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ii. Differentiate between internal and external environment.

The differences between internal and external environment is
Internal environment involve within the organization, which are the employee attitudes,new
equipment,strategy,work forces.The organization has the control of these matters because it
happen within the organization unless like external environment and for the external
environment,is clearly stated with the word external itself which means outside of the
organizations which effect the changes in the organization which the organization does not
have the control of it.External environment are involved by the PESTLE- Politic, Economy,
Social, Technology, Legal and Environment.

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iii. What is the significance of business environment?
Business Environment refers to the Sum total of conditions which surround man at a given
point in space and time. In the past, the environment of man consisted of only the physical
aspects of the planet Earth (air, water and land) and the biotic communities. But in due
course of time and advancement of society, man extended his environment through his
social, economic and political function.
In a globalised economy, the business environment plays an important role in almost all
business enterprises. The significance of business environment is explained with the help of
the following points:
(i) Help to understand internal Environment:
(ii) Help to Understand Economic System:
(iii) Help to Understand Economic Policy:
(iv) Help to Understand Market Conditions:

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iv. Explain briefly the instruments of monetary policy.
Instruments of Monetary Policy:

The instruments of monetary policy are of two types: first, quantitative, general or indirect;
and second, qualitative, selective or direct. They affect the level of aggregate demand
through the supply of money, cost of money and availability of credit. Of the two types of
instruments, the first category includes bank rate variations, open market operations and
changing reserve requirements. They are meant to regulate the overall level of credit in the
economy through commercial banks. The selective credit controls aim at controlling specific
types of credit. They include changing margin requirements and regulation of consumer
credit. The main instruments of monetary policy.
A. Bank Rate Policy.
B. Open Market Operations.
C .reglation of cash reserve.
D. Selective Credit Controls.
E .issue of currency notes.

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v. Highlight the role of WTO
The Role of the World Trade Organization
The World Trade Organization (WTO) is one of the three international organisations (the
other two are the International Monetary Fund and the World Bank Group) which by and
large formulate and co-ordinate world economic policy.
It can be argued that the WTO plays a particularly significant role in the promotion of free
international trade. The organisation acts as an umbrella institution, that is an organisation
covering the agreements concluded at the Uruguay Round. The Uruguay Round was the
preparatory stage for the launch of the WTO. The Round was based on the General
Agreement on Tariffs and Trade (GATT).
The crucial role of the WTO is to provide a common institutional framework for the
implementation of those agreements. The organisation is the result of the Uruguay Round of
negotiations (1986-1994) and was formally created in 1995.

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viii. Dicuss briefly the importance of public sector in Indian
economy.
Following are the important roles of public sector in indian economy.
1 Capital formation

2 development of insfrastructure.
3 development of defence industries.
4 development of basic and key industries : iron and steel,cement.etc
5 development of power project.
6 development of banking and insurance.
7 balanced regional development .
8 balanced economic growth.
9 strong industrial base.

14 Expansion of employment opportunities.

10 economies of scale.

15 source of revenue to the government.

11 removal of regional disparities.

16 saving in foreign exchange.

12 import promotions

17 diversity of project.

13 better allocation and utilization of resources

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ix. What are the basic features of EXIM policy?

Exim Policy, also known as the Foreign Trade Policy is announced every 5 years by Ministry
of Commerce and Industry, Government of India. It is updated every year on the 31st of
March and all the amendments and improvements in the scheme are effective from the 1st of
April. Exim policy deals in general provisions pertaining to exports and imports, promotional
measures, duty exemption schemes, export promotion schemes, special economic zone
programs and other details for different sectors. The Government announces a supplement
to this policy each year. The Government of India also releases the Hand Book of
Procedures detailing the procedures to be followed for each of the schemes mentioned in
the Exim Policy.