Question

External environments that affect the ways in which firms operate internationally include physical, societal, and competitive factors.

Situations that call for understanding the interpersonal norms of people in foreign countries and the reasons why operating procedures may need to be adjusted in foreign locales, fall under the general category of ______.

1.Behavioral factors

2. Geographic influences

3. Legal policies

4. Political policies

5. Economic forces

Answer 1

Answer: Option 1) Behavioral Factors

Behavioral Factors are the values, habits, interpersonal activities, social behaviour, etc. Every country has different behaviour. Interpersonal norms of people in foreign country are needed to be understood because that allow the firm to better serve the locals. For example, countries have different sports craze, eating habits so if you are a sports goods manufacturer, then you need to understand the foreign country's sports culture before entering in that market or if you are a food company then you need to adjust your product to local taste. So the answer is behavioral Factors.

The other options are wrong because:

Geographic influence means country's geographic conditions such as climate effect on the firm.

Legal policies are related to laws and regulations of different foreign countries.

Political policies are related to country's political climate i.e., ruling party's viewpoint towards trade or political stability.

Economic factors are related to the economic development of country, currency value, GDP, etc.