Introduction
1. Organizations depend upon which environment for Input:
(a)Technological Environment
(b)Social-Economic Environment
(c)External Environment
(d)Legal Environment
2.What is the single word that can best describe today’s business?
(a)Technology
(b)Persistence
(c)Profit making
(d)Change
3.A business is created to provide:
(a)Products to Customers
(b)Services to Customers
(c)Employment opportunities
(d)All of the above
4.In order to survive over the long term, a company must have the:
(a)Ability to Prosper
(b)Ability to change
(c)Both (a) and (b)
(d)None of the above
5.As per Charles Darwin, who survives?
(a)Strongest
(b)Most Intelligent
(c)Most responsive to change
(d)All of the above
6.Data which is useful in decision making is called?
(a)Database
(b)Information
(c)Resource
(d)Law
7.Which one of the following is not true about business ?
(a)It is created to provide products or services to customers.
(b)It creates job opportunities.
(c)It is beneficial to Society.
(d) It always gives return on investment.
8. Read the following three statements:
(i)The environment is constantly changing in nature.
(ii)Various environmental constituents exist in isolation and do not interact with each other.
(iii) The environment has a far reaching impact on organizations.
From the combinations given below select an alternative that represents statements that are true:
(a) (i) and (ii)
(b) (ii) and (iii)
(c) (i) and (iii)
(d) (i), (ii) and (iii)
9. Organic objective of business
(a) Sales profit
(b) Fitness of human resources
(
c) Product usage and disposal
(d) All of the above [Nov. 2019]
10. Which of the following capability a company require to survive in long term?
(a) Frequent change in work force
(b) The ability to change
(c) Vision to acquire profit
(d) Expansion in territory of business [July 2021]
Meaning of Business Environment
11. Which one of following is not true about Business Environment?
(a) It represents all external forces, factors or conditions that exert same degree of impact on business decisions.
(b) The success of business is affected by business environment.
(c) The business must continuously monitor and adapt itself to the environment.
(d) It includes internal forces only.
12. The integral elements of business environment include.
(a) Internal forces
(b) External Forces
(c) Both (a) and (b)
(d) Either (a) or (b)
13. As per Traditional authors, the integral elements of business environment include:
(a) Internal forces only
(b) External forces only
(c) Internal & External forces
(d) Internal or External Forces
14. In order to Survive and proposer a business:
I. Must Continuously monitor
II. Must adapt itself to the environment
III. Must Concentrate on its weakness only
IV. Must Concentrate on its Strength only.
(a) I
(b) I and II
(c) II and III
(d) III and IV
Characteristics of Business Environment
15. Which of the following is not an important characteristic of business environment?
(a) Image building
(b) Giving direction for shrinking
(c) Continuous learning
(d) Opportunities and threats [Nov. 2020]
16. What is not a characteristic of business environment?
(a) Static
(b) Complex
(c) Far reaching
(d) Multi-faced [CA CPT May 2019]
17. Which of the following are not characteristics of business environment:
(a) Complex
(b) Dynamic
(c) Single Faceted
(d) Far reaching impact [CA CPT May 2018]
18. Which is not a feature of business environment?
(a) Simple
(b) Complex
(c) Multi fact
(d) Dynamic [CA CPT Nov. 2018]
19. It is easy to understand the business environment in parts but difficult to grasp in totality. Therefore, Business Environment is.
(a) Complex
(b) Dynamic
(c) Multi-faceted
(d) Far Reaching impact
20. Now-a-days, the film industry generates revenue from ring tones/ caller tunes rather than sale of music
C.D. It exhibits _____________ feature of business environment.
(a) Complex
(b) Dynamic
(c) Multi-faceted
(
d) Far Reaching impact
21. An organisation like Aditya Birla Group has moved from textile to cement, to retail and to financial services as well as telecom due to changing circumstances. This example is related with _______ feature of Business Environment.
(a) Complex
(
b) Dynamic
(
c) Multi-faceted
(
d) Far Reaching impact
Importance of Business Environment
22. There is a ___________ interaction between Business and Business Environment.
(
a) Close
(
b) Close and continuous
(
c) Close and static
(
d) Continuous and Static
23. The interaction between Business and its Environment, helps the business in:
(a) Determining Opportunities and Threats
(b) Continuous learning
(
c) Giving directions for growth
(
d) All of the above
24. In relation to solving the problem of shortage of Electricity, “CPP” means:
(
a) Captive Power Plant
(
b) Creative Power Plant
(
c) Central Power Plant
(
d) Controlled Power Plant
25. The interaction between Business and Environment brings out:
(a) Opportunities for the business
(b) Threats to the business
(c) Opportunities for and Threats to the business
(d) Complex and Dynamic analysis.
26. Which one of the following is not an advantage of Business Environment to the business?
(a) Determination of Opportunities & Threats
(b) Meeting Competition
(c) Image Building
(d) Identification of financial needs.
Relationship between organisa-
tions and its Environment
27. Relationship between organisation and environment can be described through:
(a) Exchange of information
(b) Exchange of resources
(c) Exchange of influence and power
(d) All of the above
28. Which one of the following is the major areas as regards interaction of organisation and its environment?
(a) Exchange of Information
(b) Exchange of Resources
(c) Exchange of influence power
(d) All of the above.
29. The nature of relationship between the organization and the Environment depends upon:
I. Size of organisation
II. Age of organisation
III. Nature of Business
IV. Nature of ownership
V. Degree of Professionalization of management.
(a) I and II
(b) I, II and III
(c) I, II, III & IV
(d) I, II, III, IV & V
30. Which one of the following is not true about External Environment?
(a) It offers opportunities
(b) It offers limitations also
(c) It creates pressures & threats
(d) It never affects small business
31. Which one of the following Companies is affected by FMCG Company ‘Patanjali’ endorsed by Baba Ramdev?
(a) Hindustan Unilever Ltd.
(b) P&G Ltd.
(c) Dabur Ltd.
(d) Bajaj Auto Ltd.
32. In relation to resources, “5M” represents:
(a) Men, Money, Method, Machine and Material
(b) Management, Motivation, Money, Machine and Material
(c) Morale, Money, Method, Machine and Material
(d) Mobility, Method, Management, Machine and Material.
33. In the relationship between organizations and its environment, there is exchange of:
(a) Information
(b) Resources
(
c) Influence and Power
(d) All of the above.
34. Which one of the following Statement is incorrect?
(a) The organisation is dependent on the external environment for disposal of its output of products and services.
(b) The organisation scans the external environmental valuables.
(c) Apart from gathering in formability, the organization itself transmits information to several external agencies.
(d) The external environment offers strengths and weakness.
Organizations Response to its Environment
35. Which one of the following is organization’s response to its Environment?
(a) Administrative
(b) Competitive
(c) Collective
(d) All of the above.
36. The formation or clarification of the organization’s mission; the development of objectives, policies and budgets, etc. are the examples of ______________ response of organisation to environment :
(a) Administrative
(b) Competitive
(c) Collective
(d) None of the above
37. Which of the following internal strategies to respond to environment involves formulation and clarification of organization’s mission?
(a) Competitive Response
(b) Administrative Response
(c) Dynamic Response
(d) Collective Response
38. The methods like bargaining, Contracting, Co-opting, creating joint ventures, etc. are related with ___________ response of organisation to its environment.
(a) Administrative
(b) Competitive
(
c) Collective
(d) Ministerial
39. What are the three classes of organization’s internal responses that business can opt?
(a) Automatic Response, Comprehensive Response and Collective response
(b) Administrative Response, Comprehensive Response and Collective Response
(c) Administrative Response, Competitive Response and Collective Response
(d) Automatic Response, Competitive Response and Collective Response [July 2021]
40. In order to respond appropriately, the organizations must:
(a) Have the Capacity to monitor
(b) Make sense of their environment
(
c) Identify and attend the environmental factors
(d) All of the above.
41. In order to sustain competitive advantage, organizations must achieve an external position vis-à-vis their competitors or perform internally in ways that is/are:
(a) Unique
(b) Valuable
(c) Difficult to imitate
(d) All of the above.
42. Which of the following statement is incorrect as regards organization’s response to its environment?
(a) Organizations must have the capacity to monitor and make sense of their environments.
(b) Organizations must identify and attend to the environmental factors and features that all closely related to goal achievement and performance.
(c) Organizations must have the interval capacity to develop effective responses.
(d) Organisation can function ignoring the environment.
43. ABC company is aiming towards Joint venture and partnership with other firms to manage uncertainly. This is an example of following type of Organizational response to the environment?
(a) Administrative response
(b) Collective response
(c) Competitive Response
(d) Micro environmental response [Nov. 2020]
Environmental Influences on Business
44. In relation to a popular cold drink “Pepsi”, which one of the following is not internal factor?
(a) Packaging
(b) Scheme & Promotion
(c) Distribution Networks
(d) Health Awareness
45. Which one of the following statement is incorrect?
(a) Business does not function in an isolated Vacuum.
(b) Business function within a whole gambit of relevant environment.
(c) Businesses have to negotiate their ways through it.
(d) Business must monitor the environment periodically.
46. A Successful business has to ___________ the various opportunities and threats in its environment.
(a) Identify
(b) Identify and appraise
(
c) Identify, appraise and respond to
(
d) Identify, appraise, suggest and respond to.
47. Apart from the natural environment, environment of humans include:
(a) Family
(b) Friends and peers
(c) Neighbours and society
(d) All of the above.
48. A successful business has to identity, appraise, and respond to the various and in its environment.
(a) suppliers and customers
(b) competitors and creditors
(c) rules and regulations
(d) opportunities and threats [Dec. 2021]
49. Which of the following is/are included in man-made structures within an environment?
(a) Buildings and Roads
(b) Furniture
(c) Other Physical infrastructure
(d) All of the above
50. Different organizations use different inputs & produce different outputs. The input-output exchange activity is.
(a) Different for organizations
(b) A continuous process
(c) It calls for an active interaction with the external environment
(d) All of the above
51. Business functions as a part of broader environment. Business converts resources through various processes. This exchange process may bring…………………
(a) Profits
(b) Reputation
(c) Good Public Image
(d) Any of the above
52. In an attempt to identify a framework for understanding the environment of organizations, various steps are required.
I. Explicit Consideration of immediate environment
II. To Check the nature (Static/ Simple/Complex)
III. Auditing of environmental influences.
The Sequential steps are
(a) I, II & III
(b) I, III & II
(c) II, III and I
(d) III, II and I
Environmental Analysis
53. Environmental Analysis helps in:
(a) Providing input for strategic decision making
(b) Turning threat’s to firms advantage
(c) Anticipate opportunities and to take optimal responses
(d) All of the above
53A. National Water Mission is related to:
(a) Environmental Aspect
(b) Legal cause
(c) Social welfare
(d) Economic planning
54. Business Environment analysis help in:
(a) Give directions for growth
(b) Determining opportunities and threats
(
c) Image building
(d) All of the above.
[CA CPT Nov. 2018]
55. Which of the following is not the basic goal of environmental Analysis?
(a) Understanding of Current and potential changes taking place in the environment.
(b) Provide inputs for strategic decision making.
(c) Facilitate and foster strategic thinking in organization.
(d) Provide the internal strengths of the organisation.
56. Environmental analysis helps in except ______________
(a) Anticipate opportunities and to take optimum responses
(b) Turning threats to firm’s advantages
(c) Providing input for strategic decision making
(d) Avoiding competition
[June 2022]
57. When the company does not react to the demands of the environment by changing its Strategy, the result is :
(a) Declining performance of the Company
(b) Forgoing of opportunities available
(
c) Ignoring the treats to the firm
(d) All of the above
58. Which of the following signifies the utility of Environmental analysis?
(a) It gives the time to strategists to anticipate the opportunities
(b) The strategists can plan to take optional response to the opportunities.
(c) Strategists can develop an early warning system to prevent threats.
(d) All of the above
59. Select the correct statement out of the following:
(a) Environmental factors are totally beyond the control of a single industrial enterprise.
(b) Environmental factors are largely beyond the control of a single industrial enterprise.
(c) Environmental factors are totally within the control of a single industrial enterprise.
(d) None of the above.
60. Analyzing process of change in the business environment involves conceptualizing its as:
(a) Complex
(b) Static
(c) Dynamic
(d) Diverse
Environmental Scanning
61. ________________is the process by which organizations monitor their relevant environment to identify opportunities and threats affecting their business for the purpose of taking strategic decisions.
(a) Forecasting
(b) Assessment
(
c) Scanning
(d) None of the above
62. Environmental Scanning must identify.
(a) Threats existing in the environment
(b) Opportunities existing in the environment
(c) Threats and opportunities existing in the environment
(d) Threats, Opportunities, Strengths and Weaknesses.
63. In environmental scanning, the factor ___________ represents certain happening in the internal or external organizational environment which can be observed and tracked.
(a) Events
(b) Trends
(
c) Issues
(d) Expectations
64. ____________ is important and specific occurrence taking place in different environmental sectors.
(a) Events
(b) Trends
(
c) Issues
(d) Expectations [CA CPT Nov. 2018]
65. Events, trends issues and expectations are an outcome of______
(a) Environmental analysis
(
b) Micro environment
(
c) Macro Environment
(
d) Environmental scanning [Dec. 2021]
66. Trends relate to:
(a) Happening of events in internal Environment
(
b) Grouping of similar or related events
(
c) Demands made by Interested group
(d) None of the above
67. Factors like Trends, Events of different interest groups are needed to be considered in..............
(a) Environmental analysis
(b) Environmental inference
(
c) Environmental response
(d) Environmental scanning [Nov. 2020]
68. __________ are the general tendencies or the causes of action along which events take place.
(a) Events
(b) Probability
(
c) Trends
(
d) Directions
69. The following factors are an outcome of environmental scanning except the
(a) Expectations
(b) Trends
(
c) Issues
(
d) Strategic thinking [June 2022]
70. The demands made by interested groups in the light of their concern for issues that arise in response to events and trends is called as ______________.
(a) Appraisal
(
b) Evaluation
(
c) Observation
(
d) Expectations
71. The businesses should continuously _____________ and ____________ to the environment if it is to service and prosper.
(
a) Identify, appraise
(
b) Monitor, adapt
(
c) Identify, monitor
(
d) Monitor, appraise
72. While scanning environment, events are which of the following?
(a) Group of similar events
(b) Current concerned events
(
c) Demand made by Interested groups
(
d) Observed and tracked [July 2021]
73. Which one of the following is not a factor which need to be considered for environmental scanning?
(a) Events
(
b) Trends
(c) Issues
(d) Strategy
74. Perceiving the needs of the external environment and catering to them, satisfying the expectations and demands of the clientele groups is:
(a) Reciprocal agreement
(b) Interdependent process
(c) Management process
(d) Interaction process
75. Change of customer’s liking from oily foods to healthy packaged foods can be classified amongst which of the following?
(a) Trend
(b) Event
(c) Issue
(d) Expectation
76. Which of the following is a part of process of Environmental Scanning?
(a) Scanning Strategic
(b) Perceived Environment Change
(c) Strategic change
(d) All of the above.
Components of Business Envi-
ronment
77. A threat is
(a) An unfavourable condition in organization environment which creates risk or damage to the Environment
(b) An inherent limitation or constraint
(
c) An unfavourable condition in organization environment which consolidates its strength
(d) None of the above
78. Internal Environment includes
(a) Demography
(b) Customer
(c) Economic
(d) Mission and Objective [CA CPT May 2019]
79. Opportunity is
(a) Inherent Capacity
(b) Strategic disadvantage
(c) Favourable condition
(d) None of the above [CA CPT May 2019]
80. SWOT stands for:
(a) Strength, Weakness, Opportunity, Threats
(b) Strong, Weak, Opportunity, Transport
(
c) Strong, Weak, Occurring, Things
(
d) Strength, Weak, Opportunity, Things [CA CPT May 2018]
81. Through SWOT analysis:
(a) Strengths and weakness existing within the environment can be matched with opportunities and threats in the organisation.
(b) Strengths and weakness existing outside the organisation can be matched with opportunities and threats with the internal environment.
(c) Strengths and weakness existing outside the organisation can be matched with opportunities and threats with the external environment.
(d) Strengths and weakness existing within an organisation can be matched with opportunities and threats in the environment.
82. Which one of the following is not a part of interval Environment?
(a) Value System
(b) Mission and objectives
(c) Customers
(d) Labour Union
83. Vikas Diagnostics is in the diagnostic industry which is highly competitive and fragmented with several companies present in the market. Its presence is also restricted and over dependent on states mostly in southern India. This is a sign of ………………
(a) Strength
(b) Weakness
(
c) Opportunity
(d) Threat
[Dec. 2021]
84. The Micro Environment of external Environment includes:
(a) Market
(b) Technological
(c) Demographic
(d) Economic
85. An effective organizational strategy includes which of the following activities ?
(a) Capitalizes on the opportunities through the use of threats
(b) Neutralizes the threats by minimizing the impact of weaknesses
(c) Neutralizes the opportunities by minimizing the impact of weaknesses
(d) Capitalizes on the weaknesses through the use of threats
[July 2021]
86. The interval environment of business organisation is composed of multiple elements existing within the organisation. It includes:
(a) Management
(b) Current Employees
(c) Corporate Culture
(d) All of the above
87. The business should continuously ………….. and ………….. to the environment if it is to survive and prosper.
(a) Identify, appraise
(b) Monitor, adapt
(
c) Identify, Monitor
(
d) Monitor, appraise
[Jan. 2021]
88. The Micro and Macro environment are the major types of :
(
a) Interval Environment
(b) External Environment
(
c) Both Internal and External environment
(d) Business Environment.
89. The growing demand for the products or services, that a company provides, may be regarded as:
(a) Opportunity
(b) Strength
(c) Weakness
(d) Threat
90. The emergence of strong new competitors who are likely to offer stiff competition to the existing Companies in an industry is an example of :
(a) Threat
(
b) Weakness
(c) Problem
(d) Hurdle
90A. Emergence of strong new competitors in the industry is an example of:
(a) Strength
(b) Weakness
(
c) Opportunity
(d) Threat
91. A Company is having superior research and development skills which can be used for new product development so that the Company gains competitive advantage. It is an example of :
(
a) Potential
(
b) Strength
(
c) Competitive advantage
(d) Strong Capabilities.
92. Process of strategy formulation starts with:
(a) Appraisal of external and internal environment of the organization
(b) Performance analysis
(c) Choice of strategy
(d) None of the above
93. A ___________ is inherent capacity which an organisation can use to gain strategic advantage over it’s competitors.
(a) Strength
(b) Opportunities
(
c) Threat
(d) Weakness
[CA CPT Nov. 2018]
94. An understanding of the external and internal environment is crucial for the ___________ of any organisation.
(a) Existence
(b) Growth
(
c) Profitability
(d) All of the above
95. The opportunities and threats operate in ______________ environment.
(a) Internal
(b) External
(
c) Internal and External
(d) Micro
96. An organization should use it’s ___________ to minimize impact of _______________.
(a) Strengths, weakness
(b) Opportunities, weakness
(
c) Strengths, Threats
(d) Opportunities, Threats.
Micro Environment
97. According to _______________, the aim of the business is to create and retain customer.
(a) Peter Drucker
(b) Adam Smith
(
c) Henry Ford
(d) Schumpeter
98. _______________ have a vested interest in the well-being of the company.
(a) Shareholder
(b) Directors
(
c) Owner
(d) Employees
99. Cost structure of an industry is effected by __________ own bargaining power.
(a) Organizations
(b) Suppliers
(c) Consumer
(d) Intermediary
[CA CPT May 2019]
100. All are elements of micro environment except:
(a) Consumer
(b) Suppliers
(c) Competitors
(d) Society
101. Competition brings direct benefit to
(a) Customers
(b) Suppliers
(c) Government
(d) Intermediaries
[CA CPT May 2019]
102. Competition is beneficial to the competing firms besides benefiting the ____________?
(a) Intermediaries
(b) Customers
(c) Producers
(d) Financiers [Jan. 2021]
103. The market is larger than customers. The market is to be studied in terms of.
(a) Actual and potential size
(b) Growth prospect
(c) Attractiveness
(d) All of the above.
104. The price sensitivity of the market is an important factor of which element of Micro environment:
(a) Suppliers
(b) Market
(c) Intermediaries
(d) Customer
105. Microenvironment should address the following except_____
(a) The employees of the firm
(b) Intermediaries
(c) Suppliers
(d) Local Authorities [Dec. 2021]
106. _____________ exert a considerable influence on the business organizations. They are the ones who act as a bridge between the manufacture and the marketer.
(
a) Customers
(b) Intermediaries
(
c) Suppliers
(
d) Organisation.
107. The performance of business in the private sector is measured by:
(
a) Profitability
(
b) Customer Satisfaction
(
c) Number of employees
(d) The salary of BOD
108. Environment which is close to business and affect its capacity to work is known as __________environment.
(
a) Micro
(b) Macro
(
c) Internal
(d) External
108A. Which of the following does not fall in the category of macro environment?
(a) Big Bazaar
(b) Fiscal Policy
(c) Consumer Protection Act
(d) Type of Government
AUTHOR : RITU GUPTA