ABSTRACT
This chapter deals with the objectives of economics within the framework of the business environment. It shows that business environment with these objectives in mind. Political developments in market areas, technical innovations, and major shifts in customer demand and changes in work ethics all have a major effect on companies. The chapter describes the relationship between absolute and relative changes in variables. The importance of the absolute change in economic variables will always be manifestly evident. Economic activity occurs when people (consumers, managers) make choices to maximise their prosperity using scarce resources. The science of economics is concerned with the study of economic activity. The term ‘business environment’ covers all the changes in the environment of a business that can have an effect on the company results. Three types of environment can be identified. They are direct environment, indirect environment and macroenvironment. The chapter also presents an overview of the key concepts discussed in this book.
