway with the aim of accelerating the pace of economic growth. The company decided to take advantage of simplified export procedure and removal of quantitative as well as tariff restrictions in India. 

It set up its office in Jamnagar with a view to capture the Indian market. In a short span of time, the company emerged as a market leader. Success of the company attracted many other players to enter the market. Competition resulted in reduction in prices, thereby benefiting the customers. 

(a) In the above paragraph, two major concepts related to government policy have been discussed. Identify and explain these concepts. 

Ans: The two concepts related to the government policy discussed in the question are Liberalization and Globalization. 

Liberalization: It is a reform which was introduced to remove unnecessary controls, licensing and government restrictions in an economy. It provides a greater autonomy to the business enterprises in decision-making and removes government interference.

Quotation: “take advantage of simplified export procedure and removal of quantitative as well as tariff restrictions in India. “

Globalization: Globalization is the word used to define the increasing interdependence of the world's economies, cultures, and populations, brought about by cross-border trade in goods and services, technology, and flows of investment, people, and data. Hence, Globalisation means to open ways for the various economies of the world to participate in the making of a global economy. 

Quotations: “Metlapp Networks and Technologies Ltd. is a leader in technology innovation in the United States, creating products and solutions for connecting the world.“ and “It set up its office in Jamnagar with a view to capture the Indian market. “

(b) Also, explain briefly any three impacts of these concepts on Indian business and industry. 

Ans: The three major impacts of these concepts on Indian business and industry were: 

Increased Competition: Liberalisation and Globalisation added ease in conducting business as well as increased the entry and participation of new firms in the industry, thereby intensifying the competition in the market. Due this increased competition, companies now focus on adding value to their products, and reduce the prices so as to attract more and more customers. Ultimately, customers get benefited by a wider choice of products, and reduced prices.

Higher Customer base: Liberalisation and Globalisation pave the way for technological changes in the environment. As with more research and development, creativity, and innovation, high-end technological products could be made available that would ultimately enlarge the customer base of the product. In the case as well, the digital watch and its high-end features helped the company in becoming the market leader by capturing a huge customer base in the Indian market.

Business policies: With the change in government policies, businesses also have to alter the way in which it performs its activities. Such positive change in policies helps the business in tapping opportunities by altering the way and methodology with which they perform business. Because, if a business would not make changes inline with changes made by the government, it could not survive in the market in the long run. As in the case, change in government policies of India was immediately implemented and taken benefit by the company, and they took actions accordingly.

23. Social environment of business is important for a business enterprise". Explain ? 

Ans: Social environment represents the customs and traditions, values, culture, social trends, beliefs, ethics of society in which business operate. 

A business exists within an external social environment, as well as its own internal social environment. A business is a part of the society in which it operates, it takes resources from the society, and provides goods and services in return.

Social environment includes factors, like taste and preferences of customers, trends in the market, consumption habits, the language and culture of people in the society etc. The management needs to have a constant and vigil check on the changes in the social environment, so as to exploit the right opportunities and to mitigate prospective threats. 

Cooperation and coordination between a firm and the society will flourish as well as add value to an enterprise, whereas failure to adopt changes of social environment will lead to the shift of customers from their firm to the other firm. This shift of consumer intensely impacts the long term growth and survival of business.

For example, with greater awareness among consumers about their rights, businesses are more concerned about the quality of goods they sell, hence they are more cautious regarding the quantity, quality and pricing of the goods.

Also, the change in consumer habits led to the inclination of consumers towards healthy products. This has created abundant opportunities for businesses to add and create products that could match the needs and preferences of the consumers.

Moreover a business conforming to social values, and ethics in business is likely to be more beneficial than a business who violates the ethics and social principles.

Therefore, we can say that a social environment is very important for a business.

24. Enumerate any ten Positive impacts of liberalization and globalization. 

Ans: The positive impacts of liberalization and globalization are as follow: 

Increased Collaborations: One characteristic of globalisation is the encouragement of entrepreneurial collaborations in order to ensure fast modernisation, development, and technical improvement.

Process simplification: Liberalisation has simplified the procedures of import and exports. Hence simplification in regards to registration, setting up of businesses, licensing was made possible. This leads to higher motivation, and the saving of time, energy and money on the part of business enterprises.

Increased competition: Increase in the number of Indian firms and entry of foreign companies has increased competition. Such increase in competition has benefited both, the firm as well as the customers.

More demanding customers : Increase in the number of enterprises gives consumers wider choice of products leading to rise in expectations and demands.

Rapidly changing technological environment: Fast changing technology requires companies to install the latest machinery, adopt latest techniques of production leading to an increase in investments in the business. Hence, LPG made the firms aware of the fact that only change could make them survive in the competitive market.

Necessity for change: With change in government policies business had to modify their policies and practices, invest in research and development, innovation etc.

Need for developing human resource: With change in technology, business enterprises need to educate and train their staff so that they are competent to handle changes, thus enhancing the quality of the labor force.

Market orientation: With increased awareness among consumers business enterprises had to shift the product oriented operations to market oriented operations.

Loss of budgetary support to the public sector: Public sector had to run in competition with the private sector. Therefore, they had to organise their own resources and functions efficiently.

Opportunities: It enables the firm to identify opportunities and get the first mover advantage. The positive external changes provide opportunities to a business organisation to improve its performance. Positive change in policies helps the business in tapping opportunities by altering the way and methodology with which they perform business. 

Inflow of foreign capital: With globalisation, work and trade has been made possible outside the national boundaries. This benefited the country in increased exports and the inflow of foreign capital.

25.   Explain any five negative impacts of liberalization and globalization. 

Ans: Following are the negative effects of liberalization and globalization. 

Threats from multinational companies (MNCs) : With the arrival of multinationals it is becoming difficult for small and medium business units to even survive. The entry of multinationals in the Indian markets act as a threat for the domestic firms. There have been instances, where the entry of new MNCs have led to the exit of domestic firms from the market.

Destabilization of protected environment: With easier entry of multinational companies, the Indian business environment is fast losing its protective shield. Even manufacturers of Maruti cars could not retain their market share and had to remodel their products and announce heavy price reductions from time to time. 

Decline in public sector: Public sector is losing markets and their capacity utilization has declined, hampering the pace of the country's technological and economic growth. 

Sellers' market turned into buyers' market: With the entry of foreign goods and services, shortage of goods, which was a boon for the sellers, has now turned into surplus. Resulting in lower revenue and profits. Buyers dominate the market, as they are free to make choices.

Tremendous redistribution of economic power and political power: Tremendous redistribution of economic power and political power leads to destabilising effects on the economy. Despite the continuing emphasis on promoting global prosperity and achieving a more “just world,” negative aspects of globalization remain evident in our globe. 

26. 'Explain 'fiscal reforms' and 'monetary reforms' as per economic change initiated by the Government of India since 1991. 

Ans: The explanations are:

Fiscal Reforms

There has been a reduction in the taxes and simplification of the structure of taxes on individual incomes since 1991. Fearing a heavy burden and complex nature of taxes, people would often evade taxes.

Reforms have also been made in taxes levied on commodities. The Goods and Services Tax which was passed in 2016 and came to effect in 2017, was expected to generate additional government revenue and prevent tax evasion.

Measures have been taken for the reduction in the fiscal deficit. 

Decrease in subsidies has also been made. 

Monetary Reforms 

Phased reduction of statutory liquidity ratio (SLR).

Private sector banks are allowed to set up new branches.

Banks have now been allowed access to the capital market for raising capital.

Permission for disinvestment (up to 49% of total equity). 

27. Explain any five ways in which managers have responded to changes in business environment. 

Ans: Following are the ways in which managers have responded to changes in business environment: 

Successful Conduct of Business: The manager can successfully conduct the business operations with the timely observance of any prospective opportunity or probable threat in the business environment. The managers can take necessary action as soon as they foresee a positive and negative change, thus leading to a successful conduct of the business operations. Hence, timely action benefits the firms and managers in unthinkable ways.

Diversification spree: To face competition, and take the most benefit of opportunities, the managers are diversifying their operations in multiple fields. Such as Reliance diversifying in sectors such as telecommunication, food, petroleum etc.

Chances for Growth: By identifying the changing situations and environment, the firm can gain support and win the confidence of the consumers and others. This support will bring more chances for growth and development of the firm. Positive change in policies helps the business in tapping opportunities by altering the way and methodology with which they perform business. 

Brand Building: Companies are aggressively spending money on brand building, and positioning their products in the minds of the consumers. Focus is on securing prime positions for their brands, through creative media-mix, in the minds of consumers. 

Labor: Managers are changing their behavior towards labor. Labourers have also benefited from the business environment, through higher wages and other facilities like training to upgrade their skills and job enrichment.

28. Briefly discuss the impact of government policy changes on the business and industry. 

Ans: The policies of liberalization, privatization and globalization by the government affect the functioning of the business enterprises. 

The following points show the impact of government policy changes on the business and industry. 

Increased Competition: Liberalisation and Globalisation added ease in conducting business as well as increased the entry and participation of new firms in the industry, thereby intensifying the competition in the market. Due this increased competition, companies focussed on adding value to their products, and reduce the prices so as to attract more and more customers. Ultimately, customers get benefited by a wider choice of products, and reduced prices.

Higher Customer base: Liberalisation and Globalisation pave the way for technological changes in the environment. As with more research and development, creativity, and innovation, high-end technological products could be made available that would ultimately enlarge the customer base of the product. 

Business policies: With the change in government policies, businesses also have to alter the way in which it performs its activities. The government policies directly impact the functioning of the business enterprises, forcing the businesses to alter their policies accordingly. A positive change in policies helps the business in tapping opportunities by altering the way and methodology with which they perform business. Because, if a business would not make changes inline with changes made by the government, it could not survive in the market in the long run. 

Technological Changes: The change in government policies has lead to free entry of new firms, thus increasing market competition. Therefore, with change in government policies, businesses had to make efforts in developing and using new technology, modifying the obsolete technology, investing in research and development, innovation etc.

Need for Trained Personnel: With change in technology, business enterprises need to educate and train their staff so that they are competent to handle changes, thus enhancing the quality of the labor force

Greater Market Orientation: The orientation has shifted to market orientation with the intense competition taking place in the market. That is, the enterprises produce and provide the goods and services as per the demand in the market. 

Less Budgetary Support Reliance by Public Sector Enterprises: Rather than depending on the budgetary support so as to cover the losses, the public enterprises needs to make efforts in improving its work performance, efficiency and productivity so as to successfully face the increased competition, and curb the losses. 

On the whole, the impact of Government policy changes particularly in respect of liberalization, privatization and globalization has been positive as the Indian business and industry has shown great resilience in dealing with the new economic policy. 

29. What is meant by ‘business environment’? Explain any three features of business environment.

Ans: Meaning

Business environment refers to all the factors that are outside the control of the business enterprise but may equally affect the performance of the business. The social, political, economic, technological factors that operate outside a business forms a part of the business environment.

Features of Business Environment

Totality of external forces: Includes every external or outside force that could impact a business organisation such as government, competitors, etc.

Specific and general forces: Specific forces are the forces which directly affect a specific business organisation. General forces are those forces which pose a direct impact on the overall industry, but pose an indirect effect on a business enterprise.

Inter-relatedness: The changes in general forces may result in changes in specific forces. For example, a change in the government (a political force) may lead to a change in tax rates, import-export rates (an economic force)

Dynamic nature: The external forces keep changing due to constant change in technology, consumer preferences, availability of different types of raw material etc.

Uncertainty: Constant changes in environment makes it difficult to predict changes in the external environment.

Complexity: The interrelated and dynamic nature of external forces makes it difficult to prepare one single strategy to handle all the changes.

Relativity: The impact of changes depends on business to business country to country region to region etc.

30. Explain the dimensions of Business Environment.

Ans: The dimensions of business environment are:

Economic Environment: It refers to all those factors and forces that have an economic impact on the business activities. Key economic factors include inflation, money supply, price level, etc. For example, increase in inflation rates result in fall in disposable incomes and as a result the demand for products falls.

Social Environment: Social environment represents the customs and traditions, values, culture, social trends, beliefs, ethics of society in which business operate. For example, with greater awareness among consumers about their rights, businesses are more concerned about the quality of goods they sell, or the change in consumer habits led to the inclination of consumers towards healthy products.

Political Environment: Political environment includes political factors such as political leadership, practices of the ruling party, policies, rules and regulations of the government, political stability etc. 

Legal Environment: It includes all the legislations passed, administrative orders issued, court judgements or decisions taken by government or its related offices. For example, all cigarette packets must carry a warning ‘smoking is injurious to health’

Technological Environment: It consists of forces relating to scientific

improvements and innovations, which lead to better production techniques and methods to produce goods. For example, shift from books to e-books, telephones to touch screen mobile phones.

Important Topics in Class 12 Business Studies

The important topics covered in Class 12 Business Studies are given below.

What is Marketing Mix?

What is the Stock Exchange?

Importance of Consumer Protection

Marketing Vs Branding

CBSE Class 12 Business Studies Chapter 3 is one of the most highly rated chapters on the curriculum. The elements impacting an establishment's performance outside of its regulation, as you have seen in this chapter, are the forces influencing its business environment. This chapter will help you understand how understanding the company environment may assist you in tapping helpful resources and dealing with quick changes. Some of the other important topics covered in this chapter are ways by which a firm copes with varying technical environments, the role of the political environment in shaping a business, how the social environment of a business is important for an enterprise, and the benefits of knowing the business environment thoroughly.

You can also find study resources like NCERT Solutions for Class 12 Business Studies , and Revision Notes on Class 12 Business Studies , on Vedantu for free. Also, you can sign up for our customised study plans and one-on-one LIVE classes during which our experts will help you clear all your doubts and get a good score in the 12th Board exam.

Conclusion  

When drawing a conclusion on CBSE Class 12 Important Questions for Business Studies Chapter 3: Business Environment, it's important to consider the key topics and concepts covered in the chapter. The chapter "Business Environment" in Business Studies explores the external factors that influence business operations and decision-making. It covers aspects such as the economic, social, political, and technological environment in which businesses operate.

The important questions provided in the CBSE Class 12 Business Studies textbook, along with their solutions, serve as a valuable resource for students to assess their knowledge and prepare for examinations. By practising these questions, students can strengthen their understanding of the chapter and improve their performance in assessments.

FAQs on CBSE Class 12 Important Questions for Business Studies Chapter 3: Business Environment

1. How many chapters are there in Class 12 Business Studies?

There are a total of 12 chapters in NCERT Class 12 Business Studies. Business Environment is the third chapter of this book. Students are advised to learn and revise all chapters thoroughly to score well in the exam.

2. What are the main features of a business environment?

The business environment means all the forces that are not in an enterprise's control but can affect its performance. Some of the features of a business environment are -

Total of external forces - It is the sum of all external forces.

Specific and general forces - It may be related to investors or general as in politics.

Dynamic nature - Ever-changing

Uncertain in nature - Due to the ever-changing nature

Complexity - Due to many factors in play

Relativity - Differs from place to place

Inter-relatedness - Elements are related to each other

3. Why is the business environment uncertain?

There are many factors that influence a business environment. One of them is its uncertain nature. The business environment can be uncertain due to many reasons such as a change in political policies, change in customer preferences of fashion or taste, technological advancements, increase in competition, etc. All these factors can change at any time and this is what makes a business environment uncertain. As these changes take place frequently and quickly, it becomes difficult to predict the future of a business environment.

4. What are the books for Class 12 Business Studies?

The two important books for CBSE Class 12 Business Studies are the textbooks published by the NCERT, i.e., Principles and Functions of Management, and Business Finance and Marketing. Students can also learn from other reference books and solve previous years’ question papers available on Vedantu for their exam preparation.

5. What was the impact of demonetization on the Indian economy?

The Government of India on Nov 8, 2016, announced that the high denomination notes of Rs. 500 and Rs. 1000 were not legal tenders anymore and were demonetized. The main impacts that demonetization had are the following -

Decrease in cash transactions

Increase In bank deposits

Increase in financial savings

Decline in private wealth since many high denomination notes were not returned

Digital transactions increased

Prices of real estate declined

Income tax collection increased due to an increase in disclosure

CBSE Class 12 Business Studies Important Questions

Cbse study materials.

BUSINESS STUDIES FOR CLASS 12 CHAPTER 3 BUSINESS ENVIRONMENT MCQS ALONG WITH ANSWERS

Free CBSE Business Studies Multiple Choice Questions for Class 12 along with answers, Chapter 3: Business Environment. Business Studies MCQs for Class 12 chapter-wise with answers are prepared based on the current exam pattern. Students can tackle MCQs with answers to realise their spadework level.

1. A business has to offer a wider choice in purchasing enhanced quality of goods and services in order to maintain an edge over its competitors. The implementation of the new economic policy with liberalisation, privatisation, and globalisation has posed various challenges for the corporate sector. One of the important challenges is explained in the above lines. Identify it.

(a) Increasing competition

(b) More demanding customers

(c) Necessity for change

(d) Market orientation

Answer: (a) Increasing competition

2. Which of the following is a feature of demonetisation?

(a) Tax administration measure

(b) Channelising savings into the formal financial system

(c) Development of less-cash economy

(d) All of the above

Answer: (d) All of the above

3. On 8th November 2016, with the announcement from the Government of India, all the ₹500 and ₹1,000 banknotes of the Mahatma Gandhi series have ceased to be legal tender. The government also announced the issuance of new ₹500 and ₹2,000 banknotes in exchange for the demonetised banknotes. Identify the concept being described in the above lines.

(a) Globalisation

(b) Liberalisation

(c) Demonetisation

(d) Privatisation

Answer: (c) Demonetisation

4. In today’s world, the flow of goods and services is not only cheap and fast, but reliable and secure. You can order anything you wish from any part of the world. The Internet has been connecting people without any limitations or boundaries in the way of doing business. Identify the concept being described in the above lines.

(a) Liberalisation

(b) Globalisation

Answer: (b) Globalisation

5. The Government of India launched the “Make in India” initiative in September 2014 to increase foreign direct investment (FDI) in 25 sectors. As of April 2015, FDI inflow in India increased by 48% since the launch of the “Make in India” initiative.

Identify the concept being described in the above lines, with regard to an inflow of FDI.

(a) Demonetisation

(b) Privatisation

(c) Liberalisation

(d) Globalisation

Answer: (c) Liberalisation

6. The Union Cabinet has given an ‘in-principle’ nod to divest stakes in Air India, a wholly government-owned airline. This means the government is willing to shed a substantial portion of its stake and hand over the management of the ailing airline to the private sector. Identify the concept being described in the above lines.

(c) Globalisation

(d) Demonetisation

Answer: (b) Privatisation

7. According to a report by the India Staffing Federation (ISF), India has emerged as the

fifth largest market worldwide in Flexi-staffing in 2018, and the country would have a 6.1 million Flexi-workforce by 2021. It showed that Haryana, Gujarat, Karnataka, Madhya Pradesh, and Telangana are the states with high growth potential for Flexi-staffing, but Andhra Pradesh tops the list of states with favourable business environments. Identify the features of the business environment being discussed above.

(a) Relativity

(b) Dynamic nature

(c) Uncertainty

(d) Interrelatedness

Answer: (a) Relativity

8. India continues to be a lower-middle-income country along with 46 others, while Sri Lanka has climbed to the upper-middle-income group for the fiscal year (FY) 2020, according to the World Bank’s classification of countries by income levels, released on July 1, 2019. Identify the related dimensions of the business environment.

(a) Social dimension

(b) Technological dimension

(c) Economic dimension

(d) Political dimension

Answer: (c) Economic dimension

9. India’s population is expected to grow under 0.5 percent during 2031-41 due to a decline in fertility rate and an increase in life expectancy. These changes in India’s demography will also have implications such as the proportion of elementary school-going children will witness significant declines, lack of hospital beds, and an increase in retirement age. The related feature of the business environment is described in the above lines is________.

(a) Totality of external forces

(c) Interrelatedness

(d) Relativity

Answer: (c) Interrelatedness

10. According to the World Health Organisation, 39% of adults are overweight. Over the last 40 years, the prevalence of obesity has tripled around the world. With over half of consumers drinking at least one sugary drink on a given day, regulations towards the beverage sector are likely to become increasingly onerous. In the U.K., for example, a sugar tax was introduced in 2018 on beverages containing more than 5% sugar. Identify the related dimensions of the business environment.

(a) Legal dimension and Social dimension

(b) Social dimension and Technological dimension

(c) Technological dimension and Legal dimension

(d) Political dimension and Technological dimension

Answer: (a) Legal dimension and Social dimension

11. As a result of major government initiatives, more and more people are going ‘green’. In order to keep in line with the trend, ‘Clapaway’ a carpet cleaning company, has advertised that they only use natural cleaners that come from renewable resources and that all their service vehicles are hybrid vehicles that use both gas and electricity. Identify one of the points related to the importance of the business environment and its understanding by managers, which is being highlighted in the above case.

(a) It helps in assisting in planning and policy formulation

(b) It helps in coping with rapid changes

(c) It helps in improving performance

(d) It enables the firm to identify opportunities and get the first-mover advantage

Answer: (c) It helps in improving performance

12. ‘Yo Tummy’ began its business by offering the classic combo of hamburgers and fries. But over time, their customers wanted healthier foods, so ‘Yo Tummy’ responded and began offering healthy alternatives such as salads, fruits, wraps, and oatmeal. If ‘Yo Tummy’ hadn’t responded, they may have lost customers that wanted to eat healthier foods. The above case highlights one of the points related to the importance of the business environment and its understanding by managers. Identify it.

(a) It helps in coping with rapid changes

(b) It helps in improving performance

(c) It helps the firm to identify threats and early warning signals

Answer: (a) It helps in coping with rapid changes

13. Electric vehicles with zero tailpipe emissions are emerging as a good alternative to problems like climate change, surging pollution leading to ill health, crude import bill, and energy security. Identify the related dimensions of a business environment.

(a) Economic dimension, Legal dimension, and Social dimension

(b) Social dimension, Political dimension, and Economic dimension

(c) Economic dimension, Technological dimension, and Social dimension

(d) Social dimension, Political dimension, and Legal dimension

Answer: (c) Economic dimension, Technological dimension, and Social dimension

14. The Economic Survey 2019 suggests that psychological biases can be used in the realm of tax compliance. It is in favour of using religious norms such as “dying in debt is a sin” to improve tax compliance. Identify the related dimensions of the business environment.

(b) Social dimension and Economic dimension

(c) Technological dimension and Political dimension

(d) Political dimension and Economic dimension

Answer: (b) Social dimension and Economic dimension

15. In order to boost and double India’s export of goods and services to over USD 1,000 billion by 2025, it is important to lower effective corporate tax rates, bring down the cost of capital and simplify regulatory and tax frameworks. Identify the related dimension of a business environment.

(a) Social dimension and Legal dimension

(b) Technological dimension and Political dimension

(c) Political dimension and Social dimension

(d) Economic dimension and Legal dimension

Answer: (a) Social dimension and Legal dimension

We trust that the offered Business Studies MCQs for Class 12 with respect to Chapter 3: Business Environment will help you. Assuming you have any questions with respect to CBSE Class 12 Business Studies, Chapter 3: Business Environment MCQs, drop a remark underneath, and we will hit you up at the most punctual.

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