What external risks could affect ABC's market-driven strategies?

• A. Local rainfall patterns.
• B. Internal staff turnover.
• C. Global geopolitical risks and market volatility.
• D. Software license costs.

Answer: (C)

The main idea here is how external forces shape how a company designs and adjusts its strategies in response to the market. A market-driven approach relies on sensing and reacting to what customers and competitors are doing, along with broader economic and political conditions. Global geopolitical risks and market volatility fit this idea best because they directly influence demand, pricing, supply chains, and overall market confidence across multiple regions. When geopolitics shift or markets swing, consumer behavior can change quickly, exchange rates can alter competitiveness, and trade barriers or sanctions can disrupt inputs and distribution—all of which require a market-driven plan to adapt promptly.

Local rainfall patterns are environmental factors that can affect operations in certain industries, but they’re more about specific production conditions rather than the broad, external market dynamics that drive a market-driven strategy. Internal staff turnover and software license costs are internal risks and cost factors; they relate to how the company runs itself rather than external market signals that the strategy is built to respond to.