Practicing Success

Target Exam

CUET

Subject

Business Studies

Chapter

Business Environment

Question:

Why does a business enterprise engage in activities to gather resources from its environment?

Options:

To provide free services to the community

To establish dominance over competitors

To convert resources into outputs desired by the environment

To avoid any interaction with the environment

Correct Answer:

To convert resources into outputs desired by the environment

Explanation:

Environment is a source of various resources for running a business. To engage in any type of activity, a business enterprise assembles various resources called inputs like finance, machines, raw materials, power and water, labour, etc., from its environment including financiers, government and suppliers. They decide to provide these resources with their own expectations to get something in return from the enterprise. The business enterprise supplies the environment with its outputs such as goods and services for customers, payment of taxes to government, return on financial investment to investors and so on.