Growth and Challenges of Entrepreneurial Venture – Business Management Ethics and Entrepreneurship Notes

Supply of entrepreneurship and economic development:

  • British economists like Adam Smith, David Ricardo and John Stuart Miii explained entrepreneurship under the head of business management.
  • According to John Mili, entrepreneurship does not require any ordinary skill”.
  • The necessity of entrepreneurship was first formally recognized by Alfred Marshall in 1890.
  • According to Marshall, there are four factors of production – land, labour, capital and organisation. Here organisation is driven by entrepreneurs.
  • Marshall stated that the abilities of entrepreneurs are so great and so numerous that very few people can exhibit them in all and in a very high degree.
  • Modern school of thought claims that the rote of entrepreneur is that of an innovator.
  • According to Kirzner, process of innovation is actually a spontaneous process of “undeliberate learning’.
  • He also stated that necessary characteristics of the entrepreneur is alertness and no intrinsic skill other than that of recognizing opportunities are necessary.

Concept of creative imitation:

  • Entrepreneurs of mostly less developed countries do not invent a new product rather they copy it from already existing ones.
  • These entrepreneurs formulate the product according to their market using their own creativity.
  • This is known as “creative imitation’.
  • It is common in developing or least developed countries.
  • It takes place when imitators better understand how an innovation can be applied, used, or sold in their original innovation.

Qualities of an Entrepreneur:

  1. Risk Bearers
  2. Co-ordinators
  3. Organizers
  4. Gap fillers
  5. Leaders
  6. Innovators
  7. Creative imitators.

Creation of Entrepreneurs:

  • As per the recent Mckinsey & Company- Nasscom report, India needs at least 8,000 new businesses to achieve its target.
  • It is also estimated that in the next 10 years, 110-130 mull n Indian citizens will be searching for jobs.
  • For creating more jobs, we need to create entrepreneurs.

While creating more entrepreneurs the country should focus on:

  • Creating right environment for source.
  • Ensuring that entrepreneurs have access to the right skill.
  • Ensuring that entrepreneurs have access to smart capital.
  • Enabling networking and exchanging between entrepreneurs.

A distinction is to be made between an employee and entrepreneur.
(a) Employee – Time is money.
Entrepreneur – Leverage is money.
(b) Employee – They work hard and their effort and reward are linear.
Entrepreneurs – They work smart and their efforts and rewards are exponential.
(c) An attitude of ‘first getting b may suit an employee but not an entrepreneur.
(d) Employees think short term whereas entrepreneurs think long term.

Challenges before an Entrepreneur:

Challenges before an Entrepreneurs Qualities needed to overcome Challenges
1.  No protection to employers 1. Innovative
2.  Global competition 2.  Risk oriented
3. Adjusting with the changing environment 3. Achievement-oriented
4. Maintaining a proper balance between project and personnel. 4. Managerial skills and leadership
5. Delayed payments 5. Mental ability
6. Uncertainty in returns 6. Ability to practice entrepreneurship
7. Other factors like ship 7. An economic activity.
  • Financial struggle during startup.
  • Non-supporting family/friends
  • Lack of qualities of entrepreneur.

→ Innovation is an essential quality of an entrepreneur.
→ Paul H Wilkeh lists out the following innovations brought out by entrepreneurs:

Change Innovation
1. Factor innovation Increase in supply or productivity of factors 1. Procuring new source of finance
2. Procuring labour from new source
3. Using new material
2. Product Innovation Changes in production process 1. Use of new production techniques
2. Change the form and structure of organisation.
3. Market Innovation Change in size or composition of the market 1. Production of new good
2. Exploring new markets.
  • The term achievement orientation means quest to success in relation to preset standards of excellence.
  • It is the prime factor that explains economic behaviour of entrepreneurs.
  • According to Peter Drucker, entrepreneurship is neither a science nor an art. It is a practice”.

Areas to be focused for developing Entrepreneurship In India
1. Creating the Right Environment for success
2. Ensure that Entrepreneurs have access to the right skills
3. Ensuring that Entrepreneurs have access to Smart Capital
4. Enabling network and Exchange

Strategic Planning for Emerging Venture:
Strategic planning is the formulation of long-range plans for the effective management of environmental opportunities and threats in the light of venture’s strengths and weaknesses.

These are five basic steps involved in Strategic Planning:

  • Examine the internal and external environments of the venture (strengths, weaknesses, opportunities and threats).
  • Formulate the venture long-range ad short-range strategies (mission, objectives, strategies and policies).
  • implement the strategic plan (programs, budgets and procedures).
  • Evaluate the performance of the strategy.
  • Take follow-up action through continuous feedback.

Financing of the Entrepreneurial Business
For procuring finance an entrepreneur has to do the following:
(i) Resource Assessment:
It refers to the activity of allocating resources to the business (whether it will be self-financed or through loan).

(ii) Capital Requirement:
It refers to the activity of ascertaining how much fixed and working capital Is needed. This depends upon the type of business.

(iii) Funds Flow:
It refers to the activity of analysing the available cash and funds.

(iv) Source of Finance:
It refers to the activity of deciding whether the source of finance will be internal or external.

(v) Means of Finance:
Borrowing is the primary means of financing.
In order to bring about a change, the following are needed by an entrepreneur:

  • Modernisation
  • Expansion
  • Diversification

(i) Modernisation:
Steps for modernisation include:

  • Conducting a research of existing situations.
  • Acquiring resources required for modernisation.
  • Following an efficient modernizing approach and carrying out modernisation.

(II) Expansion:

  • The period of expansion is the period of maturing and unfolding of the firm.
  • There is a little difference between growth and expansion.
  • Development in the internal sense is growth whereas external growth is termed as expansion.

(III) Diversification:

  • It means introduction of a new product in order to meet 1h requirements of old market.
  • Diversification is the expansion of the range of products.
  • Expansión of sale is a key goal infirm is growth phase.

Nature of Management and its Process MCQ Questions

1. Elements of business planning includes:
(a) Strategic Planning
(b) Operational Planning
(c) Both (a) and (b)
(d) None
Answer:
(c) Both (a) and (b)

2. Environmental scanning is the first step of …………………… .
(a) Strategic Planning
(b) Operational Planning
(c) Entrepreneurship
(d) None of these
Answer:
(a) Strategic Planning

3. ‘What to achieve and till when is explained by” …………………. .
(a) Objectives
(b) Mission
(c) Goal
(d) Vision
Answer:
(a) Objectives

4. Strategy implementation involves
(a) Programs
(b) Budgets
(c) Procedures
(d) All of these
Answer:
(d) All of these

5. Conversion of strategic goals into managed execution is termed as ………………….. .
(a) Innovation
(b) Strategy implementation
(c) Operational planning
(d) None of these
Answer:
(c) Operational planning

6. British economists explained entrepreneurship under head of …………………. .
(a) Business Economics
(b) Business Management
(c) Business Organisation
(d) None of these
Answer:
(b) Business Management

7. The necessity of entrepreneurship was first recognized by:
(a) Adam Smith
(b) Alfred Marshall
(c) John Mill
(d) Kizner
Answer:
(b) Alfred Marshall

8. The role of entrepreneur is that of a innovator this was claimed by-
(a) Ancient school of thought
(b) Neoclassical school of thought
(c) Modern school of thought
(d) None of these
Answer:
(c) Modern school of thought

9. The concept of creative imitation is mostly used in:
(a) Developed countries
(b) Least developed countries
(c) All the countries
(d) None of these
Answer:
(b) Least developed countries

10. Which of these is not a type of entrepreneurship?
(a) Opportunity based
(b) Need-based
(c) Situation based
(d) None of these
Answer:
(c) Situation based

11. For ………………….. time is money.
(a) Entrepreneurs
(b) Employees
(c) Competitors
(d) All of these
Answer:
(b) Employees

12. An entrepreneur has to face which of these challenges-
(a) Changing Environment
(b) Global Competition
(c) Non-Supporting Family/Friends
(d) All of these
Answer:
(d) All of these

13. Changes in production process is also referred as-
(a) Product Innovation
(b) Process Innovation
(c) Factor Innovation
(d) None of these
Answer:
(a) Product Innovation

14. Who explained the view that “Entrepreneurship is neither a science nor an art, it is a practice”?
(a) Adam Smith
(b) Peter Drucker
(c) Kizner
(d) Alfred Marshal.
Answer:
(b) Peter Drucker

15. Growth is ………………………. while expansion is ……………………..
(a) External, Internal
(b) Internal, External
(c) Static, Dynamic
(d) None of these.
Answer:
(b) Internal, External

16. ……………………….. is an increase in supply or productivity of factor.
(a) Factor innovation.
(b) Production innovation
(c) Market innovation
(d) All of these.
Answer:
(a) Factor innovation.

17. …………………….. is the process of conversion of strategic goals into managed execution.
(a) Operation Planning
(b) Strategic Planning
(c) Organising
(d) Staffing
Answer:
(a) Operation Planning

18. Which of the following is a basic type of Entrepreneurship.
(a) Opportunity based Entrepreneurship
(b) Leadership based Entrepreneurship
(c) Motivation based Entrepreneurship
(d) Skill-based Entrepreneurship
Answer:
(a) Opportunity based Entrepreneurship

19. According to Peter Drucker entrepreneurship is
(a) Science
(b) Practice
(c) Art
(d) Commerce
Answer:
(b) Practice

20. The factor which determines the mental attitude towards work and the desire to acquire money is called
(a) Cultural & Religious Factor
(b) Risk factor
(c) Capacity Factor
(d) Psychological factor
Answer:
(a) Cultural & Religious Factor

21. Borrowing money from the public is a
(a) Primary means of finance
(b) Secondary means of finance.
(c) Tertiary means of finance
(d) None of the above
Answer:
(a) Primary means of finance

22. In case of deficit budget, the cumulative amount borrowed from the public will
(a) Increase
(b) Decrease
(c) Have no effect
(d) None of the above
Answer:
(a) Increase

23. Which of the following is not included in the seven trends to be faced by an organization.
(a) Speed and uncertainty will prevail
(b) Loyalty will erode
(c) Work will be done at a specified time and place
(d) Technology will continue to disrupt and enable
Answer:
(c) Work will be done at a specified time and place

24. The first step to modernization is
(a) Research
(b) Finance
(c) Development
(d) Efficient modernizing approach
Answer:
(a) Research

25. The last step to Modernization is
(a) Development
(b) Resource Procurement
(c) Efficient modernization approach
(d) None of the above
Answer:
(c) Efficient modernization approach

26. The introduction of a new product or service to meet the needs of an old market is called
(a) Diversification
(b) Expansion
(c) Growth
(d) None of the above
Answer:
(a) Diversification

27. The basic area of focus for India to utilize its talented pools to generate good entrepreneurs is
(a) Ensuring access to the right skill
(b) Creating the right environment for success
(c) Enabling access to smart capital
(d) All of the above
Answer:
(d) All of the above

28. The formulation of effective management concentration on opportunities and threats in long-range plans is called as-
(a) Operational Planning
(b) Administration
(c) Expansion
(d) Strategic Planning
Answer:
(d) Strategic Planning

29. The first stage in the development of Entrepreneurial firm is
(a) Start up stage
(b) Seed- stage
(c) Early growth stage
(d) All of the above
Answer:
(b) Seed- stage

30. The main objective of business planning is to
(a) Prude and implement the formal and systematic business plan
(b) To expand the business
(c) To maximize profit
(d) To make the best possible use of resources
Answer:
(a) Prude and implement the formal and systematic business plan

31. As per the necessity-based entrepreneurship
(a) Entrepreneurship is necessary for the growth of the economy
(b) Choosing the entrepreneurship career is a compulsion and not a choice
(c) Both (a) and (b)
(d) Neither (a) nor (b)
Answer:
(b) Choosing the entrepreneurship career is a compulsion and not a choice

32. What is the result of modernisation?
(a) Additional burden on employees
(b) Increase in wasteful expenses
(c) Expansion of business
(d) Expansion of profit
Answer:
(c) Expansion of business:
The result of modernization is that the company would expand and will have an improved and modern material base that would both motivate employees additionally and will strengthen the production process and product quality. Thus, modernisation leads to expansion of business.

33. Introduction of new product and services and adding it to the product line is known as:
(a) Expansion
(b) Diversification
(c) Modernisation
(d) Innovation
Answer:
(b) Diversification:
The term ‘diversification’ means the introduction of a new product or service to meet the needs of an old market. It is an expansion of the range of products.

34. The necessity of entrepreneurship in production was first recognised by:
(a) Adam Smith
(b) Alfred Marshall
(c) David Ricardo
(d) John Stuart Mill
Answer:
(b) Alfred Marshall:
The necessity of entrepreneurship for production was first formally recognised by Alfred Marshall in 1890. He asserts that there are four factors of production: land; labour, capital and organization. He believed that entrepreneurship is driving element behind organization.

35. What is innovation?
(a) Bringing a change
(b) Starting a new process
(c) Introducing new idea to maximise the interests of business
(d) None of the above.
Answer:
(c) Introducing new idea to maximise the interests of business:
Innovation refers to introducing something new to maximize the interests of business. According to Peter F Drucker, innovation is a means by which entrepreneurs exploit change as an opportunity for a different business or a different service.

36. Which of the following is not an example of means of finance?
(a) Issue of equity
(b) Goods on credit
(c) Loan against shares
(d) All of these
Answer:
(c) Loan against shares:
Means of finance refers to means by which a budget deficit is financed, or a surplus is used. Means of financing are not included in the budget totals. The primary means of financing is borrowing from public which includes issue of equity, goods on credit etc. Thus, loan against shares is not a means of finance.

37. ‘Expansion’ is external and horizontal.
(a) True
(b) False
(c) It is in all direction
(d) Partly True
Answer:
(a) True:
Growth is internal or vertical surge, whereas Expansion refers to external or horizontal growth, such as that exhibited by the firm that successfully engages in mergers and acquisitions. Expansion of venture is its period of unfolding and maturation. Hence, the given statement is true.

38. Which of these four factors, Paul H. Wilken had not listed in his book?
(a) Subsequent Expansion
(b) Initial Expansion
(c) Factor Innovation
(d) Source Innovation
Answer:
(d) Source Innovation:
Paul H. Wilken in his work, Entrepreneurship: a comparative and historical study listed the following innovations by changes brought out by entrepreneurs:
– Initial expansion
– Subsequent expansion
– Factor innovation
– Production innovation
– Market innovation
Thus, source innovation is not listed in his book.

39. Leadership & managerial skill are:
(a) Interwoven to entrepreneurship
(b) Complimentary to entrepreneurship
(c) Substitute to entrepreneurship
(d) Opposite to entrepreneurship
Answer:
(a) Interwoven to entrepreneurship:
Mere building entrepreneurship process is not enough, entrepreneurs need to manage the business efficiently and effectively as well. Leadership and managerial skills are interwoven in entrepreneurship right from infant stage of an enterprise. An entrepreneur devoid of these qualities is bound to fail.

40. “What to achieve and till when” is explained by of an organization.
(a) Objectives
(b) Mission
(c) Goal
(d) Vision.
Answer:
(b) Mission:
While vision tells your ultimate goal, the mission tells how to get these. Mission explains why your business exists. It answers the following questions:
(i) What does your business do?
(ii) Who do you do it for?
(iii) Where do you exist?
(iv) How does ¡t do it?
(v) Why does your company do it? ‘
Thus, What to achieve and till when” ¡s explained by mission of an organisation.

41. A company engaged in alcohol manufacturing merged with a cigarette manufacturing firm. What type of merger is this?
(a) Horizontal merger
(b) Product extension merger
(c) Market extension merger
(d) Vertical merger.
Answer:
(b) Product extension merger:
The term diversification Is usually used to mean the introduction of a new product or service to meet the needs ot an old market. Diversification is an expansion of the range of products. It includes offering of existing product in new market, new product In old market, and new product in new market. Thus, the company is extending its product by merging to products, i.e. alcohol and cigarette. It is a product extension merger.

42. In general, Vision and Mission statements of an organisation are a result of –
(a) Operational Planning
(b) Strategic Planning
(c) Middle level Planning
(d) Performance Planning.
Answer:
(b) Strategic Planning:
Strategic planning is the key step of strategic management. Strategic plan draws the clear layout of business’s venture; vision, mission, objectives, competencies, managerial abilities, technical proficiencies and sources of funds.

43. Who among the following, first recognised the necessity of entrepreneurship for production?
(a) David Ricardo
(b) Peter F. Drucker
(c) Alfred Marshall
(d) John Stuart Mill.
Answer:
(c) Alfred Marshall:
The necessity of entrepreneurship for production was first recognised by Alfred Marshall in 1890. Marshall asserted that there are four factors of production (land, labour, capital and organisation), organisation factor is the coordinating factor that brings other factors together and entrepreneurship is driving element behind it.

44. ……………………………. claims that the role of entrepreneurs is that of innovator.
(a) Old school of thought
(b) Modern school of thought
(c) U.S. school of entrepreneurial innovation
(d) None of the above
Answer:
(b) Modern school of thought:
Modern School of thought claims that the sole of entrepreneurs is that of innovator.

45. Expansion is external and horizontal-
(a) True
(b) False
(c) It is in all direction
(d) Partly true
Answer:
(a) True
Growth is internal or vertical surge, whereas, expansion refers to external or horizontal growth, such as exhibited by the firm that successfully engages in mergers and acquisitions. Expansion of venture is its period of unfolding and maturation. Hence, the given statement is true.

46. Environmental Scanning is the first step of –
(a) Strategic Planning
(b) Operational Planning
(c) Entrepreneurship
(d) None of the above
Answer:
(a) Strategic Planning:
Strategic Planning is the key step of strategic management. It includes following steps:
(i) Environmental Scanning
(ii) Strategy Formulation
(iii) Strategy Implementation
(iv) Evaluation and Control.
Thus, environmental scanning is the first step of strategic planning.

47. Appointing a manager under some strategic decision is covered under:
(a) Strategy formulation
(b) Environment scanning
(c) Strategy implementation
(d) Strategic planning.
Answer:
(c) Strategy implementation:
Strategy implementation is the process of conducting program & (activities needed to accomplish a plan), budgets (cost of the programs), and procedures (sequence of steps needed to do the job) and it is required to be done by an officer or a manager. So, appointing a manager under some strategic decisions is covered under strategy implementation.

48. Nodu, a chocolate manufacturer based in Singapore, produces candy containing exotic ingredients from rain forests of Brazil. The ingredients are provided by a single supplier who has an exclusive control with Nodu. The chocolate manufacturer thus has a great deal of power over the market. This is an example of:
(a) Strategic vision
(b) Distinctive competence
(c) Competitive advantage
(d) Strategic management.
Answer:
(b) Distinctive competence:
Distinctive competence of a firm refers to a set of activities or capabilities that a company is able to perform better than its competitors and which gives it an advantage over them. Thus, the chocolate manufacturer has a great deal of power over the market and this comes under the example of distinctive competence.

49. In business parlance, growth is and expansion refers to
(a) External and horizontal growth internal and vertical growth
(b) External: external growth as well
(c) Internal: Internal growth as well
(d) Internal and vertical: external and horizontal growth.
Answer:
(d) Internal and vertical: external and horizontal growth:
Growth is internal or vertical surge, whereas Expansion refers to external or horizontal growth, such as that exhibited by the firm that successfully engages in mergers and acquisitions. Expansion of venture is its period of unfolding and maturation. Hence, option D is correct statement.

50. Constraints on time, money and resources are managed in:
(a) Operational Planning
(b) Strategic Planning
(c) Capital Budgeting
(d) Market Research.
Answer:
(a) Operational Planning:
Operational planning requires proactive thinking to enact strategy within the operational layer of the business. Operational planning must produce the plan outcomes while managing constraints on time, money and resources.

51. The primary motivating force behind entrepreneurs is:
(a) Fame
(b) Money
(c) Recognition
(d) Achievement.
Answer:
(d) Achievement:
McClelland emphasizes that achievement orientation is the prime factor that explains economic behaviour of entrepreneurs. It means the quest for success in relation to preset standards of excellence. He measures interest of entrepreneurs in terms of profit or achievement motive which remains constant regardless of change in events.

52. Key goal in the firms growth phase is:
(a) Expansion of capital
(b) Cutting costs
(c) Expansion of profit
(d) Expansion of sales.
Answer:
(d) Expansion of sales.
In order to bring effecting change in the business growth, the following are needed by an entrepreneur:

  • Modernisation
  • Expansion
  • Diversification

All these moves have a common thing that is an attempt to increase sale by expanding selling possibilities and the expansion of sales is a key goal in the firm’s growth phase.

53. If a business is very complex, it will only grow successfully if the entrepreneur:
(a) Is comfortable giving up control to professional management
(b) Keeps everything under his control
(c) Uses the classic entrepreneurial management style
(d) Is a Craftsman
Answer:
(a) Is comfortable giving up control to professional management:
If a business is very complex it will only grow successfully if the entrepreneur is comfortable giving up control to professional management.

54. The process of determining whether an entrepreneur’s idea is a viable foundation for creating a successful business is known as a:
(a) Strategic analysis
(b) Business plan
(c) Feasibility analysis
(d) Industry analysis
Answer:
(c) Feasibility analysis:
Feasibility analysis is the process of determining whether an entrepreneur’s idea is a viable foundation for creating a successful business.

55. SMART Capital indicates what?
(a) Resource assessment
(b) Venture capitalist
(c) Networking & exchanging
(d) None of the above
Answer:
(a) Resource assessment:
If a business is very complex It will only grow successfully if the entrepreneur is comfortable giving up control to professional management.

56. Assessment of competitive rivalry does not include an understanding of:
(a) The extent to which competitors are in balance
(b) Market growth rate
(c) Fixed costs, exit barriers and operational efficiency
(d) The management structure of an organization
Answer:
(c) Fixed costs, exit barriers and operational efficiency:
Feasibility analysis Is the process of determining whether an entrepreneur’s idea is a viable foundation for creating a successful business.

57. SMART Capital indicates what?
(a) Resource assessment
(b) Venture capitalist
(c) Networking & exchanging
(d) None of the above
Answer:
(b) Venture capitalist:
Entrepreneurs must have access to ‘Smart’ Capital. In the last few years, several venture funds have entered the Indian Market. Venture capital’ are providing capital as well as critical knowledge and access to potential partners, suppliers and clients across the globe. So, Smart capital indicates venture capital.

58. Assessment of competitive rivalry does not include an understanding of:
(a) The extent to which competitors are in balance
(b) Market growth rate
(c) Fixed costs, exit barriers and operational efficiency
(d) The management structure of an organization
Answer:
(d) The management structure of an organization:
Assessment of competitive rivalry includes:

  • Market growth
  • The extent to which competitors are in balance.
  • Fixed costs, exit barriers and operational efficiency
  • Alternative choice of goods.

It does not include, the management structure of an organization. So, option (d) is not included.

59. The Evaluation Criteria for the new product should include all of the following except ………………. .
(a) Product should be profitable
(b) Pricing and marketing policies of other firms
(c) Determination of market demand
(d) Determination of the suppliers.
Answer:
(d) Determination of the suppliers:
Evaluation criteria for a new product include its profitability, pricing and marketing policies market demand which thereby strongly influence the goal to achieve.

60. A(n) ………………………. industry is an industry that is experiencing slow or no increase in demand.
(a) Mature
(b) Emerging
(c) Global
(d) Declining
Answer:
(b) Emerging:
After becoming mature, the industry experience slow or no growth in demand.

61. Which of the following is not a Characteristic of Strategic Management?
(a) It is concerned with only the analysis of past happenings in the organization
(b) It has an external focus
(c) It has an internal focus
(d) It is interdisciplinary.
Answer:
(a) It is concerned with only the analysis of past happenings in the organization:
Characteristic of Strategic Management:

  • It is future oriented and uncertain
  • It deals with internal as well as external environment
  • It has the organisation-wide approach
  • It is fundamental for improving long term performance
  • It deals with vision, mission and objectives
  • It is interdisciplinary.

62. If a business is very complex, it will only grow successfully if the entrepreneur:
(a) is comfortable giving up control to professional management
(b) is a craftsman
(c) keeps everything under his control
(d) uses the classic entrepreneurial management style.
Answer:
(a) is comfortable giving up control to professional management:
If a business is very complex, it will only grow successfully if the entrepreneur is comfortable in giving up control to professional management.

63. The ………………………………. entrepreneur goes into business as a result of financial hardship or other negative conditions.
(a) Educated
(b) Necessity based
(c) Refugee
(d) Corporate supported
Answer:
(b) Necessity based:
An Entrepreneur is left with no other viable option to earn a living. A necessity-based entrepreneur operates not by choice but out of compulsion may be due to financial hardship or other negative condition.

64. Making the comparison of actual performance with set standard is covered in:
(a) Strategic planning
(b) Strategy implementation
(c) Evaluation and Control
(d) Environment scanning
Answer:
(c) Evaluation and Control:
The main objective of the business planning is to provide and implement the systematic business plan. The one such action under the business planning is evaluation and control where the performance is measured by comparing the actual results with the set standards.

65. Which of the following is not a stage of development in entrepreneurial firm?
(a) Start rolling
(b) Startup
(c) Early growth
(d) Seed Stage
Answer:
(a) Start rolling:
The stages of development in entrepreneurial firm are seed stage, start-up, early growth, established and corporate. Hence, start rolling is not a stage in the development in the entrepreneurial firm.

66. When advising John of what to include in the production plan of his business plan for his entrepreneurial venture, what would you not include in your recommendation?
(a) Product price
(b) Physical plant location
(c) Names of suppliers of raw materials
(d) Manufacturing process
Answer:
(c) Names of suppliers of raw materials:
On advising John, the names of the suppliers of the raw material should be excluded from the recommendations as the other factors such as product price, manufacturing process and the plant location should be given priority in making the venture successful.

67. Entrepreneur’s rate of a disturbance handler, Allocator of resources and negotiator’s role are ………………………… roles that the manager has to perform.
(a) Interpersonal
(b) Decisional
(c) International
(d) None of the Above.
Answer:
(a) Interpersonal:
Entrepreneur’s role of a disturbance handler, Allocator of resources and negotiator role are the interpersonal roles that Manager has to performs.

68. Which one of the following is Correct About business plan?
(a) Business plan is necessary only for big companies
(b) Business plan is substitute for strategic planning
(c) Business plan is substitute for strategic planning
(d) Business plan should emphasize on ideas and concepts only.
Answer:
(b) Business plan is substitute for strategic planning:
It is true that business plan is substitute for strategic planning. If strategic planning is not working, then success can be got by working on business plans.

60. The necessity of entrepreneurship for production was first formally recognised by Alfred Marshall in the year:
(a) 1890
(b) 1892
(c) 1891
(d) 1893
Answer:
(a) 1890:
The necessity of entrepreneurship for production was first formally recognized by Alfred Marshall in 1890. In his famous treatise principles of Economics, Marshall asserts that there are fours factors of production; land, labour, capital and organization.

CS Foundation Business Management Ethics and Entrepreneurship Notes