eco env't ppt

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CONTENTSCONTENTS

Introduction Introduction

Features of Economic Environment Features of Economic Environment

Elements of Economic Environment Elements of Economic Environment Economic Environment in India Economic Environment in India

International Economic Environment International Economic Environment

Interface between Business and Economic Environment Interface between Business and Economic Environment

Conclusion Conclusion

Bibliography Bibliography



I NTRODUCT IONI NTRODUCT ION

Environment :Environment :It means the surroundings , influences or It means the surroundings , influences or

circumstances under which someone or something circumstances under which someone or something exists .exists .

Business Environment :Business Environment :

It means the surrounding within which business It means the surrounding within which business exists and operates.exists and operates.



Business Environment

Internal Environment External Environment

Micro Environment Macro Environment

Suppliers

Costumers

Competitors

Marketing Intermediaries

Political Environment

Economic Environment

Social and Cultural Environment

Technological Environment

Regulatory Environment

Demographic Environment

Natural Environment

International Environment



Economic Environment Economic Environment Economic Environment refers to all Economic Environment refers to all

the forces , which have an economic the forces , which have an economic

impact on the business. The three impact on the business. The three major constituents of economic major constituents of economic

environment are economic environment are economic

conditions, economic polices and conditions, economic polices and

economic system.economic system.



Features of Economic Environment Features of Economic Environment

Dynamic Dynamic

Effect of various factors Effect of various factors

Related with economic activities Related with economic activities

Affected by non Affected by non- -economic factors economic factors Infrastructure Infrastructure

Role of government Role of government

Economic disparities Economic disparities

Public morality Public morality Effect of economic system Effect of economic system

Availability of capital Availability of capital



O bjectives of Study of Economic O bjectives of Study of Economic

Environment Environment Power Functioning of an economy Power Functioning of an economy

Knowledge of new opportunities and resources Knowledge of new opportunities and resources

Study of environmental factors Study of environmental factors Removal of obstacles and challenges Removal of obstacles and challenges

O ptimum use of resources O ptimum use of resources

Minimizing ill Minimizing ill- -effects effects



Elements of Economic Environment

Economic Conditions

Economic System

Economic Policies



Economic Conditions Economic Conditions O utput/Income O utput/Income

Economic Resources Economic Resources

National Income National Income

Per Per--capita Income capita Income

The Stage of Economic Development The Stage of Economic Development

Unemployment Rate Unemployment Rate

Inflation Rate Inflation Rate



Economic System Economic System 1.1. Capitalist Economies Capitalist Economies

Private ownership of means of production Private ownership of means of production

Profit motive Profit motive

Free market Economy Free market Economy

2.2. Socialist Economies Socialist Economies

Control and regulation of economic Control and regulation of economic activities by government activities by government

Welfare motive Welfare motive

Planned Economy Planned Economy

3.3. Mixed Economies Mixed Economies

Existence of public and private sector Existence of public and private sector

Features of both market economies and Features of both market economies and planned economies planned economies



Economic Policies Economic Policies

Monetary Policy Monetary Policy

Fiscal Policy Fiscal Policy

Export Export- -Import Policy (EXIM Policy) Import Policy (EXIM Policy) Foreign Investment Policy Foreign Investment Policy

Industrial Policy Industrial Policy



Economic Environment in India Economic Environment in India 1.1. Prior to 1991Prior to 1991

Unfavourable to private sector Unfavourable to private sector Foreign exchange crisis Foreign exchange crisis

Import restrictions Import restrictions

2.2. New Economic Policy 1991New Economic Policy 1991

Liberalisation Liberalisation

Privatisation Privatisation

Globalisation Globalisation

3.3. Developments Developments

Increase in Foreign Direct Investments Increase in Foreign Direct Investments

Increase in economic growth rate (7%Increase in economic growth rate (7%- -8%) 8%)

Entry of Multinationals and foreign firms ( Egs: Microsoft, Mc Donalds,Entry of Multinationals and foreign firms ( Egs: Microsoft, Mc Donalds,Kellogs) into India Kellogs) into India

Increased role of private sector Increased role of private sector

Considerable control of the government over the economy Considerable control of the government over the economy



International Economic Environment International Economic Environment International economic environment deals with international trade International economic environment deals with international trade

studies, determinants of goods and services flow across international studies, determinants of goods and services flow across international boundaries.boundaries.

International Finance is a macro International Finance is a macro- -economic field which examines the economic field which examines the flow of capital. flow of capital.

Increased trade in goods, services and capital between countries is a Increased trade in goods, services and capital between countries is a major effect of contemporary globalisation.major effect of contemporary globalisation.

Exchange rates and flow of money between countries.Exchange rates and flow of money between countries.



Interface between Business and Interface between Business and

Economic Environment Economic Environment

Business functioning is influenced Business functioning is influenced by the economic system, economic by the economic system, economic

policies and economic conditions policies and economic conditions prevailing in the country. prevailing in the country.

Business organisations can also Business organisations can also influence economic policies of the influence economic policies of the government by forming pools, government by forming pools,cartels etc.cartels etc.



Conclusion Conclusion

Economic environment is a very Economic environment is a very important dimension of the business important dimension of the business environment. The various aspects of environment. The various aspects of economic environment have a great economic environment have a great influence on the functioning of a influence on the functioning of a

business enterprise. Similarly even a business enterprise. Similarly even a business firm influences its environment.business firm influences its environment.International economic environment is International economic environment is

also a very important aspect. Thus also a very important aspect. Thus economic environment is a significant economic environment is a significant

area which determines the economic area which determines the economic growth, economic conditions, economic growth, economic conditions, economic

policies and economic reforms. policies and economic reforms.



BIBLIOGRAPHY BIBLIOGRAPHY

Websites:Websites:

www.google.com www.google.com

www.gurukpo.com www.gurukpo.com www.managementparadise.com www.managementparadise.com

Books:Books:

Business Development (F.Y.B.Com.) by Dr. Parag Business Development (F.Y.B.Com.) by Dr. Parag Ajagaonkar and Anjali Patkar Ajagaonkar and Anjali Patkar ² ² Sheth Publishers Sheth Publishers

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