UNIT - 1

INDIAN ENVIRONMENT
CHAPTER -- 1
What do you understand by business environment?
BUSINESS --Business is an enterprise which makes ,
distributes or provides any article or services which
other members of the community need and are able
to pay for .
ENVIRONMENT -- Environment of business consists
of all those external things to which it is exposed and
by which it may be influenced directly or indirectly .
NATURE AND CHARACTERISTICS OF BUSINESS
ENVIRONMENT
1. Internal and external environment
2. Dynamic factors
3. Environmental factors are interdependent
4. Uncontrollable factors
5. Basis of long term planning
6. Uncertain
7. Responsible for all factors
TYPES OF BUSINESS ENVIRONMENT
1. Internal environment (environment within
business )
2. External environment ( environment outside the
business )
BUSINESS FACTORS
( Factors which affects business directly or indirectly)
1. Internal (micro)
*Suppliers
*Customers
*Competitors
*Marketing intermidiaries
*Public
2. External (macro)
*Economic environment
*Demographic environment
*Socio cultural environment
*Natural environment
*Technological environment
*Political factors
*International environment
IMPORTANCE OF BUSINESS ENVIRONMENT
1. To understand the internal environment
2. To formulate long term planning
3. To get knowledge of opportunities , challenges ,
limitations
4. For the success and progress of business firm
5. Helpful in effective decision making
6. To establish co ordination with the environment
7. To get the knowledge of change
8. For technological upgradation
9. For the evaluation of objective and planning
10. For better productivity
11. Measurement of uncertainity or risk

# What is SWOT Analysis ? Explain in

details its main component .
SWOT Analysis is popularly used in strategic
management literature where 'S' is referred to
'strength' , 'W' as Weakness , 'O' as 'opportunities'
and 'T' as 'Threats' . SWOT Analysis is used by an
business enterprise to understand and analyse its
internal and external environment . Different
Individuals or Organisations identify their strength
and weaknesses and math them with opportunities
and threats lying in the external environment . this
analysis helps in formulating the plans and strategies
by which a firm have maximum profit by utilising
opportunities in the best possible way . It helps in
minimising business risks also .
 CHAPTER -- 2
NATIONAL INCIOME
# Define National Income and explain its
importance in a planned economy ?
According to professor A,C.Pigoce , " The National
dividend is that part of the community including of
course , income derived from abroad , which can be
measured in money .

METHODS OF MEASURING NATIONAL INCOME

1) Production method
2) Expenditure method
3) Income method

# Describe the trends of national income

and per capita income in India . Also
discuss the factors responsible for low
growth in national income .
Trends of national income and per capita income
during plans can be studied as under :
1) Growth in National Income
2) Increase in per capita income
3) Inequalities in the Distribution of Income
4) Change in the contribution of different economies
5) Regional inequalities
6) Trends in the share of public and private sector
7) Share of organised and unorganised sector

CHAPTER -- 3
SAVINGS AND INVESTMENT
# Meaning of savings
Savings refers to that part of money income which is
not spend on immediate consumption . Most of the
individuals do not spend the whole of the income
earned by then .
Therefore the which is not spend on consumption
becomes savings .
Thus , S = Y - C
S = Savings
Y = Income
C = Consumption