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Subjects

Business Studies

Political environment

In Class 12 Business Studies, Political Environment is studied as an important dimension of the Business Environment. Students learn how government policies, political stability, ideology, administrative decisions and changes in laws can influence business operations and growth. The topic explains why businesses must monitor decisions related to taxation, trade, licensing, public expenditure and regulation, and adapt their plans to changing political conditions while recognising their responsibilities towards society and the economy.

Hard · Level 2 · 25 questions

Practice questions

01A firm takes decisions only on daily political news instead of long term industrial policy. What is the weakness in this?

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02If the government suddenly withdraws subsidy what will happen to the financial plan of an industry dependent on that subsidy?

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03In political environment what risk can arise when administrative discretion is high?

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04In which situation will timing be important to use an opportunity created by political environment?

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05If government offers tax relief but eligibility conditions are complex what should a business do?

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06With frequently changing government trade policy which provision can be useful in supply contracts?

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07What will be the effect if government makes consumer grievance rules stricter for a platform business?

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08How does political ideology affect business environment?

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09If political acceptance of an industry is low which non financial risk increases for a company?

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10Which option shows active scanning of political environment?

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11How can government inclusion of an industry in priority sector lending list affect it?

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12If a new government reduces public expenditure what risk will a company dependent on government contracts face?

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13In which situation will political environment directly change market entry strategy?

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14Which statement correctly shows the link between political and economic environment?

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15A company uses different product labels in different states according to government policy. What does this show?

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16If government controls both price and quantity in a sector what analysis should a manager do?

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17When policy continuity is weak in political environment what may a bank do while lending to a project?

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18Which option shows need to change business model due to political environment?

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19If government makes warning message compulsory on a product what balance must a brand manager maintain?

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20In which situation will government policy benefit not be received merely by announcement?

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21Government brings strict regulation on some online services. Which decision of a platform company will be most affected?

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22If policy makers consider an industry socially sensitive what strategy will a company need?

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23Which example can change capital budgeting decision due to political environment?

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24What can be the possible effect of an anti industry attitude of government in political environment?

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25A multinational company studies probability of power change and regulatory history before entering a country. For what purpose is this done?

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