Question

Economic environment refers to which of the following?

• A. All external forces which have a bearing on the functioning of business
• B. All forces which have an economic impact on business
• C. All internal forces which have a bearing on the functioning of business
• D. Protection of consumer

Answer 1

Answer: (B)

All forces which have an economic impact on business

Economic environment includes all those forces which have an economic impact on business. Accordingly, total economic environment is consisting of agriculture, industrial production, infrastructure, planning, basic economic philosophy, stages of economic development, trade cycles, national income, per capita income, savings, money supply, price level and population.