This quiz works best with JavaScript enabled. Home > Cbse > Class 12 > Commerce > Business Studies > Class 12 Business Studies Chapter 3 Business Environment – Quiz 2 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Business Studies Chapter 3 Business Environment Quiz 2 (60 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Inelastic demand is: A) D. unaffected by price changes. B) A variable. C) B. fluctuating. D) C. limited to luxury goods. Show Answer Correct Answer: A) D. unaffected by price changes. 2. Political and Legal Factors affect businesses by: A) Making businesses unaffected by taxes. B) Influencing how a business operates in a region. C) Limiting businesses to only certain customers. D) Helping businesses skip regulations. Show Answer Correct Answer: B) Influencing how a business operates in a region. 3. Which of the following is an ergonomic practice to prevent wrist strain while typing? A) Typing with hands flat on the desk. B) Using a wrist rest to maintain a neutral position. C) Keeping wrists raised above the keyboard at all times. D) Typing with one hand while resting the other. Show Answer Correct Answer: B) Using a wrist rest to maintain a neutral position. 4. Which of the following tools is the best for staff evalution method? A) Balance score card. B) Key performance indicator. C) Balance score evalution. D) Key performance evaluation. Show Answer Correct Answer: A) Balance score card. 5. Liberalisation was introduced to put an end to A) Controls and restrictions And open various sectors. B) Foreign exchange regulation. C) To empower private sector. D) Public sector power. Show Answer Correct Answer: A) Controls and restrictions And open various sectors. 6. How do legal regulations affect the business environment? A) They are only relevant during economic booms. B) They create barriers to entry for new businesses. C) They have no impact on business operations. D) They only apply to international companies. Show Answer Correct Answer: B) They create barriers to entry for new businesses. 7. What does SWOT analysis assess? A) Financial performance. B) Only external factors. C) Only internal factors. D) Internal and external factors. Show Answer Correct Answer: D) Internal and external factors. 8. Cuba and North Korea are examples of which type of economy? A) Mixed. B) Free Market. C) Traditional. D) Command. Show Answer Correct Answer: D) Command. 9. A new law requires all businesses to reduce plastic use. This is an example of: A) Technological Environment. B) Legal Environment. C) Economic environment. D) Suppliers. Show Answer Correct Answer: B) Legal Environment. 10. What factors contribute to the challenges faced by Indian industries in the global market? A) Language barriers. B) Trade liberalization. C) High production costs. D) Lack of technological advancements. Show Answer Correct Answer: C) High production costs. 11. To be effective the objectives of a business need to be SMART. A local car dealership aspires to have the highest market share of cars sold in the area, by the end of the year. However, in the objectives it did not lay out how many cars it plans to sell. Based on the information provided, which element of the SMART tool has it overlooked? A) T-time-specific. B) R-relevant. C) S-specific. D) M-measurable. Show Answer Correct Answer: D) M-measurable. 12. An example of an internal environment factor is A) Suppliers. B) Empoyees. C) Competitors. D) Legal issue eg consumer law. Show Answer Correct Answer: B) Empoyees. 13. Which of the following is NOT a type of interest group? A) Public Interest Group. B) Trade Union. C) Government. D) Professional Association. Show Answer Correct Answer: C) Government. 14. When an alarm sounds in the workplace, employees should: A) Finish their tasks quickly before leaving. B) Follow the evacuation route immediately. C) Ignore it unless they see an emergency. D) Ask a coworker if it's a drill. Show Answer Correct Answer: B) Follow the evacuation route immediately. 15. What is the economic basis for the private enterprise economic system? A) C. the motive of profit. B) A competition. C) B. the marketplace. D) D. manufacturer supply chain. Show Answer Correct Answer: A) C. the motive of profit. 16. This element is related to new tools, ideas, and approaches used to produce goods and services. A) Technological. B) Legal. C) Environmental. D) Economic. Show Answer Correct Answer: A) Technological. 17. The entry of the multinational companies in large numbers in the Indian market has created ..... A) Huge Demand. B) Huge Supply. C) Tough Competition. D) Huge Demand and Supply. Show Answer Correct Answer: C) Tough Competition. 18. Which of the following is an example of a micro environmental factor? A) Customer preferences. B) Economic policies. C) Global market trends. D) Government regulations. Show Answer Correct Answer: A) Customer preferences. 19. Environmental factors are ..... A) Static. B) Stable. C) Isolated. D) Dynamic. Show Answer Correct Answer: D) Dynamic. 20. Question 7:Which of the following would be considered a 'customer' in the task environment? A) A company that supplies raw materials. B) The government regulating business practices. C) A consumer purchasing a product. D) An advertising agency promoting the brand. Show Answer Correct Answer: C) A consumer purchasing a product. 21. The private sector consists of the ..... sector and informal sector A) Formal. B) Pricing. C) Quality. D) Business. Show Answer Correct Answer: A) Formal. 22. Which of the following is NOT a predicted significant technological improvement that will benefit businesses in the near future? A) Internet-based applications as more people around the world gain internet access. B) 3D printing to be used in manufacturing. C) The increased use of advanced robotics. D) The advancement of artificial intelligence to a point where they will replace humans in all walks of life. Show Answer Correct Answer: D) The advancement of artificial intelligence to a point where they will replace humans in all walks of life. 23. What are the impacts of globalization on the Indian economy? A) Increased market access. B) Isolation from global markets. C) Stagnant growth. D) Reduced cultural exchange. Show Answer Correct Answer: A) Increased market access. 24. Location of business is not a significant factor in establishing one. A) TRUE. B) FALSE. C) All the above. D) None of the above. Show Answer Correct Answer: B) FALSE. 25. Business and environment are inseparable parts. A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: A) True. 26. ..... is included in Economic Environment. A) Economic System. B) Economic Policies. C) Economic Conditions. D) All of the above. Show Answer Correct Answer: D) All of the above. 27. Political environment is part of ..... environment. A) Macro. B) Micro. C) Internal. D) None of the above. Show Answer Correct Answer: A) Macro. 28. Which of the following is an example of an external factor that can drive change in a business? A) Internal communication systems. B) Company mission statement. C) Employee training programmes. D) Technological advancements. Show Answer Correct Answer: D) Technological advancements. 29. Which technique of environmental analysis focuses on identifying strengths, weaknesses, opportunities, and threats? A) Financial Ratio Analysis. B) Value Chain Analysis. C) SWOT Analysis. D) Market Segmentation. Show Answer Correct Answer: C) SWOT Analysis. 30. Which of the following is a key characteristic of the Indian economy? A) Completely capitalist economy. B) Completely socialist economy. C) Mixed economy with features of both capitalism and socialism. D) Traditional barter-based economy. Show Answer Correct Answer: C) Mixed economy with features of both capitalism and socialism. 31. Who among the following is not competent to contract? A) Person is of sound mind. B) Person who is disqualified from contracting by any law. C) Person who has acquired the age of 16. D) Person who has acquired the age of 18. Show Answer Correct Answer: C) Person who has acquired the age of 16. 32. What are the key factors influencing the economic environment in India? A) Social and Cultural factors. B) Political and Legal factors. C) Technological factors. D) Geographical factors. Show Answer Correct Answer: B) Political and Legal factors. 33. What are social factors? A) Social mobility, market trends, cultural expectations, and socioeconomic aspects. B) Economic growth, political stability, technological advancements, and environmental changes. C) Personal preferences, individual achievements, private goals, and family traditions. D) Government policies, international relations, military strategies, and legal systems. Show Answer Correct Answer: A) Social mobility, market trends, cultural expectations, and socioeconomic aspects. 34. The cyclical fluctuations in the general level of economic activity A) Globalisation. B) Five sector circular flow. C) Investment. D) Business cycle. Show Answer Correct Answer: D) Business cycle. 35. The environment that surrounding the business is A) Bounded environment. B) Micro environment. C) Macro environment. D) Near environment. Show Answer Correct Answer: B) Micro environment. 36. Which of the following best explains why businesses must adapt to technological changes? A) To reduce employee salary burden. B) To ensure compliance with legal frameworks. C) To stay competitive and explore new markets. D) To increase complexity in operations. Show Answer Correct Answer: C) To stay competitive and explore new markets. 37. What is the difference between micro and macro environment? A) Micro involves external factors close to the business; macro involves broader external factors. B) Micro refers to broad societal factors; macro refers to internal factors. C) Micro refers to competitors; macro refers to internal operations. D) Micro includes technology; macro excludes it. Show Answer Correct Answer: A) Micro involves external factors close to the business; macro involves broader external factors. 38. Business has ..... control over the MACRO Environment A) Complete. B) Some Control/influence. C) No. D) None of the above. Show Answer Correct Answer: C) No. 39. Name one technique used for environmental scanning. A) Porter's Five Forces. B) Benchmarking. C) SWOT analysis. D) PEST analysis. Show Answer Correct Answer: C) SWOT analysis. 40. Which element is part of the Micro Business Environment? A) Competitors. B) Environmental conditions. C) Currency exchange rates. D) Government policies. Show Answer Correct Answer: A) Competitors. 41. How can businesses reduce their carbon footprint in terms of energy use? A) Switching to renewable energy sources. B) Increasing fossil fuel consumption. C) Using more incandescent bulbs. D) Expanding office hours. Show Answer Correct Answer: A) Switching to renewable energy sources. 42. The interaction with environment leads to identifying growth opportunities? A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: A) True. 43. What can rising concern for environmental sustainability lead to? A) Adoption of eco-friendly practices. B) Higher unemployment rates. C) Increased government intervention. D) Lower consumer demand. Show Answer Correct Answer: A) Adoption of eco-friendly practices. 44. External components of environment provides ..... and threats A) Strength. B) Weaknesses. C) Opportunities. D) Challenges. Show Answer Correct Answer: C) Opportunities. 45. How does the political environment affect tourism businesses? A) Government regulations only hinder tourism growth. B) The political environment affects tourism businesses by influencing stability, regulations, and government support. C) Tourism businesses thrive solely on weather conditions. D) Political environment has no impact on tourism businesses. Show Answer Correct Answer: B) The political environment affects tourism businesses by influencing stability, regulations, and government support. 46. In a chemical spill, what is the first action you should take? A) Contain the spill with nearby materials. B) Evacuate the area and notify the proper personnel. C) Attempt to clean it up yourself. D) Report it at the end of your shift. Show Answer Correct Answer: B) Evacuate the area and notify the proper personnel. 47. Which one is not a key tax principle? A) Certainty. B) Objectivity. C) Fairness. D) Transparency. Show Answer Correct Answer: B) Objectivity. 48. Customers become more environmentally conscious, what effect will this have on a business that sells compostable coffee pods? A) Negative effect as customers will stop buying their product. B) Positive effect as more customers will choose this business over their competitors. C) Neutral effect, sales will not be changed either way. D) None of the above. Show Answer Correct Answer: B) Positive effect as more customers will choose this business over their competitors. 49. What is one way businesses can affect suppliers? A) By reducing product quality. B) By forming strategic alliances. C) By ignoring their needs. D) By increasing prices. Show Answer Correct Answer: B) By forming strategic alliances. 50. How does the increase of global business operations affect the competitive landscape? A) It increases competition between businesses from different countries. B) It increases competition between businesses from the same country. C) It reduces competition between businesses from different countries. D) All of the above. Show Answer Correct Answer: D) All of the above. 51. You are tasked with conducting a SWOT analysis for a Malaysian frozen food company that exports to the United States of America (US). If the US dollar becomes strong, which category would you place that in, for your analysis? A) Weakness. B) Opportunity. C) Strength. D) Threat. Show Answer Correct Answer: D) Threat. 52. Which of the following is a characteristic of oligopoly? A) Few firms with significant market power. B) One firm dominates the market. C) Many firms with identical products. D) No barriers to entry. Show Answer Correct Answer: A) Few firms with significant market power. 53. What role does technological advancement play in shaping the business environment? A) It has no impact on the business environment. B) It creates new opportunities and challenges. C) It only affects the internal factors of a business. D) It is solely the responsibility of the government. Show Answer Correct Answer: B) It creates new opportunities and challenges. 54. Resource limitations. A) Opportunity. B) Strength. C) Threat. D) Weakness. Show Answer Correct Answer: D) Weakness. 55. Which of the following is not a characteristic of buniess environment? A) Dynamic. B) Absolute. C) Integral. D) Complexity. Show Answer Correct Answer: B) Absolute. 56. 6) Since environment is a source of both opportunities and threats for a business enterprise, its understanding and analysis can be the basis for deciding the future course of action.' Which one of the following importance of business environment is discussed above? A) It helps in coping rapid changes. B) It helps in improving performance. C) It helps in assisting in planning and policy formulation. D) It helps in tapping useful resources. Show Answer Correct Answer: C) It helps in assisting in planning and policy formulation. 57. Customers cast economic votes every time they: A) B. participate in a survey. B) C. visit a business. C) A buy a product. D) D. give their opinion. Show Answer Correct Answer: C) A buy a product. 58. What role do suppliers play in the business environment? A) They only influence pricing strategies. B) They are the end-users of products. C) They have no impact on business operations. D) They provide the raw materials needed for production. Show Answer Correct Answer: D) They provide the raw materials needed for production. 59. Which of the following is an internal factor of the business environment? A) Government policies. B) Competitors' strategies. C) Company's management and culture. D) Technological changes in the industry?. Show Answer Correct Answer: C) Company's management and culture. 60. Which stakeholder would MOST likely be concerned about system downtime? A) Cleaner. B) Competitor. C) General public. D) Customer / user. Show Answer Correct Answer: D) Customer / user. ← PreviousNext →Related QuizzesCommerce QuizzesClass 12 QuizzesClass 12 Business Studies Chapter 3 Business Environment Quiz 1Class 12 Business Studies Chapter 3 Business Environment Quiz 3Class 12 Business Studies Chapter 3 Business Environment Quiz 4Class 12 Business Studies Chapter 3 Business Environment Quiz 5Class 12 Business Studies Chapter 3 Business Environment Quiz 6Class 12 Business Studies Chapter 3 Business Environment Quiz 7Class 12 Business Studies Chapter 3 Business Environment Quiz 8Class 12 Business Studies Chapter 3 Business Environment Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books