Over the last few years, Ankit Motors has seen three kinds of change in its market: buyers now prefer electric scooters, a new type of battery has been developed, and two new companies have started selling scooters. Which feature of the business environment does this show?
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → Dynamic nature
Option (1) Uncertainty — Incorrect. Uncertainty means future happenings are very difficult to predict. The case tells of changes that have already taken place.
Option (2) Inter-relatedness — Incorrect. Inter-relatedness means a change in one part brings about a change in another. The case does not show one change leading to another; it shows the market changing in three ways.
Option (3) Relativity — Incorrect. Relativity means the environment differs from country to country and region to region. The case is about changes in one firm’s market over time, not a comparison between countries or regions.
Option (4) Dynamic nature — Correct. Dynamic nature means the business environment keeps on changing. The case shows all three kinds of change: shifts in consumer preferences (electric scooters), technological improvement (a new battery) and entry of new competition (two new companies).
NCERT (2026-27 Edition): “(iii) Inter-relatedness: Different elements or parts of business environment are closely interrelated. For example, increased life expectancy of people and increased awareness for health care have increased the demand for many health products and services like soft drinks, fat-free cooking oil, and health resorts. New health products and services have, in turn, changed people’s life styles.” “(iv) Dynamic nature: Business environment is dynamic in that it keeps on changing whether in terms of technological improvement, shifts in consumer preferences or entry of new competition in the market.” “(v) 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. …” “(vii) Relativity: Business environment is a relative concept since it differs from country to country and even region to region. Political conditions in the USA, for instance, differ from those in China or Pakistan. Similarly, demand for sarees may be fairly high in India whereas it may be almost non-existent in France.” |