Question

Which of the following is not an example of a firm's macroenvironment?

-demographics

-political/legal issues

-culture

-competition

Answer 1

Answer -

Option (4) competition is correct.

Explanation -

Macro environmental factors are those factors which are external to the business.

Given demographics, political / legal issues and cultural factors does not directly affect the internal business environment and thus are external factors.

But competition directly affects the internal policies of business like marketing, production, satisfaction of consumers etc. i.e. in regard to the competitors in business, one has to make changes in all these for achieving more market share. This directly affects the profitability of the business.

Therefore competition is not an example of firm's macro environment.