BUSINESS ENVIRONMENT
Business Environment
Amy Ballou
Professor Burke
12/05/2016
BUSINESS ENVIRONMENT 2
Introduction
Business does not operate in a vacuum but within an environment. They can be grouped into
three main categories which include: internal, external, and operational environments. These
factors collectively form business environment. Below is an elaborate explanation of how
economic, Political, legal, labour and financial affects international business operations.
Economic environment
The current state of the economy of a country can affect international business operations. The
rate of growth in the economy is a measure of the overall change in demand for goods and
services. Other economic factors that influence international business operations include taxation
levels, inflation rate, the balance of trade and exchange rates, the level of unemployment, interest
rates, and availability of credit. When it comes to government subsidies one should also look at
international economic issues, the extent of protectionist measures, comparative rates of growth,
inflation, wages and taxation, freedom of capital movement, and relative exchange rate which
