Topic 4

Question 1

Meaning of macro environment

Answer 1

Always changing and developing.
Businesses have no control over environment

Question 2

Reasons why the macro environment can be a challenge to the business.

Answer 2

Business has no control.
Environment always changing.

Question 3

Components of the macro environment and examples of each

Answer 3

Physical environment
Economic
Social
Cultural
Technological
Demographic
Legal
Ploticam
International
Institutional

Question 4

Pestil

Answer 4

Political
Economic
Social
Technological
Legal
Environmental

Question 5

Political environment

Answer 5

Represents government and institutions and public and private stake holders that influence the business. Actions taken by the government.

Question 6

Examples of Political environment

Answer 6

Tax policy :
Tax rates decided by the giv that impact businesses.
Corruption:
Impacts the implementation of the rule of law and democratic values.
Political instability :
Protects and strikes impact on investment , consumption and economic growth

Question 7

Challenges of political environment

Answer 7

Political instability:
Strikes protest cause instability and delays in productivity.
Tax policy :
Increased taxation same the same effect as an increase in costs.
Corruption:
Can cause shareholders and investors to lose trust and confidence in business

Question 8

Economic environment

Answer 8

External economic factors that influence buying habits of consumers and businesses.

Question 9

Economic environment examples

Answer 9

Inflation
Inflation decreases the value money.
Intrest rate:
Influence the cost of the capital of the business.
Exchange rate :
Price of rand in terms of another currency imports and exports

Question 10

Social environment

Answer 10

The intermediate lyrical and social setting in which people lice and they society in which the business operates.

Question 11

Economic environment challenges

Answer 11

Inflation :
Rising costs could affect business sales and profitability.
Intrest rates:
High intrst rates mean that olasns will become more expensive
Exchange rates:
Fluctuations in foreign currency ay restrict imports

Question 12

Social environment examples

Answer 12

1.Social issues
Includes poverty
2.Health issues
Hiv and aids , tb
3.Language

Question 13

Social environment challenges

Answer 13

1. Social issues affect consumer spending and business profitability
2. Serious health issues have negative effect on employee productivity.
3. Business may nit br conversant woth local language of their customers

Question 14

Technological environment

Answer 14

Development in the field of technology with new innovative knowledge.

Question 15

Technological examples

Answer 15

1.Technological developments
Wireless communication, bus techniques and smartphone applications.
2. Technical skills
Requires training and retaining employees
3. High maintenance cost
Expensive to buy new tech but expensive to maintain

Question 16

Technological Challenges

Answer 16

1. Business may not be aware or able to keep up with latest tech.
2. Employees may not be skilled to maintain new tech equipment.
   3.staying up to date with latest and greatest tech is important

Question 17

Legal environment

Answer 17

Laws passed by the government with affect businesses

Question 18

Legal environment examples

Answer 18

1.Business law
Skills development act (SDA)
Employment Equity act ( EEA)
2. Competition laws
Promotes market competition by regulating anti competitive conduct by companies.
3. Municipal laws
Law passed by local gov such as zoning ordinances, business hours , permits and licenses

Question 19

Legal environment challenges

Answer 19

1. Consider certain acts that may have direct impact on the business.
2. businesses may be liable to paying fines for non adherence
3. Businesses have to apply for trading license before they are able to legally trade

Question 20

Environmental

Answer 20

Refers to physical and natural and international and global environment

Question 21

Physical environment

Answer 21

Natural and man made variables that surround businesses

Question 22

Examples of physical environment

Answer 22

1.Non renewable resources
Depletion of non renewable resources
2.Pollution
Air , water and noise

Question 23

Challenges of physical environment

Answer 23

1. Some natural resources are expensive.
2. Measures to dispose waste material also expensive

Question 24

International environment

Answer 24

Uncontrollable local and international interactions that influence how a business operates

Question 25

International environment examples

Answer 25

1. Globilisation
   International trade
2. Civil wars

Question 26

International environment challenges

Answer 26

1.Exploitative nature of large multinational corporations
2. International problems impact businesses across the world