CAF-7 · Chapter 1 · Question 1 of 15
A country's government has recently introduced a policy to provide heavy subsidies to companies operating in the renewable energy sector, while simultaneously increasing taxes on fossil fuel imports. Under PESTEL analysis, how should a solar panel manufacturing company classify this development?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Political factor, because it relates to government policy and taxation intervention
Explanation
Government interventions, including subsidies, tax policies, and tariffs designed to support or suppress specific industries, are classified as Political factors in the PESTEL framework.
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