A factory installs an automatic machine instead of manual packing. This is an example of which dimension of business environment?

Correct answer: Technological environment

The direct answer is option A, technological environment. A business environment dimension means an outside factor that affects business decisions and working. Replacing manual packing with an automatic machine is a change in tools, machinery, production methods, and automation. These belong to technology. Option A is therefore correct. Option B, political environment, concerns government, laws, public policy, and political stability; no such matter is described. Option C, social environment, concerns customs, values, population, education, and lifestyle; the example does not focus on society. Option D, economic environment, concerns income, inflation, interest rates, employment, and economic conditions; the machine itself is not an economic policy or condition. The key exam clue is a new machine or automated process. Remember: machinery, software, digital systems, and automation usually indicate the technological environment.