Which of the following represents an external factor that can influence purchase decisions?

Economic conditions are indeed a crucial external factor influencing purchase decisions. They encompass a broad range of elements, such as inflation rates, unemployment levels, consumer confidence, and overall economic growth or recession. These conditions directly affect consumers’ disposable incomes and spending behavior. For instance, in a thriving economy, consumers feel more secure in their financial situations and are likely to increase their spending, while during economic downturns, they tend to tighten their budgets and may prioritize essential purchases over discretionary spending.

In contrast, company policies are internal factors as they reflect the internal governance of a business. Previous experiences are also internal as they relate to past interactions an individual or organization has had with a product or brand. Employee motivation primarily deals with the internal dynamics within an organization and does not typically influence external purchase decisions. Therefore, economic conditions serve as an external influence, significantly shaping consumer behavior and buying choices.