Business and its Environment

Syllabus tag: KCSE | Business Studies | Form 1 | Topic 2 Business Environment

Lesson objectives

By the end of this topic, you should be able to:

• State the purpose of a business and the types of business activity.
• Distinguish the internal from the external business environment.
• Describe the elements of each and their effects on a business.
• Explain how a business responds to environmental change.

Summary

A business operates within an environment that is internal — structure, resources, technology, culture and the owner, largely controllable — or external — economic, demographic, legal, technological, cultural, competitive and physical, largely uncontrollable. The internal environment supplies strengths and weaknesses; the external supplies opportunities and threats.