Question

1. A business's competitive environment describes:

A. how a business competes for critical resources.

B. how a business makes its product.

C. how a business uses its business model to create a competitive advantage.

D. how a business is affected by the overall economy.

The net working capital for a company with current assets of $ 68,000, quick assets of $ 30,000 total assets of $ 160,000, current liabilities of $ 47,000 and net sales of $ 76,000 would be:

A. $21,000.

B. $98,000.

C. $45,000.

D. $51,000.

Answer 1

1. A business's Competitive Environment describes how the business compete for critical resources. Competitive environment include both direct and Indirect competition and direct competiton competes with you for the excat same customers and limited resources avilable in the market but in the indirect competiton they will mostly go afte one induatry key factors such net extra income of the customers like both car manufacturing comapny and Tours & travells company they dont compete directly but they are competing for the net avaliable income of the consumers. That makes it difficult for the company to gain the resources they need because of the competition in the market. Critical resorces can be anything like raw material, customers or net income. Therefor, A business's competitive environment describes how a busniess compete for critical resources with others in the market.

2. Net working capital is the difference between the current assets and the current liabilities. Net working capital shows that the company have enough money to fullfill its current obligations as well as invest more money else where to earn more money.

Net Working Capital= Current Assest - Current Liabilities

=$68000-$47000

=$21000 Therefore the net working capital is $21000

therefore the option C Is right.