It is difficult to understand the impact of social, economic, political or legal factors on change in demand of a product in the market. Which feature of the business environment is indicated here?
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → Complexity
Option (1) Relativity — Incorrect. Relativity means the environment is different from country to country and even from region to region.
Option (2) Uncertainty — Incorrect. Uncertainty means it is very hard to predict what will happen in future. The question is not about predicting the future. It is about understanding the effect of many forces at the same time.
Option (3) Inter-relatedness — Incorrect. Inter-relatedness means the parts of the environment are closely linked and affect each other.
Option (4) Complexity — Correct. The business environment is made up of many forces that are linked and keep changing. So it is easy to understand in parts but hard to understand as a whole. For example, it is difficult to know the relative impact of social, economic, political, technological or legal factors on the change in demand of a product.
NCERT (2026-27 Edition): “Complexity: Since business environment consists of numerous interrelated and dynamic conditions or forces which arise from different sources, it becomes difficult to comprehend at once what exactly constitutes a given environment. In other words, environment is a complex phenomenon that is relatively easier to understand in parts but difficult to grasp in its totality. For example, it may be difficult to know the extent of the relative impact of the social, economic, political, technological or legal factors on change in demand of a product in the market.” “Uncertainty: Business environment is largely uncertain as it is very difficult to predict future happenings, especially when environment changes are taking place too frequently as in the case of information technology or fashion industries.” |