3.2 External Influences - Economic, Financial, Geographic, Social, and Legal

Question 1

What is deregulation

Answer 1

Deregulation is the removal of government regulation from industry, with aim of increasing efficiency and improving competition

Question 2

What is globalisation

Answer 2

Globalisation is the process by which the world is becoming increasingly interconnected as a result of massively increased trade and cultural exchange

Question 3

What are the impacts of Globalisation

Answer 3

• Increased competition
• expanded markets
• location flexibility
• diversification
• access to better labour

Question 4

What are three of the largest social influences on a business?

Answer 4

• the growing awareness of the environment (environment preservation)
• the growing desire for businesses to provide family friendly workplaces (changing family structures)
• the growing belief that businesses must cater for workplace diversity (workplace diversity)

Question 5

What are legal influences

Answer 5

Legal influences are the regulations (legal framework) within which a business must operate

Question 6

What are regulations

Answer 6

Regulations are rules, laws, or orders that businesses must follow

Question 7

What are economic influences?

Answer 7

Economic influences relate directly to their economic environment which is dependent on changes in economic growth.

Question 8

What happens when there are changes in the external envrionment?

Answer 8

Changes in the external environment make it necessary for managers to make adjustments to business operations

Question 9

What are external influences

Answer 9

The external environment includes those factors over which the business has little control

Question 10

What are social influences

Answer 10

Social influences refers to the changing tastes and preferences of consumers and their views on a businesses role in society