IMS Engineering College, Ghaziabad

Entrepreneurship Development (ROE-082)

MODEL QUESTION PAPER

Multiple Choice Questions

1. An individual who starts, creates and manages a new business can be called
.
A. A leader
B. A manager
C. A professional
D. An entrepreneur
ANSWER: D

2. Trademarks relate to .
A. Practice and knowledge acquired through experience
B. The protection of proprietary information of commercial value
C. The right to reproduce ones own original work
D. Brand identity
ANSWER: D

3. Which could provide an individual with the motivation to start a new business venture?
A. The financial rewards.
B. A desire to be independent.
C. Risk taking
D. All the above.
ANSWER: D

4. Which industrial sector promotes small-scale businesses and

Entrepreneurship, and has lower barriers to market entry?
A. Service.
B. Manufacturing.
C. Distribution.
D. Agriculture
ANSWER: A

5. Why are small businesses important to a country's economy?

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.
ANSWER: D

6. A business arrangement where one party allows another party to use a business name and sell
its products or services is known as .
A. A cooperative.
B. A franchise.
C. An owner-manager business.
D. A limited company.
ANSWER: B

7. Which of the following is the reason for business failure ?

A. Lack of market research.
B. Poor financial control.
 C. Poor management.
D. All the above.
ANSWER: D

8. A new venture's business plan is important because .

A. It helps to persuade others to commit funding to the venture.
B. Can help demonstrate the viability of the venture.
C. Provides a guide for business activities by defining objectives.
D. All the above.
ANSWER: D

9. Primary data is .
A. the most important data.
B. the data that is collected first.
C. new data specifically collected for a project.
D. data that is collected second.
ANSWER: C

10. Innovation can best be defined as .

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

11. Which of these statements best describes the context for entrepreneurship?
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.
ANSWER: C

12. Entrepreneurs are motivated by .

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

13. Which of the following is least likely to influence the timing of new business births?
A. Government policies.
B. Profitability.
C. Consumer expenditure.
D. Weather conditions.
ANSWER: D

14. Which of the following statements is false?

A. Market segmentation is a useful process for small businesses to undertake.
B. Selling is essentially a matching process.
C. A benefit is the value of a product feature to a customer.
D. It is a good idea for small businesses to compete solely on price.
ANSWER: D

15. Someone legally appointed to resolve the financial difficulties of an insolvent firm
is called .
A. an administrator.
B. a predator.
C. an auditor.
D. a turnaround consultant.
ANSWER: A

16. Goods or services reach the market place through .

A. marketing channels.
B. multilevel pyramids.
C. monopolies.
D. multiplication.
ANSWER: A

17. To provide financial assistance to entrepreneurs the government has set up a

number of .
A. financial advisors.
B. financial intermediaries.
C. Industrial estates.
D. financial institutions.
ANSWER: D

18. State Industrial corporations engage in the development of .

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

19. IFCI stands for .

A. Industrial finance corporation of India.
B. Institutional finance corporation of India.
C. Industrial funding corporation of India.
D. Indian finance corporation and institution.
ANSWER: A

20. IFCI has been converted into a .

A. joint stock company.
B. co-operative society.
C. partnership firm.
D. sole proprietorship.
ANSWER: A

21. SIDBI was set up as a subsidiary of .

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

22. Which of the following is a function of SIDBI?

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

23. TIIC is sponsored by the .

A. Government of Karnataka.
B. Government of Andhra Pradesh.
C. Government of Kerala.
D. Government of Tamil Nadu.
ANSWER: D

24. In backward areas, term loans for expansion or setting up a new unit are available at
.
A. concessional terms.
B. differential terms.
C. standard terms.
D. specific terms.
ANSWER: A

25. EDPs course contents contains .

A. General introduction to entrepreneurs.
B. Motivation training.
C. Managerial skills.
D. All the above.
ANSWER: D

26. Entrepreneurial Guidance Bureau(EGB) was set up by .

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

27. Large investment is made in fixed assets, the project will be termed as .
A. Capital Intensive.
B. Labour Intensive.
C. Product Intensive.
D. Market Intensive.
ANSWER: A

28. PERT stands for .

A. Programme Evaluation and Research Techniques.
B. Project Evaluation and Review Techniques.
C. Programme Evaluation and Review Techniques.
D. Project Evaluation and Research Techniques.
 ANSWER: C

29. is used to accomplish the project economically in the minimum available

time with limited resources
A. Project Scheduling.
B. Network Analysis.
C. Budget Analysis.
D. Critical Planning.
ANSWER: A

30. is a form of financing especially for funding high technology, high

risk and perceived high reward projects
A. Fixed capital.
B. Current capital.
C. Seed capital.
D. Venture capital.
ANSWER: D

31. The term denotes bonus or financial aid which is given by a government to an
industry to help it compete with other units
A. Incentive.
B. Subsidy.
C. Bounty.
D. Concession.
ANSWER: C

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

33. is primarily concerned with the identification of the project demand

potential and the selection of the optimal technology.
A. Techno-economic analysis.
B. Feasibility analysis.
C. Input analysis.
D. Financial analysis.
ANSWER: A

34. Activities which must be finished before a given event can occur are termed as .
A. Preceeding Activities.
B. Succeeding Activities
C. Concurrent Activities
D. Dummy Activities.
ANSWER: A
35. EST stands for .
A. Earliest Start Time.
B. Event Start Time.
C. Effective Start Time.
D. Essential Start Time.
ANSWER: A

36. Additional time which a non-critical activity can consume without increasing the project
duration is called .
A. Total Float.
B. Free Float
C. Independent Float.
D. Dependant Float
ANSWER: A

37. is an activity-oriented approach.

A. CPM
B. PERT
C. GERT
D. WASP
ANSWER: A

38. is the analysis of costs and benefits of a proposed project with the goal
of assuming a rational allocation of limited funds.
A. Project formulation.
B. Project evaluation.
C. Project appraisal .
D. Project Design.
ANSWER: C

39. may be defined as the excess of present value of project cash inflows over
that of out flows.
A. Net present value technique.
B. Average rate of return.
C. Benefit-Cost ratio.
D. Internal rate of return
ANSWER: A

40. Decisions which are concerned with policy matters and exercise fundamental influence on
the objectives of the organization are called as .
A. Organizational decisions.
B. Personal decisions.
C. Routine decisions.
D. Strategic decisions.
ANSWER: D

41. is a problem -solving technique designed to produce numerous ideas

in a short period
A. Synectics.
B. Delphi technique.
C. Brain storming.
D. Nominal group technique.
ANSWER: C
42. . is the systematic development of a project idea for the
eventual purpose of arriving at an investment decision.
A. Project identification.
B. Project formulation.
C. Project feasibility.
D. Project evaluation.
ANSWER: B

43. CPM stands for .

A. Continuous Path Method.
B. Clear Path Method.
C. Critical Path Method.
D. Critical Probabilistic Method.
ANSWER: C

44. National Alliance of Young Entrepreneurs (NAYE) Sponsored an

Entrepreneurial Development scheme with Bank of India in .
A. January 1920.
B. August 1920.
C. January 1972.
D. August 1972.
ANSWER: D

45. A business arrangement where one party allows another party to use a business Name and
sell its products or services is known as .
A. A cooperative.
B. A franchise.
C. An owner-manager business.
D. A limited company.
ANSWER: B

46. A key aspect of the financial section of the business plan is .

A. A statement of management skills.
B. A realistic sales forecast.
C. Production capacity.
D. A description of competitors.
ANSWER: B

47. Which one of the following is not considered as one of the building blocks of the model
entrepreneur?
A. technical skills.
B. management competencies.
C. business awareness.
D. personal attributes.
ANSWER: C
48. An entrepreneur who owns more than one business at a time is called .
A. an intrapreneur.
B. a corporate entrepreneur.
C. a portfolio entrepreneur.
D. None of the above.
ANSWER: C

49. LOB stands for .

A. Line of Business.
B. Line of Balance.
C. Loss of Business.
D. Loss of Balance
ANSWER: B

50. Underestimation of project cost leads to .

A. Time under run.
B. Cost under run
C. Time over run.
D. Cost over run
ANSWER: D

51. New entrepreneurs entering the field of medium industry for the first time can have market
studies with the subsidiary of .
A. 75% of the cost or Rs.15000 whichever is less.
B. 75% of the cost or Rs.15000 whichever is high
C. 50% of the cost or Rs.15000 whichever is less.
D. 50% of the cost or Rs.15000 whichever is high
ANSWER: A

52. Seed capital assistance _ .

A. a long-term assistance.
B. initial assistance
C. a help for the purchase of seeds.
D. a short-term assistance.
ANSWER: B

53. EXIM bank is a .

A. State-level institution.
B. Regional -level institution.
C. All India institution.
D. International institution.
ANSWER: C

54. The policy which emphasized the need of promoting small-scale industries through
integrated industrial development is .
A. IPR 1948.
B. IPR 1956.
C. IPR 1977.
D. IPR 1980.
ANSWER: C
55. Over - capitalization arises due to .
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.
ANSWER: C

56. Under-capitalization arises due to .

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.
ANSWER: D

57. Which of the following leads to under-capitalization?

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.
ANSWER: D

58. A public corporation means .

A. public company.
B. government company.
C. statutory corporation.
D. department of union government
ANSWER: C

59. The term Capitalization is used in relation to .

A. sole-proprietorship.
B. Partnership.
C. joint stock companies.
D. co-operative societies
ANSWER: C

60. Which of the following sources is not use for medium term financing?
A. Issue of equity shares.
B. Issue of debentures.
C. Term loans from banks.
D. Sale of current asset.
ANSWER: A

61. Which of the following securities proves a burden on finances of the company,
when company is not earning profits?
A. Equity shares.
B. Preference shares.
C. Redeemable preference shares.
D. Debentures.
ANSWER: D
62. Investment in which of the following is most risky?
A. Equity shares.
B. Preference shares.
C. Debentures.
D. Land.
ANSWER: C

63. Entrepreneurship can best be described as .

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.
ANSWER: D

64. Entrepreneurial development is the key to achieve all-round through

A. economic development
B. increase in profits
C. shareholders value
D. business development
ANSWER: A

65. NABARD is a Bank for development

A. Urban
B. Agricultural and Rural
C. Scientific
D. Agriculture and research
ANSWER: B