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1. Which of the following is an example of a business
environment factor that affects the strategic planning of a
company?
a) The level of competition in the industry
b) The availability of skilled labor in the market
c) The interest rate charged by banks for loans
d) The preferences and tastes of customers
Answer: A. The level of competition in the industry is an
external factor that influences the strategic planning of a
company, as it affects the profitability, market share, and
growth potential of the company. The other options are
examples of operational, financial, and marketing factors,
respectively, that affect the tactical and operational
planning of a company.
2. Which of the following is a characteristic of a perfectly
competitive market?
a) There are many buyers and sellers of homogeneous
products
b) There are significant barriers to entry and exit
c) There is a high degree of product differentiation and
innovation
d) There is a single seller who sets the price and quantity
Answer: A. A perfectly competitive market is one where
there are many buyers and sellers of homogeneous
products, meaning that the products are identical and
indistinguishable. There are no barriers to entry and exit,
meaning that new firms can enter and exit the market
easily. There is no product differentiation or innovation,ÂÂ
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