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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 6 · 25 questions

Practice questions

01If government suddenly reduces the cash transaction limit which process of a wholesaler will be most affected?

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02When import quota is suddenly reduced in government policy which party immediately needs an alternative plan?

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03Which statement shows proactive adaptation to political environment?

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04Government increased the minimum investment limit in a sector. What will be the effect on small new entrepreneurs?

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05In which situation can political environment change a company's product portfolio strategy?

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06If government brings a tax law change with retrospective effect what will be the main concern of business?

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07Which example shows government policy affecting location decision of an industry?

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08Government increased advertising control on a sensitive industry. Which policy of the company will be affected first?

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09A company adds a price adjustment clause in contracts when government policy changes. It protects against which risk?

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10In which situation will political environment change a company's human resource strategy?

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11If government imposes mandatory standard certification on a product what can be the short term effect?

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12When can an opportunity created by government policy be wrongly assessed?

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13Which option shows combined effect of political and technological environment?

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14If political leadership adopts a policy to strengthen the public sector again what should private companies analyse?

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15Government banned export of raw material so domestic industry gets supply. What is this for a domestic processing unit?

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16In which situation can compliance failure from political environment threaten business continuity?

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17If government limits remittance of dividends in an industry what will be the main concern of a foreign investor?

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18Government made a large warning image mandatory on product packs for public health reasons. What balance will the manufacturer need?

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19Which statement correctly explains difficulty of forecasting political environment?

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20If government sets production limit for an industry which decision should the manager focus on most?

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21Government placing a sector in high risk category for tax scrutiny is what signal for a company?

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22Which example shows political environment affecting a company's revenue model?

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23If a government contract has a clause to withhold payment after policy change what is the contractor's main risk?

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24In which situation can an opportunity from political environment be used by a small unit and not only a large company?

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25Which statement makes it clear that political environment should not be understood only as elections?

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