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Which statement gives the most correct strategic view of legal environment?

Answer and explanation

Correct answer: Laws affect cost risk trust and opportunity

The direct answer is option C: laws affect cost, risk, trust, and opportunity. The legal environment means the laws, regulations, court decisions, government requirements, and enforcement practices that influence business. A strategic view does not treat law as only punishment. Legal rules can increase operating or reporting costs, create compliance and litigation risk, affect customer and investor trust, and also create opportunities for firms that adapt early, innovate responsibly, or gain a reliability advantage. Option A, laws only give penalties, is too narrow because laws also set standards and create rights, protections, and opportunities. Option B, laws are separate from business, is false because every business decision must operate within a legal framework. Option C is correct because it includes several connected strategic effects. Option D, laws only decide weather, is irrelevant and factually absurd. Exam cue: legal environment is an external strategic factor, not merely a punishment system.

Related tags

Business-EnvironmentLegal-EnvironmentClass-12Expert

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