The economic environment of business has reference to the broad characteristics of the economic system in which the business firm operates. The economic environment of the country includes economic system, macroeconomic parameters, and stages of the business cycle, financial system and economic policies of the government.
The non-economic environment includes political system, government policies, legal framework social system, cultural values, demographic factors, technological development and natural environment of the country.
The non-economic environment exercises a strong influence on the business. Normally the non-economic environmental factors are the key factors for all kinds of business activities in India.
