A situation analysis requires a firm to consider the external forces and trends that affect it, either favorable or unfavorable. Which scenario is an example of an external force?
A) The firm buys its own fleet of trucks, so it no longer needs to hire a trucking company for distribution.
B) A hiring freeze is put into place. Although no one is fired, no one can be hired.
C) A goal is set to decrease production costs with new equipment.
D) A city government bans plastic straws inside all restaurants and bars in the city limits.
E) Shareholders are rewarded with a sizable dividend check.

Question

Quizplus · Accepted Answer

A city government banning plastic straws is an external force as it is a regulatory change that affects the firm from outside its control.

A Situation Analysis Requires a Firm to Consider the External