Which external environment component includes factors such as the use of artificial intelligence and ChatGPT to help managers make better decisions?

• A. Economic
• B. Technological
• C. Social
• D. Political

Answer: (A)

The technological environment includes advances in information technology and the tools managers use to analyze data and make decisions. Artificial intelligence and ChatGPT are clear examples of this, because they are technologies that augment cognitive work—helping with data processing, pattern recognition, forecasting, and decision support. These innovations change what information is available, how quickly decisions can be made, and the quality of those decisions, all of which are central to the technology component of the external environment. In contrast, the economic environment deals with markets and resource conditions, the social environment with demographics and cultural norms, and the political environment with laws and regulations. So the use of AI and ChatGPT to aid decision making fits best with the technological environment.