Master Chapter 3 – Business Environment with Our MCQ-Based Mock Test!

Do you understand how changing government policies, social trends, and global factors affect businesses?
Find out with this MCQ-Based Mock Test on “Business Environment”, designed specially for Class 12 Business Studies students as per the latest CBSE syllabus (2025–26).

This test covers every important concept — from the meaning and importance of business environment to the dimensions (economic, social, technological, political, and legal) and the impact of government policy changes like LPG (Liberalisation, Privatisation, and Globalisation) on business.

Why Attempt This Mock Test?
Includes conceptual, competency, and case-based MCQs
Covers all NCERT-based and exam-relevant topics
Enhances understanding of real-world business scenarios
Provides instant feedback for self-evaluation
Ideal for revision before class tests and board exams

Practice effectively, gain clarity, and stay ahead of the competition!
Start your Chapter 3: Business Environment MCQ Mock Test now and take your BST preparation to the next level.

1. __________ is the process of analysing the environment for the identification of factors which have impact on or have implication for the business.

 
 
 
 

2. Several initiatives have been undertaken by the Government of India to encourage domestic manufacturing and export of defence equipments. ‘Make In India’ in Defence, was one such scheme launched by the Government to encourage companies across the world to manufacture defence products in India. To which dimension of business environment does the above case relates to ?

 
 
 
 

3. The sum total of all individuals, institutions and other forces that are outside the control of a business enterprise but that may affect its performance is known as ___________.

 
 
 
 

4. Identify the concept illustrated by the picture given below.

 
 
 
 

5. Which one of the following is not an objective of demonetisation?

 
 
 
 

6. Demand for reservation in jobs for minorities refers to the ___________ component of general environment of business.

 
 
 
 

7.

“Schedule H1 Drug-Warning:
• It is dangerous to take this preparation except in accordance with the medical advice.
• Not to be sold by retail without the prescription of a Registered Medical Practitioner.” It is mandatory to be written on medicines.
Which dimension of business environment is highlighted in the given case?
 
 
 
 

8.

Digi Locker is the country’s first secured cloud-based platform for the storage, issuance and verification of documents with the Driving License and Vehicle Registration System of the Road Transport Ministry. The integration of a government department with Digi Locker since its launch last year is one of the biggest of its kind. It will spare people the trouble of carrying licenses and vehicle papers, which can be accessed on phones using the Digi Locker app.
Identify the related dimension of business environment indicated here.
 
 
 
 

9. Aiming to revive Jammu and Kashmir’s attraction as a top location for film shooting the J&K film policy, 2021 offers a host of incentives to the filmmakers, such as subsidies and low long term interest rates, for films with patriotic and certain other themes shot in J&K, for giving work opportunities to local artists, etc. This will have an impact on business enterprises in the state.
Which component of business environment is highlighted above?

 
 
 
 

10. The income and expenditure policy of the government is called ___________.

 
 
 
 

11. Economic growth can be measured by ___________.

 
 
 
 

12. Population is a component of the total ___________ environment, while composition of population is component of ___________ environment.

 
 
 
 

13. As part of regulations to be followed by advertisers, the advertisement for a new brand of baby food for infants provides important information for potential buyers that it is “Not recommended for infants under the age of four months”. Which dimension of the business environment is highlighted in the above statement?

 
 
 
 

14. Which factor is not included in Internal Environment?

 
 
 
 

15.

Identify the dimension of business environment illustrated by the picture given below in which the business organisations now have numerous virtual meetings, conferences and discussions.
 
 
 
 

16. Name the concept which explains the manner in which decision making responsibilities are divided among hierarchical levels.

 
 
 
 

17.

Radiance Paint Company, which is manufacturing paints has been enjoying a prominent market position as it manufactures best quality paints and
made timely payment of taxes to the government. It assembles various inputs like finance, machines, raw materials, etc. from its business environment. But since last year, it has been dumping its untreated poisonous waste on the river bank which has created many health problems for the people. As a result, the court has passed an order to seal the manufacturing unit of the company.
Identify the importance of business environment highlighted in the above case.
 
 
 
 

18.

Plastic utensils are often used as a low cost, convenient option for business or personal use. These utensils are lightweight, easy to transport and can be disposed off easily instead of cleaned and reused. But plastic utensils are harmful from health point of view and create various environmental issues. Now-a-days health and fitness trend is becoming popular. People are looking for different alternatives and have started
opting for paper-made, steel or glass utensils which has tremendously increased the demand of these products.
The above para discusses an important dimension of Business Environment which is:
 
 
 
 

19. Under ___________ the Reserve Bank keeps control on the money supply in order to achieve the objectives of the general economic policy.

 
 
 
 

20. Which of the following is an element of political environment?

 
 
 
 

21. The demonetisation move of the government has resulted in the accumulation of crores of rupees in the banks. Now, the banks will give more loans to the people at lower interest rate. General public can now afford home loans more easily.

Identify the dimension of business environment highlighted in the given case.
 
 
 
 

22. In which of the following categories can business environment be divided?

 
 
 
 

23. Identify the dimension of business environment depicted in the picture given below:

 
 
 
 

24. Any kind of external devices, like compact discs (CD’s) for computer, have become obsolete. Google, with its Google Drive service, Apple with its  iCloud offering, enables the users to store documents, photos, music and movies on web-based servers. Identify the feature of the business environment being described in the above case.

 
 
 
 

25. “Amul has launched Panchamrit, a mix of five ingredients which is usually offered in temples as ‘prasad’, as hygiene becomes a focal point amid corona virus pandemic.” Which importance of business environment is highlighted here?

 
 
 
 

26. Identify the impact of demonetisation aptly depicted below:

 
 
 
 

27. ___________ environment is within the control of business.

 
 
 
 

28. Different kinds of factors present in the business environment impact a business. Therefore, it becomes tough for a running business to know the extent of the relative impact of different factors like social, technological, economic, etc. on change in demand for a product available in the market.

Select an appropriate option out of the following features of business environment highlighted in the given case.
 
 
 
 

29. As the pandemic hit the MSME sector of India, many organisations had to face challenges and struggle during the period. One such organisation, Steel Bird helmets quickly transformed their helmets into face shields.

Which importance of business environment is being highlighted in the above case?
 
 
 
 

30. Which of the following statements is incorrect?

 
 
 
 

Question 1 of 30