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Business Environment 71 policies, rapid technological (iii) Inter-relatedness: Different developments, political uncertainty, elements or parts of business changes in fashions and tastes environment are closely inter- of consumers and increased related. For example, increased competition in the market — all life expectancy of people and influence the working of a business increased awareness for health enterprise in important ways. care have increased the demand Increase in taxes by government for many health products and can make things expensive to buy. services like soft drinks, fat-free Technological improvements may cooking oil, and health resorts. render existing products obsolete. New health products and Political uncertainty may create fear services have, in turn, changed in the minds of investors. Changes in fashions and tastes of consumers people’s life styles. (iv) Dynamic nature: Business may shift demand in the market environment is dynamic in that from existing products to new it keeps on changing whether ones. Increased competition in the in terms of technological imp market may reduce profit margins rovement, shifts in consumer of firms. preferences or entry of new On the basis of the foregoing discussion, it can be said business competition in the market. environment, has the following (v) Uncertainty: Business envir onment is largely uncertain as it features: is very difficult to predict future (i) Totalityof external forces: happenings, especially when Business environment is the environment changes are taking sum total of all things external to business firms and, as such, place too frequently as in the is aggregative in nature. case of information tech nology (ii) Specificand general forces: or fashion industries. Business environment includes (vi) Complexity: Since business environment consists of both specific and general forces. numerous interrelated and Specific forces (such as investors, dynamic conditions or forces customers,competitorsandsupp liers) affect individual enterprises which arise from different directly and immediately in sources, it becomes difficult their day-to-day working. to comprehend at once what General forces (such as social, exactly constitutes a given political, legal and technological environment. In other words, environment is a complex conditions) have impact on all business enterprises and thus phenomenon that is relatively may affect an individual firm easier to understand in parts only indirectly. but difficult to grasp in its Reprint 2026-27