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Question
Distinguish between the following.
Political Environment and Legal Environment.
Solution
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Points |
Political Environment |
Legal Environment. |
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1. Meaning |
In a country, the political system, constitutional provision, party system, events taking place time to time determine the political environment. |
In a Country, a business can be started, regulated, controlled, expanded within the legal framework of a country determines the legal environment. |
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2. Factors |
Political stability, peace in the country, specific attitudes of an elected representative, etc. are the factors which affects the political environment. |
Various laws are implemented from time to time with amendments in order to control and direct the business. |
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3. Interrelation between environment |
The political environment and economic environment are closely connected with each other. |
The legal environment and regulatory environment go together hand-in-hand in the modern business environment. |
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4. Impact on business |
The ideology of the political parties influences the business organization. |
Provides control, direction, expansion to the business organization. |
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5. Purpose |
Political stability creates strength, confidence to various interest groups and investors in long term projects. |
Separate laws implemented from time to time to safeguard and protect the interest of various groups such as business organization, workers, consumers, etc. |
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6.Effect of changes in the environment |
Political instability affects the business organization adversely. Business policies are amended due to political issues, events, etc. prevailing in the country. |
Excessive controls, implementation of laws, rules, and regulations may create problems in overall development of business organizations. |
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