a) List four elements that make up the external environment of business b) State two responsibilities each that a business owes the following: Customers; Em...

Answer Details

(a) Four elements of the external environment of business

1. Economic environment (level of income, inflation, interest rates, taxation and general economic conditions).
2. Political and legal environment (government policies, laws, regulations and political stability).
3. Social and cultural environment (people's values, customs, tastes, beliefs and population).
4. Technological environment (state of technology, machinery, tools and methods of production).

(Also acceptable: the natural/physical environment, competitors, suppliers, and international environment.)

(b) Two responsibilities each that a business owes to the following:

Customers

1. To supply good-quality, safe and genuine goods and services at fair prices.
2. To give honest information and after-sales service, and to honour guarantees.

Employees

1. To pay fair and prompt wages and provide good working conditions.
2. To ensure safety at work, job security and opportunities for training and promotion.

Investors

1. To use their capital wisely and pay reasonable returns (dividends/interest).
2. To keep accurate accounts and give truthful, regular information about the business.

Society

1. To avoid pollution and protect the environment.
2. To provide employment and contribute to community welfare, and pay taxes honestly.