Question

Distinguish between the following.

Social Environment and Economic Environment.

Answer 1

Points		Social Environment	Economic Environment
(1) Meaning		Social environment includes customs, traditions, values, buying habits, tastes, etc.	Economic environment comprises of economic condition, economic policies and economic system.
(2) Factors		It includes factors such as social aspects, social trends, social values and traditions.	It includes factors like economic condition, economic policies and economic system.
(3) Supplement to		It is supplemented by cultural environment like cultural factors, values, beliefs, etc.	It is supplemented by political environment as it is influenced by political decisions or events taken by Government.
(4) Impact on business		It helps to analyze the changing social trends, taste of different social groups which helps businessmen to know the opportunities and threats.	Changes in economic policies like agricultural policy, monetary policy, etc. lead to changes in economic system and planning which helps businessmen to make changes on timely basis.
(5) Purpose		It helps to know the needs of customer and satisfy the demand E. g. Today health and fitness trend has created demand for products like gym, organic foods etc.	It helps in forecasting market situations and thereby making suitable business plans E.g. Stock market fluctuations affects management ' practices in a business Enterprise.
(6) Nature		It is dynamic n nature. Changes in trends, values; growing awareness among different social groups affects the social environment.	It is multi-dimensional in character. Agriculture, infrastructure, national, per capita income, price level etc. affects the economic environment of in a country.