Question

Factors of internal environment of business are

• A. Land
• B. Capital
• C. Production
• D. All of these

Hint:

Remember, the internal environment is everything 'inside' the company that it can largely control. The external environment (e.g., government policies, competitors, economic trends) is 'outside' and largely beyond its control.

Answer 1

The Correct Option is D

Step 1: Understanding the Question:
The question asks to identify factors that are part of the internal environment of a business. The business environment is divided into internal and external factors. The internal environment consists of factors within the organization that can be controlled or influenced by it.
Step 2: Key Concept:
Internal factors typically include the firm's resources (financial, physical, human), objectives, management structure, and corporate culture. These are often summarized as the 5 Ms: Men, Money, Machinery, Materials, and Methods.
Step 3: Analysis of Options:
Let's analyze the given options in the context of the internal environment.

(A) Land: Land on which the business operates is a physical resource or asset owned and controlled by the business. It is an internal factor.

(B) Capital: The financial resources available to the business are a key internal factor. Management decides how to raise and allocate this capital.

(C) Production: The production function, including its capacity, technology, and processes, is entirely within the control of the business and is a core part of its internal operations.

Since Land, Capital, and Production are all resources and functions managed within the company, they are all components of its internal environment.
Step 4: Final Answer:
Therefore, the correct answer is (D) All of these.