exam questions

Question 1

Advise a businesses on the relationship between Micro, Market, and Macro Environments

Answer 1

Micro Environment:

Close to the Business: Includes factors like employees, customers, suppliers, and competitors.
Control: Businesses have some control over these factors and can influence them directly.
Market Environment:

Industry-Specific Factors: Includes market trends, customer preferences, and industry competition.
Influence: Businesses can influence these factors but don’t have full control over them.
Macro Environment:

Wider Economy and Society: Includes economic conditions, government policies, social trends, and technological changes.
Adaptation: Businesses have little control over these factors and must adapt to changes.
Relationship Between the Environments
Interconnected Impact: Changes in the macro environment can affect the market and micro environments. For example, new technology (macro) can change industry standards (market) and require businesses to train employees (micro).
Strategic Planning: Understanding and monitoring these environments helps businesses make better strategic decisions and stay competitive.