MEWAR UNIVERSITY

CLASS & SECTION:B.TECH IV Yr.(VIIth SEM)

SUB:-ENTREPRENEURSHIP

UNIT – I

1. Entrepreneurship can best be described as _________ Ans. - D

A. a process that requires setting up a business.
B. taking a significant risk in a business context.
C. . having a strong vision.
D. a process involving innovation, new products or services, and value creation

2. Which of these statements best describes the context for entrepreneurship Ans. - C
A. Entrepreneurship takes place in small businesses.
B. Entrepreneurship takes place in large businesses
C. Entrepreneurship takes place in a wide variety of contexts.
D. Entrepreneurship does not take place in social enterprises

3. Innovation can best be defined as_______ Ans. - D

A. the generation of new ideas.
B. the evolution of new ideas.
C. the opposite of creativity.
D. the successful exploitation of new ideas.

4. Which of the following statements most accurately describes innovation Ans. - D

A. Innovation is an absolute not a relative concept
B. Innovation is easy to measure.
C. Innovation is much more important to small busineses than to large businesses.
D. Innovation is a relative not an absolute concept.

5. Which of the following shows the process of creating something new? Ans. - C
A. Business model
B. Modeling
C. Innovation
D. Creative flexibility

6. An individual who initiates, creates and manages a new business can be called_______ Ans. - D
A. A leader.
B. A manager.
C. A professional.
D. An entrepreneur

7. A person owning and running a small firm, is known as________ Ans. - B

A. A manager-owner.
B. An owner-manager .
C. A professional adapter.
D. An enterprise worker.
8. Someone who improves an existing business can be called _________ Ans. - A
A. An intrapreneur
B. A professional
C. A co-worker.
D. A changeling.

9. An individual who initiates, creates and manages a new business can be called_______ Ans. - D
A. A leader.
B. A manager.
C. A professional.
D. An entrepreneur

10. A person owning and running a small firm, is known as________ Ans. - B
A. A manager-owner.
B. An owner-manager .
C. A professional adapter.
D. An enterprise worker.

11. Someone who improves an existing business can be called _________ Ans. - A
A. An intrapreneur
B. A professional
C. A co-worker.
D. A changeling.

12. Why are small businesses important to a country s economy Ans. - D

A. They give an outlet for entrepreneurs.
B. They can provide specialist support to larger companies.
C. They can be innovators of new products.
D. All the above.

13. Which of the following is the reason for business failure __________ Ans. - D
A. Lack of market research.
B. Poor financial control.
C. Poor management.
D. All the above.

14. Which of these statements best describes the context for entrepreneurship Ans. - C
A. Entrepreneurship takes place in small businesses.
B. Entrepreneurship takes place in large businesses
C. Entrepreneurship takes place in a wide variety of contexts.
D. Entrepreneurship does not take place in social enterprises

15. Entrepreneurs are motivated by _________ Ans. - D

A. money.
B. personal values
C. pull influences.
D. All the above.

16. Innovation can best be defined as_______ Ans. - D

A. the generation of new ideas.
B. the evolution of new ideas.
C. the opposite of creativity.
D. the successful exploitation of new ideas.

17. Which of the following statements most accurately describes innovation Ans. - D
A. Innovation is an absolute not a relative concept
B. Innovation is easy to measure.
C. Innovation is much more important to small busineses than to large businesses.
D. Innovation is a relative not an absolute concept.

18. The purpose of all good small business strategy is__________ Ans. - D
A. to increase turnover.
B. to increase profitability.
C. to achieve competitive advantage
D. . to achieve stated objectives.

19. Which one of the following actions by an entrepreneur is most likely to contribute to creative destruction?
A) Development of a new product Ans. - A
B) Take-over of a competitor
C) Issuing shares
D) Reducing prices

20. An advantage of the small firm in the innovation process? Ans. - D

A) Ability to carry out R&D
B) Ability to raise finance
C) Ability of the entrepreneur to carry out multiple tasks
D) Ability of the entrepreneur to act on new ideas or product development

21.External links may provide incentives to: Ans. - C

A) Raise finance
B) Introduce new working practices
C) Introduce improvements to products
D) Attend business exhibitions

22. Firms located on science parks compared to those located off science parks are: Ans. - C
A) More innovative
B) Less innovative
C) No more or less innovative
D) More growth orientated

23. Innovative small firms are more likely in: Ans. - A

A) Knowledge-based sectors
B) Biotechnology
C) Automobile manufacture
D) Aerospace manufacture

24. Schumpeter considered that innovative entrepreneurs would: Ans. - C

A) Thrive
B) Disappear
C) Be absorbed within large innovative firms
D) Be absorbed within non-innovative firms
25. Innovative entrepreneurs face special issues in raising: Ans. - D
A) Development capital
B) Structured capital
C) Human capital
D) Seed capital

26. Innovative entrepreneurs may have to pay high insurance premiums due to the: Ans. - A
A) The need to protect patents
B) Greater employee liability
C) Greater customer liability
D) Greater trading risks

27. Networking by innovative entrepreneurs may be most encouraged by? Ans. - B

A) Science parks
B) Business incubators
C) Chambers of Commerce
D) Business associations

28. The most likely problem encountered by innovative entrepreneurs in raising finance is: Ans. - C
A) Limited security since R&D is an intangible asset
B) The costs of the patenting system
C) The exhaustion of personal equity in R&D
D) Inability of potential external funders to understand technology

29. All of the following are characteristics of small businesses EXCEPT: Ans. - C
A) Small businesses are independently owned, operated, and financed.
B) Small businesses have fewer than 100 employees.
C) Small businesses emphasize new or innovative practices.
D) Small businesses have little impact on industry.

30. Which of the following is NOT on of the three areas in which the importance of entrepreneurship can be
shown? Ans. - D
A) Innovation
B) Number of new start-ups
C) Job creation and employment
D) bureaucracy

31. An individual who initiates, creates and manages a new business can be called_______ Ans. - D
A. A leader.
B. . A manager.
C. A professional.
D. An entrepreneur

32. A person owning and running a small firm, is known as________ Ans. - B
A. . A manager-owner.
B. An owner-manager .
C. A professional adapter.
D. An enterprise worker.

33. Someone who improves an existing business can be called _________ Ans. - A
A. An intrapreneur
B. A professional
C. A co-worker.
D. A changeling.

34. Where individual skills are collectively integrated into a group, this is known as __ Ans. - C
A. Collective entrepreneurship
B. Intrapreneurship.
C. Team entrepreneurship
D. Dual innovation.

35. Which of the following government actions could contribute to a more entrepreneurial society Ans. - D
A. Deregulation.
B. Financial start-up.
C. Information and advice
D. All the above.

36. Which industrial sector tends to naturally promote small-scale businesses and entrepreneurship, and
generally has lower barriers to market entry Ans. - A
A. Service.
B. Manufacturing.
C. Distribution.
D. Agriculture.

37. Where there is no legal separation between the assets and liabilities of a business, and the assets and
liabilities of an individual, the business is _________ Ans. - A
A. A sole trader.
B. A limited company
C. A cooperative.
D. A partnership.

38. Which of the following is the reason for business failure __________ Ans. - D
A. Lack of market research.
B. Poor financial control.
C. Poor management.
D. All the above.

39. Which one of the following describes unemployment Ans. - B

A. The number of people who voluntarily choose not to work.
B. The number of people who are jobless and are actively seekin work
C. The number of people who are not actively seekin work.
D. The number of people actively seeking work who find work.

40. Entrepreneurship can best be described as _________ Ans. - D

A. a process that requires setting up a business.
B. taking a significant risk in a business context.
C. having a strong vision.
D. a process involving innovation, new products or services, and value creation

41. Which of these statements best describes the context for entrepreneurship Ans. - C
A. Entrepreneurship takes place in small businesses.
B. Entrepreneurship takes place in large businesses
C. Entrepreneurship takes place in a wide variety of contexts.
D. Entrepreneurship does not take place in social enterprises
42. Entrepreneurs are motivated by _________ Ans. - D
A. money.
B. personal values
C. pull influences.
D. All the above.

43. Innovation can best be defined as_______ Ans. - D

A. the generation of new ideas.
B. the evolution of new ideas.
C. the opposite of creativity.
D. the successful exploitation of new ideas.

44. Which of the following statements most accurately describes innovation Ans. - D
A. Innovation is an absolute not a relative concept
B. Innovation is easy to measure.
C. Innovation is much more important to small busineses than to large businesses.
D. Innovation is a relative not an absolute concept.

45. Decisions taken by an entrepreneur on behalf of his enterprise are known as _________ Ans. - A
A. Organizational decisions.
B. Personal decisions.
C. Routine decisions.
D. Strategic decisions

46. Decisions taken by an entrepreneur for himself and not on behalf of the firm are known as _________
A. Organizational decisions. Ans. - B
B. Personal decisions.
C. Routine decisions
D. Strategic decisions.

47. Decisions which are taken repetitively in accordance to the day to day operations of the organizations are
called as __________ Ans. - C
A. Organizational decisions
B. Personal decisions.
C. Routine decisions.
D. Strategic decisions.

48. Decisions which are concerned with policy matters and exercise fundamental influence on the objectives of
the organization are called as____________ Ans. - D
A. Organizational decisions.
B. Personal decisions.
C. Routine decisions.
D. Strategic decisions.

49. Decisions which are concerned with systematic procedures are called as _________ Ans. - A
A. Programmed decisions.
B. Non programmed decisions.
C. Routine decisions.
D. Strategic decisions.

50. Decisions which are non-repetitive and novel nature and required to solve unstructured problem is called as
A. Programmed decisions. Ans. - B
B. Non programmed decisions.
C. Routine decisions.
D. Strategic decisions.

UNIT - II

1. Companies identify their assets with the date of purchase, because it can be helpful in determining
depreciation for: Ans. - C

A. Goodwill

B. Trade rebate

C. Tax purposes

D. Capital structuring

2. Why should an entrepreneur do a feasibility study for starting a new venture? Ans. - A

A. To see if there are possible barriers to success

B. To identify possible sources of funds

C. To estimate the expected sales

D. To explore potential customers

3. Which of the following are the key factors for choosing the type of financing? Ans. - D

A. Availability of funds

B. Assets of the venture

C. Prevailing interest rates

D. All of the above options

4. Which of the following is representing a single expense account? Ans. - B

A. Depreciation

B. Cash account

C. Wages & Salaries

D. Utilities account

5. Which one of the following is a barriers to new product creation and development? Ans. - B
A. Trial and error

B. Opportunity parameter

C. Opportunity cost

D. Intrapreneurship culture

6. Which one of the following should consider in economy while conducting environmental analysis?

A. GNP Ans. – A

B. Disposable income

C. Unemployment

D. Channel of distribution

7. Following are the problems in developing the economies EXCEPT: Ans. – C

A. Gap of knowledge

B. Variable rate of return

C. Same communication style

D. Different accounting system

8. Entrepreneurs are concerned about basic issues of: Ans. - A

A. Sales, costs and benefits

B. Customers, sales and costs

C. Risk, costs and benefits

D. None of the above

9. A set of reasons for engaging in a particular behavior, especially human behavior is

known as _____________. Ans. - D

A. Values

B. Vision

C. Entrepreneurship

D. Motivation
10. Entrepreneurial success has been significant because of the culture and the political and economic systems
in _________. Ans. - C

A. European countries

B. Asian countries

C. Transition economies

D. Middle east

11. The rate at which the future cash flows are reduced to their present value is termed as Ans. - D

A. Interest Rate.

B. Fixed Rate.

C. Future Rate.

D. Discount Rate.

12. ______________ may be defined as the excess of present value of project cash inflows over that of out
flows Ans. - A

A. Net present value technique.

B. Average rate of return.

C. . Benefit-Cost ratio.

D. . Internal rate of return

13. Estimated sale value of the asset at the end of its economic life is known as _____. Ans. - D
A. purchase value.
B. market value.
C. written down value.
D. residual value.

14. The value of asset can be reduced to zero under this method _____. Ans. - A
A. straight line method.
B. written down value method.
C. annuity method.
D. depreciation fund method.

15. Depreciation applies to_______. Ans. - D

A. current assets .
B. wasting assets.
C. intangible assets.
D. fixed assets.
16. Depletion applies to _____. Ans. - B
A. current assets .
B. wasting assets.
C. intangible assets.
D. fixed assets.

17. Amortization applies to _____. Ans. - C

A. current assets .
B. wasting assets.
C. intangible assets.
D. fixed assets.

18. Depreciation is charged on _____. Ans. - A

A. continuous basis.
B. temporary basis.
C. daily basis.
D. monthly basis.

19. Depreciation is charged on the _______. Ans. - B

A. market value.
B. book value.
C. purchase value.
D. sale value.

20. Depreciation is provided on _____. Ans. - B

A. current asset.
B. fixed assets.
C. fictitious assets.
D. investment.

21. The permanent, continuing and gradual shrinkage in the book value of a fixed asset is called Ans. - A

A. depreciation.
B. appreciation.
C. reduction.
D. computation.

22. The main objective of providing depreciation is ______. Ans. - A

A. to calculate true profit.
B. to calculate financial position.
C. to reduce tax burden .
D. to reduce profit.

23. Under the straight line method of charging depreciation, depreciation _____. Ans. - C
A. increases every year.
B. decreases every year.
C. is constant.
D. fluctuate every year.

24. Under the diminishing balance method depreciation is calculated on _______. Ans. - B
A. original value
B. written down value.
C. scrap value.
D. market value.
25. Overhead cost is the total of ________. Ans. - A
A. all indirect costs.
B. all direct costs.
C. indirect and direct costs.
D. all specific costs.

26. Cost classification can be done in ________. Ans. - D

A. two ways.
B. three ways.
C. four ways.
D. several ways.

27. Wages paid to a labour who was engaged in production activities can be termed as _______. Ans. - A
A. direct cost.
B. indirect cost.
C. sunk cost.
D. imputed cost.

28. Direct expenses are also called ________. Ans. - B

A. major expenses.
B. chargeable expenses.
C. overhead expenses.
D. sundry expenses.

29. Cost of sales plus profit is _______. Ans. - A

A. selling price.
B. value of finished product.
C. value of goods produced.
D. value of stocks.

30. Prime cost includes _______. Ans. - C

A. direct materials, direct wages and indirect expenses.
B. indirect materials and indirect labour and indirect expenses.
C. direct materials, direct wages and direct expenses.
D. direct materials, indirect wages and indirect expenses.

31. Total of all direct costs is termed as _________. Ans. - A

A. prime cost.s
B. works cost.
C. cost of sales.
D. cost of production.

32. Depreciation of plant and machinery is a part of _________. Ans. - A

A. factory overhead.
B. selling overhead.
C. distribution overhead.
D. administration overhead.

33. One of the most important tools in cost planning is _______. Ans. - C
A. direct cost.
B. budget.
C. cost sheet.
D. marginal costing.

34. Fixed cost per unit increases when ____. Ans. - D

A. variable cost per unit increases.
B. variable cost per unit decreases.
C. production volume increases.
D. production volume decreases.

35. Variable cost per unit __________. Ans. - B

A. varies when output varies.
B. remains constant.
C. increase when output increases
D. decreases when output decreases

36. Increase in total variable cost is due to ___________. Ans. - C

A. increase in fixed cost.
B. increase in sales.
C. increase in production.
D. increase in efficiency.

37. Expenditure over and above prime cost is known as __________. Ans. - A
A. overhead.
B. factory cost.
C. cost of sales.
D. cost of production.

38. Actual loss is more than the predetermined normal loss, it is _________. Ans. - B
A. normal loss.
B. abnormal loss.
C. seasonal loss.
D. standard loss.

39. The process of selecting from alternative long-term investment projects is called: Ans. - B
A. Net cash inflow maximization.
B. Capital budgeting.
C. Discounting cash inflows.
D. Cash flow management.

40. The time value of money refers to: Ans. - A

A. The earning power of an investment or stream of investments over time.
B. The opportunity cost of capital.
C. The interest rate earned on an investment.
D. The discount rate used to calculate the present value of an investment.

41. Future value may be defined as: Ans. - C

A. The discounted value of future cash flows.
B. The interest rate earned on future cash flows.
C. The compounded value of future cash flows.
D. The opportunity costs of future cash flows.

42. Present value may be defined as: Ans. - A

A. The discounted value of future cash flows.
B. The interest rate earned on future cash flows.
C. The compounded value of future cash flows.
D. The opportunity costs of future cash flows.

43. The payback period is: Ans. - C

A. The number cash-flow periods of an capital investment project.
B. The number of years that it takes to earn a profit of a capital investment project.
C. The number of periods required to pay for the original investment.
D. The number of periods required to calculate the net present value of an investment project.

44. An advantage of the payback period method of evaluating a capital investment project is that it: Ans. - C
A. Does not consider the time value of money.
B. Ignores cash flows beyond the payback period.
C. Provides a rough approximation of a projects liquidity and risk.
D. Provides a rough approximation of the present value of net cash flows.

45. Two projects are independent if: Ans. - B

A. Acceptance of one project means rejection of the other.
B. Their cash flows are unrelated.
C. They have different hurdle rates.
D. They have different discounted payback periods.

46. ___is primarily concerned with the identification qualification and evaluation of the project resources
A. Techno-economic analysis. Ans. - B
B. Feasibility analysis.
C. Input analysis.
D. Financial analysis.

47. Large investment is made in fixed assets, the project will be termed as __________ Ans. - A
A. Capital Intensive.
B. Labour Intensive.
C. Product Intensive.
D. Market Intensive.
48. .____________ is primarily concerned with the identification of the project demand potential and the
selection of the optimal technology Ans. - A
A. Techno-economic analysis.
B. Feasibility analysis.
C. Input analysis.
D. Financial analysis.

49 ._____________ involves estimates about project costs and revenues and the funds required for the project
A. Techno-economic analysis. Ans. - D
B. Feasibility analysis
C. Input analysis.
D. Financial analysis

50. PIR stands for_____________ Ans. - A

A. Pre- investment report.
B. Post-investment report.
C. Pre- infrastructure report.
D. Post-infrastructure report

UNIT – III

1.Factors contribute to the creation of new venture EXCEPT: Ans. - C

A. Government

B. Finance

C. High interest rates

D. Role models

2. Which of the following is the most important for the entrepreneur, while starting a new venture, to make an
assessment of? Ans. - A

A. Risk

B. Profit

C. Market

D. Competitors

3. Which of the following is alternatively called corporate venturing? Ans. - B

A. Entrepreneurship

B. Intrapreneurship

C. Act of stating a new venture

D. Offering new products by an existing company

4. Which of the following factor is most important in forming a new business? Ans. - D

A. Finance

B. Marketing

C. Government support

D. Family support

5. Most of the finance for the new firm comes from following resources EXCEPT: Ans. - B

A. Friends

B. Foreign aid

C. Relatives

D. Personal savings

6. Which one of the following is an important source of idea generation due to their familiarity with the needs
of market? Ans. - A

A. Existing products and services

B. Distribution channels

C. Federal government

D. Consumers

7. Members of distribution channels are excellent sources for new ideas because: Ans. - A

A. They are familiar with the needs of the market

B. They earn a handsome profit from new business

C. They do not bother if entrepreneur bears a loss

D. They have well-developed sales force

8. Why should an entrepreneur do a feasibility study for starting a new venture? Ans. - A

A. To see if there are possible barriers to success

B. To identify possible sources of funds

C. To estimate the expected sales

D. To explore potential customers

9. Which of the following is idea generation method that focuses on parameters? Ans. - C

A. Brainstorming

B. Reverse brainstorming

C. Creative problem solving

D. Synoptic

10. Which of the following factor is most important in forming a new business? Ans. – A

A. Finance

B. Marketing

C. Government support

D. Family support

11. Which is the most common cause of business failure? Ans. - D

A. Insufficient capital

B. Unstable market

C. Insufficient experience

D. Poor entrepreneurship

12. Entrepreneurial experience becomes increasingly important as Ans. - B

A. Work load increases

B. Complexity of venture increases

C. Complexity of wok increases

D. None of the above

13. Joint ventures have been used by entrepreneur: Ans. - C

A. When the entrepreneur wants to purchase local knowledge

B. When rapid entry in to the market is needed

C. Both of the options given

D. None of the above

14. Which of the following statements about the intrepreneurial climate is (are) true? Ans. – B

A. Trial and error are discouraged.

B. Resources of the firm need to be available and easily accessible

C. A multidisciplinary approach is discouraged.

D. Failures are not allowed

15. The entrepreneur must possess the abilities: Ans. - D

A. Creative

B. Conceptualization

C. Understanding environment

D. All of the given options

16. There is evidence that an entrepreneur usually has _______________ parents. Ans. - A

A. Self employed

B. Discouraged

C. Non supportive

D. Strict

17. Which one of the following is the primary cause of failure in small businesses? Ans. - C

A. Poor financial control

B. Poor location

C. Management mistakes

D. Improper inventory control

18. Which of the following techniques is an excellent method for initial screening of ideas and concepts?

A. Focus group Ans. - C

B. Problem inventory analysis

C. Brain storming

D. Reverse brainstorming

19. Which one of the following may need the business plan? Ans. - B
A. Employees

B. Investors

C. Advisors

D. All of the given options

20. Which of the following is the reason for business failure __________ Ans. - D
A. Lack of market research.
B. Poor financial control.
C. Poor management.
D. All the above.

21. The management of resources in a small firm is largely __________ concerned with Ans. - D
A. Operations.
B. Finance.
C. . Marketing.
D. All the above.

22. A cash flow forecast will form part of which section of the business plan ______ Ans. - C
A. Operations.
B. Marketing.
C. Finance.
D. Executive summary.

23. The Markets and Competitor section of a business plan should contain ____________ Ans. - D
A. A statement of the target market.
B. The size of each market segment.
C. The key characteristics of buyers in each business segment.
D. All the above.

24. A key aspect of the financial section of the business plan is _________ Ans. - B
A. A statement of management skills.
B. A realistic sales forecast
C. Production capacity.
D. A description of competitors

25. As a new company grows, the entrepreneur will need to _________ Ans. - D
A. be responsive to changes in the market
B. ensure financial controls are maintained.
C. build a management team.
D. all the above.

26. A business plan should be produced ___________ Ans. - D

A. at a new business start-up.
B. as part of an on-going review.
C. when the entrepreneur is faced with a major decision
D. all the above.
27. One of the common mistakes when starting a new business venture is being overoptimistic about market
size. This could be a result of __________ Ans. - B
A. proper planning
B. poor market research
C. diversifying too soon.
D. focusing on sales volume rather than profit.

28. Entrepreneurs are motivated by _________ Ans. - D

A. money.
B. personal values
C. pull influences.
D. All the above.

29. Which one of the following is not considered as one of the building blocks of the model entrepreneur
A. technical skills. Ans. - C
B. management competencies.
C. business awareness.
D. personal attributes.

30. The purpose of all good small business strategy is__________ Ans. - D
A. to increase turnover.
B. to increase profitability.
C. to achieve competitive advantage
D. . to achieve stated objectives.

31. The first step in starting a new business venture is _________ Ans. - A
A. . Idea generation.
B. Scanning of ideas.
C. Preparing a business plan.
D. Project implementation

32. _______________ is granted to small scale units under section 33B of the Income tax act 1961.
A. Depreciation Allowance Ans. - D
B. Development Debate.
C. Investment Allowance.
D. Rehabilitation Allowance.

33. . _______________ is granted to small scale industry under section 32 Ans. - C

A. Depreciation Allowance.
B. Development Rebate.
C. Investment Allowance.
D. Rehabilitation Allowance.

34. New Small Scale industries are exempted from the payment of income tax under section 80J is called
A. Development Rebate. Ans. - B
B. Investment Allowance.
C. . Rehabilitation Allowance.
D. Tax Holiday .

35. ______________ was introduced in 1976 and allowed rate of 25 % of the cost of acquisition of new plant or
machinery installed Ans. - B
A. Development Allowance.
B. Investment Allowance.
C. Rehabilitation Allowance.
D. Tax holiday.

36. Under section 80J of the income tax act 1961 small-scale industries are exempted from the payment of
income tax on their profits at ___________ Ans. - A
A. 6% p.a.
B. 6% p.m.
C. 5% p.a.
D. 5% p.a.

37. The policy which stressed the role of cottage and small-scale industries for balanced industrial development
of the country is ___________ Ans. - B
A. IPR 1940.
B. IPR 1948.
C. IPR 1956.
D. IPR 1977.

38. The policy which emphasized the need of promoting small-scale industries through integrated industrial
development is_____________ Ans. - C
A. IPR 1948
B. IPR 1956.
C. IPR 1977.
D. IPR 1980.

39. . The small scale unit wishing to export has to obtain exporters code number from _________Ans. - A
A. The Reserve Bank of India.
B. The Central Bank of India.
C. Any Regional Bank.
D. Any International Bank.

40. The expenses incurred on the setting up of the enterprise are called as _________ Ans. - B
A. Cost of financing.
B. Cost of promotion..
C. Cost of fixed assets.
D. Cost of current assets.

41. Over capitalization arises due to___________ Ans. - C

A. excess of assets over the liabilities.
B. excess of liabilities over the assets.
C. actual earnings are lower than the expected earnings
D. actual earnings are higher than the expected earnings.

42. Under-capitalization arises due to __________ Ans. - D

A. excess of assets over the liabilities.
B. excess of liabilities over the assets.
C. actual capitalization is higher than the proper capitalization.
D. actual capitalization is lower than the proper capitalization.

43. Which of the following leads to over-capitalization? Ans. - A

A. acquiring fixed assets on excessive amounts.
B. under-estimation of initial rate of earnings.
C. using lower-rate of capitalization.
D. under estimation of required funds.

44.. Which of the following leads to under-capitalization? Ans. - C

A. raising of more money by issue of shares.
B. acquiring fixed assets on excessive amounts.
C. over-estimation of earnings for enterprise.
D. under-estimation of initial rate of earnings.

45. Business means ________. Ans. - B

A. Commerce.
B. industry and commerce.
C. trade and commerce.
D. selling and buying of goods.

46. A valid definition of a business purpose is to ______. Ans. - B

A. create a customer.
B. maximize profits
C. serve the society.
D. increase the wealth of the firm.

47. Reserve bank of India is a/an _______. Ans. - A

A. a statutory corporation.
B. company limited by guarantee.
C. company limited by shares.
D. unlimited company.

48. Memory unit performs the function of ________. Ans. - D

A. calculations at a very high speed.
B. giving out the end product.
C. controlling at the operating units.
D. storing the data.

49. Business risks can be ______. Ans. - B

A. avoided.
B. reduced.
C. ignored.
D. erased.

50. The oldest form of business organization is ______. Ans. - B

A. Partnership.
B. sole proprietorship.
C. joint stock company.
D. co-operative undertaking.

UNIT - IV

1. An entrepreneur doing business within the national border is called: Ans. - C

A. International entrepreneurship

B. Intrapreneurship

C. Domestic entrepreneurship

D. None of the given options

2. The chief motivational factor for _________________ entrepreneurs to leave jobs is the frustration of not

being allowed to perform at the level of which they are capable. Ans. - D

A. Male
B. Female
C. Young
D. All of the given options

3. An entrepreneur doing business within the national border is called: Ans. - C

A. International entrepreneurship

B. Intrapreneurship

C. Domestic entrepreneurship

D. Imports

4. The entrepreneur’s_______________ depends on his perception of the opportunity. Ans. - D

A. Commitment to opportunity

B. Commitment of resources

C. Control of resources

D. Strategic orientation

5. Which one of the following is important for international business to avoid trade barriers? Ans. - C

A. Protectionist attitude

B. Entrepreneurial partnering

C. Free trade areas

D. None of the given options

6. Selling goods to another country through a person in the entrepreneur’s home country is known as:
A. Trading Ans. - C

B. Direct export

C. Indirect export

D. Domestic sales

7. Assessment of the needed resources by the entrepreneur starts with: Ans. – C

A. An appraisal of the entrepreneur’s present resources

B. An assessment of economic conditions of the country

C. A scanning of friends and family for funds

D. A survey of banks and other financial institutions in the area

8. The level at which an individual is viewed by society is called: Ans. – C

A. Financial status

B. Qualification

C. Social status

D. Achievement

9. Which of the following method entrepreneur can use to do international business with least risk?

A. Turnkey projects Ans. - A

B. Joint venture

C. Merger

D. Synergy

10. Which one of the following is the main problem for the entrepreneur in the beginning stages of creating a
new venture? Ans. - A

A. Lack of experience

B. Limited resources

C. Lack of education

D. None of the given options

11. Having more than 50% ownership position that provides the entrepreneur with managerial control is called:
A. Joint venture Ans. - B

B. Majority interest

C. Horizontal merger

D. Diversified activity merger

12. Individuals influencing an entrepreneur’s career choice and style are known as which of the following?

A. Role model Ans. - A

B. Moral-support network

C. Professional support network

D. Support system

13. Which of the following is a method of selling goods to another country by taking care of transactions?

A. Indirect exporting Ans. - B

B. Direct exporting

C. Importing

D. Management contract

14. An entrepreneur is also successful in international business as well if he understands: Ans. - A

A. Difference of domestic and international business

B. Domestic business

C. International business

D. None of the given options

15. Which of the following is NOT an important aspect of international success? Ans. - C

A. Planning

B. Diversification

C. Reporting

D. Control
16. In some countries, point of purchase displays are not allowed in retail stores. Such differences are studied by
international entrepreneurs under __________. Ans. - D

A. Economic Environment

B. Political Environment

C. Cultural Environment

D. Technological Environment

17. An entrepreneur is also successful in international business as well if he understands: Ans. - A

A. Difference of domestic and international business

B. Domestic business

C. International business

D. None of the given options

18. Which of the following is NOT an important aspect of international success? Ans. - C

A. Planning

B. Diversification

C. Reporting

D. Control

19. Which of the following geographical area is of least interest to U.S entrepreneurs? Ans. - D

A. Europe

B. The Far East

C. Central Asia

D. Transition economies

20. Which of the following areas are preferred by women entrepreneurs? Ans. - A

A. Administration

B. Utilities

C. Manufacturing

D. None of the above

21. Which of the following factors does not affect a person for being an entrepreneur? Ans. - C

A. Family background

B. Education

C. Personal values

D. Gender

22. The UK government has implemented a number of policies to encourage entrepreneurship in schools.
One such initiative is _________ Ans. - A
A. Young Enterprise
B. Youth venture
C. Young Business
D. Young Initiative.

23. A business centre that offers working space and specialised support for new ventures is
called______________ Ans. - C
A. isolator.
B. injector.
C. incubator.
D. integrator.

24. An entrepreneur who owns more than one business at a time is called ________ Ans. - C
A. an intrapreneur.
B. a corporate entrepreneur.
C. a portfolio entrepreneur.
D. None of the above

25. To provide financial assistance to entrepreneurs the government has set up a number of___________
A. financial advisors. Ans. - D
B. financial intermediaries
C. Industrial estates.
D. financial institutions.

26. SFC stands for____________ Ans. - C

A. State financial committee.
B. State funding corporation
C. State finance corporation.
D. State funding committee.

27. State Industrial corporations engage in the development of__________ Ans. - A

A. industrial estates.
B. institutional estates.
C. individual investors.
D. agricultural entrepreneurs

28. SIDBI stands for __________ Ans. - A

A. Small institutions development bank of India.
B. Small industries development bank of India
C. Small industries derivatives bank of India.
D. Small industries development bureau of India.

29. SIDBI was set up in the year__________ Ans. - C

A. 1987.
B. 1988.
C. 1989.
D. 1990.

30. SIDBI was set up as a subsidiary of_________ Ans. - A

A. IDBI.
B. IFCI.
C. ICICI.
D. . SFC.

31. The initial authorized capital of SIDBI is________ Ans. - C

A. Rs. 350 crores.

B. Rs. 450 crores.
C. Rs. 250 crores.
D. Rs. 150 crores.

32. Which of the following is a function of SIDBI Ans. - D

A. Extension of seed capital.
B. Discounting of bills.
C. Providing factoring services.
D. All of the above.

33. SIDC stands for __________ Ans. - A

A. State industrial development corporation.
B. Small industries development corporation
C. State institutional development corporation.
D. Small institutional development corporation.

34. SIDC was set up under the__________ Ans. - B

A. Co-operative societies Act.
B. Companies Act.
C. Industries Act.
D. Partnership Act.

35. The financial resources of SIDC consist of __________ Ans. - D

A. paid-up capital.
B. loans from State govt.
C. refinance from RBI.
D. All of the above.

36. SIDO stands for____________ Ans. - C

A. State Travel Industries Development Organization.
B. Service Industries Development Organization.
C. Small Industries Development Organization.
D. Small Institution Development Organization.

37. The main function of SIDO is _________ Ans. - D

A. a. To provide SSI with machines on hire purchase basis.
B. a. To assist small industries with marketing facilities.
C. a. To distribute basic raw materials through their depots.
D. a. To secure reservation of certain products for the SSIS.

38. SISI was established in _____________ Ans. - A

A. 1956.
B. 1965.
C. 1970.
D. 1972.

39. IIC stands for____________ Ans. - B

A. Indian Industries Centre.
B. Indian Investment Centre.
C. Indian Investment Corporation.
D. indian Industries Corporation.

40. Entrepreneurial Guidance Bureau(EGB) was set up by____________ Ans. - C

A. SISI.
B. SIPCOT.
C. IIC.
D. SIDCO.

41. National Alliance of Young Entrepreneurs (NAYE) Sponsored an Entrepreneurial Development scheme
with Bank of India in______________ Ans. - D
A. January 1920.
B. August 1920.
C. January 1972.
D. August 1972.

42. Khadi & Village Industries Commission was established in ___________ Ans. - A
A. 1953.
B. 1950.
C. 1947.
D. 1942.

43. NEDS stands for __________ Ans. - B

A. New Enterprise Development Agency.
B. New Entrepreneur Development Agency.
C. New Employees Development Agency.
D. New Employers Development Agency.

44. __________ denotes a single lump sum which is given by a government to an industry Ans. - B
A. Incentive.
B. Subsidy.
C. Bounty.
D. Financial Aid
45. The term ___________ denotes bonus or financial aid which is given by a government to an industry to help
it compete with other units Ans. - C
A. Incentive.
B. Subsidy.
C. Bounty.
D. Concession.

46. The granting of cash subsidy on the capital investment is called __________ Ans. - D
A. Concessional finance
B. Quantum of Subsidy.
C. Interest Subsidy.
D. Central Investment Subsidy.

47. Which of the following factors does the macro-environment not include Ans. - B
A. political and regulatory factors
B. customer needs in a given market
C. social and demographic factors
D. technological changes

48. An entrepreneur who owns more than one business at a time is called ________ Ans. - C
A. an intrapreneur.
B. a corporate entrepreneur.
C. a portfolio entrepreneur.
D. None of the above

49. An entrepreneur who runs a business sells it and moves onto another venture in a relatively short time is
called _______________ Ans. - B
A. a failed entrepreneur.
B. a serial entrepreneur.
C. a multiple entrepreneur
D. secondary entrepreneur

50. To provide financial assistance to entrepreneurs the government has set up a number of:- Ans. - D
A. financial advisors.
B. financial intermediaries
C. Industrial estates.
D. financial institutions