Business environment refers to those aspects of the surroundings of business enterprise which affect or influence its operations and determine its effectiveness. The business environment is always changing and is uncertain. It is because of this that it is said that the business environment is the sum of all the factors outside the control of management of a company those are depended to each other—the factors which are constantly changing and they carry with them both opportunities and risks or uncertainties which can make or mar the future of business.

Time Series

• The arrangement of data in accordance with their time of occurrence is a time series.
• It is the chronological arrangement of data. 
• A time series depicts the relationship between two variables. 

Mathematical Model for Time Series Analysis

1. Additive Model for Time Series Analysis
   • If yt is the time series value at time t. Tt, St, Ct, and Rt are the trend value, seasonal, cyclic and random fluctuations at time t respectively. According to the Additive Model, a time series can be expressed as
   • yt = Tt + St + Ct + Rt.
   • This model assumes that all four components of the time series act independently of each other.
2. Multiplicative Model for Time Series Analysis
   • The multiplicative model assumes that the various components in a time series operate proportionately to each other. According to this model
   • yt = Tt × St × Ct × Rt
   • Multiplicative model is used when all four components of the time series act dependently of each other as in case of Economy and Business.