A business firm's interaction with the environment is a characteristic of an open system.

Question

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An open system is characterized by the constant interaction of a business firm with both its internal and external environment. This interaction allows the system to receive inputs (such as raw materials, financial resources, and human resources) from the environment and transform them into outputs (such as goods, services, and profits) that are sent back to the environment. Therefore, a business firm's interaction with the environment is a key feature of an open system.

A Business Firm's Interaction with the Environment Is a Characteristic