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Business Studies · Class 12 Commerce

Ch 3Business Environment — Class 12 Business Studies, concept-first.

The term business environment refers to the sum total of all individuals, institutions, and forces that exist outside the control of a business enterprise but can still affect its performance.

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Key concepts

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Business Environment Definition

Think of yourself walking through a crowded market. You notice the weather, the time of day, the people around you, the shopkeepers, the prices, the police patrol, and even the rumours about a new tax.

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Chapter contents

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3.1

Meaning of Business Environment

The term business environment refers to the sum total of all individuals, institutions, and forces that exist outside the control of a business enterprise but can still affect its performance.

3.2

Importance of Business Environment

A business firm does not exist in a vacuum. It is surrounded by external forces — economic, social, political, technological, and legal — that shape every decision it makes.

3.3

Dimensions of Business Environment

The business environment is not a single, uniform force. It is made up of several distinct dimensions — economic, social, technological, political, and legal conditions — that together form the genera…

3.4

Indian Railway Catering and Tourism Corporation Ltd.

The textbook illustrates the technological environment with a real example: the Indian Railway Catering and Tourism Corporation Ltd. (IRCTC), a Government of India enterprise.

3.5

Economic Environment in India

The economic environment of a country is the set of macro-level factors that shape how wealth is produced and distributed.

Key Terms

The key terms of this NCERT chapter on Business Environment, exactly as listed in the CBSE Class 12 Business Studies textbook (Chapter 3), are:

Summary

Here is a summary of this NCERT chapter (Chapter 3 — Business Environment) from the CBSE Class 12 Business Studies textbook:

Very Short Answer Questions

+Show 5 questions5 questions
  1. Q1What is meant by business environment?Free
  2. Q2How does understanding of business environment help in improving performance of a business?Free
  3. Q3Give an example to show that a business firm operates within numerous inter-related factors constituting the business environment. (Hint: an…Preview
  4. Q4Krishna Furnishers Mart started its operations in the year 1954 and emerged as the market leader in the industry because of their original d…Preview
  5. Q5Name any two specific forces of business environment affecting business.Preview

Short Answer Questions

+Show 4 questions4 questions
  1. Q1Why is it important for business enterprises to understand their environment? Explain.Free
  2. Q2Explain the following terms: (a) Liberalisation (b) Privatisation (c) GlobalisationFree
  3. Q3National Digital Library of India (NDL India) works towards developing a framework of a virtual repository of learning resources with a sing…Preview
  4. Q4State the impact of demonetisation on interest rates, private wealth and real estate.Preview

Long Answer Questions

+Show 6 questions6 questions
  1. Q1How would you characterise business environment? Explain, with examples, the difference between general and specific environment.Free
  2. Q2How would you argue that the success of a business enterprise is significantly influenced by its environment?Free
  3. Q3Explain, with examples, the various dimensions of business environment.Preview
  4. Q4The Government of India announced Demonetisation of ₹500 and ₹1,000 currency notes with effect from the midnight of November 8, 2016. As a r…Preview
  5. Q5What economic changes were initiated by the Government under the Industrial Policy, 1991? What impact have these changes made on business an…Preview
  6. Q6What are the essential features of: a. Liberalisation, b. Privatization and c. Globalisation?Preview

Sample & Board Papers

Sample papers and previous-year board questions for this subject.

+Show 12 questions12 questions
  1. Q1Which of the following is an element of 'Social Environment'? (A) Rates of saving and investment (B) Expectations from the workforce (C) The…Preview
  2. Q2'SK Builders' became the market leader in the designer house segment as it was the first to recognize the need of using Artificial Intellige…Preview
  3. Q3(a) State any three features of business environment. OR (b) State any three features of 'Demonetization'.Preview
  4. Q4Raunaq, while studying at the university, felt that there should be a food joint in the university campus to provide food to students round…Preview
  5. Q5Match the various characteristics of Business environment given in Column I with their respective explanations in Column II : Column I | Col…Preview
  6. Q6Which of the following is not a part of social environment of Business ? (A) Life expectancy (B) Education system and literacy rates (C) Con…Preview
  7. Q7Alfa Graphics Ltd. was a reputed Indian company which had been in business for many years. The Chief Executive Officer of the company, Rohit…Preview
  8. Q8‘Business environment keeps on changing whether in terms of technological improvement, shifts in consumer preferences or entry of new compet…Preview
  9. Q9Green-Eats is a start-up offering plant based meal kits. It gained popularity as more young consumers were becoming health conscious and awa…Preview
  10. Q10'Sumi', a well-established domestic car manufacturer, anticipates entry of a premium foreign automobile brand in the country. The management…Preview
  11. Q11Explain any four features of business environment. OR Explain any four features of 'demonetization'.Preview
  12. Q12Which of the following is a component of economic environment ? (A) Concern with quality of life (B) Rates of saving and investment (C) Exte…Preview