CAF-7 · Chapter 1 · Question 14 of 15
Which of the following scenarios best illustrates an entity reacting to a macro-environmental Economic factor?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) A firm delays its factory expansion project due to a sharp rise in the national inflation rate
Explanation
Inflation is a core macroeconomic factor. Delaying an expansion due to rising inflation perfectly illustrates an entity responding to an Economic factor in the PESTEL framework.
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