3.1.4

• What does PESTLE analysis stand for?

  Politics, Economic, Social, Technological, Legislation, Environmental
• What are the components of PESTLE analysis?

  • Politics
  • Economic
  • Social
  • Technological
  • Legislation
  • Environmental
• What does Porter's five forces theory aim to determine?

  The profitability of an industry
• How does Porter's five forces framework help businesses?

  It helps analyze the level of competition within a certain industry
• When is Porter's five forces analysis especially useful?

  When starting a new business or entering a new industry
• What does Porter's five forces suggest about competitiveness?

  Competitiveness doesn't only come from competitors
• What determines the state of competition in an industry according to Porter's five forces?

  The five basic forces
• How does the collective strength of the five forces affect profit in an industry?

  It determines profit in an industry and its attractiveness
• What happens to company returns if the five forces are intense?

  Almost no companies in the industry earn attractive returns on investments
• What is the implication if the five forces are mild?

  There is room for higher return