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Entrepreneurship : CUET Mock Test - 1 for CUET Commerce 2024 is part of Entrepreneurship Practice Tests: CUET Preparation preparation. The Entrepreneurship : CUET Mock Test - 1 questions and answers have been prepared according to the CUET Commerce exam syllabus.The Entrepreneurship : CUET Mock Test - 1 MCQs are made for CUET Commerce 2024 Exam. Find important definitions, questions, notes, meanings, examples, exercises, MCQs and online tests for Entrepreneurship : CUET Mock Test - 1 below.
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Entrepreneurship : CUET Mock Test - 1 - Question 1

Match the items of List - I with that of List - II and suggest the correct code:

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 1

(a) Customary pricing: Customary pricing is a pricing method where the price of a good or service is based on consumers' collective perception of its value.
(b) Skimming : Price skimming is a pricing strategy in which a marketer sets a relatively high initial price for a product or service at first, then lowers the price over time. It is a temporal version of price discrimination/yield management.
(c) Penetration pricing: Penetration pricing is a pricing strategy where the price of a product is initially set low to rapidly reach a wide fraction of the market and initiate word of mouth. The strategy works on the expectation that customers will switch to the new brand because of the lower price.
(d) Psychological pricing: It is a pricing and marketing strategy based on the theory that certain prices have a psychological impact. For example, ending a price with 99 paise.

Entrepreneurship : CUET Mock Test - 1 - Question 2

Evergreening of Patents means

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 2

Evergreening is extending the life span of a patent for a very long duration of time even after it has expired. This is specially done in case of pharma patents. The therapeutic value of drugs are enhanced before the term of the patent expires. This makes it eligible to get patent for another term, thereby maintaining the monopoly over the product. Evergreening is referred to the practice whereby pharmaceutical firms extend the patent life of a drug by obtaining additional 20-year patents for minor reformulations or other iterations of the drug, without necessarily increasing the therapeutic efficacy.

Entrepreneurship : CUET Mock Test - 1 - Question 3

For the following two statements, choose the correct option.
Assertion (A): Planning is closely connected with creativity and innovation.
Reason (R): For planning we need to think differently, that is why it is closely connected with creativity and innovation.

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 3

Planning is deciding in advance what to do and how to do. Before doing something, the manager must formulate an idea of how to work on a particular task according to the task and situation. Thus, planning is closely connected with creativity and innovation as a plan has to be formulated for every task according to the situation.

Entrepreneurship : CUET Mock Test - 1 - Question 4

Member of a Hindu Undivided Family is called:

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 4

Under the Hindu Law, the 'coparcener' is a term to indicate those male members of a Hindu family who have an undivided interest over the ancestral property by birth. They are the head of the family or Karta and the three subsequent generations of the Karta which include his sons, grandsons, and great-grandsons.

Entrepreneurship : CUET Mock Test - 1 - Question 5

A company has total investment of Rs 70,00,000 and seeks to earn 30% (before tax) return on investment. It expects to sell 20,000 units and total cost per unit is Rs. 50. The selling price (Rs.) per unit is:

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 5

It would be Rs. 155 per unit. Total Cost of 20,000 units @ Rs. 50 per unit = Rs. 10,00,000

Total = Rs. 10,00,000 + Rs. 21,00, 000 = Rs. 31,00,000
Price per unit = Rs. 31,00,000/20,000 = Rs. 155

Entrepreneurship : CUET Mock Test - 1 - Question 6

Demographic trends are a part of

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 6

Demographic trends are concerned with population, so they are related to social environment. Social Environment includes all the social and cultural forces within which the business firms operate. Size and distribution of population, age compositions, male-female ratio etc. are all related to social environment. Hence, option 3 is correct.

Entrepreneurship : CUET Mock Test - 1 - Question 7

In India, mergers and acquisition of firms are regulated by

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 7

Mergers, amalgamations and acquisitions in India are regulated by the Competition Commission of India (CCI).
CCI is the statutory authority responsible for reviewing combinations and assessing whether or not they cause or are likely to cause an appreciable adverse effect on competition within the relevant market(s) in India.

Entrepreneurship : CUET Mock Test - 1 - Question 8

What is consolidation?

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 8

Consolidate (or consolidating) is to merge two or more entities, assets, liabilities, and other financial items into one. Consolidation also applies to mergers and acquisitions (M&A) that unify smaller companies into more substantial corporations.

Entrepreneurship : CUET Mock Test - 1 - Question 9

What is the main motive of Public Relations?

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 9

Public relations (PR) is the process of maintaining a favorable image and building beneficial relationships between an organization and the public communities, groups, and people it serves. The main motive of Public Relations is to generate goodwill among consumers, the media, and other target audiences by raising the organization's profile. Therefore, option 2 is correct.

Entrepreneurship : CUET Mock Test - 1 - Question 10

Bharat Company Ltd. was earlier producing washing soaps, now it has decided to further venture into the field of shampoos and detergents.
What do you think is the company attempting to do?

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 10

The concept is diversification. It is a process of adding new products or markets to the existing by an enterprise. Here, the enterprise thus is able to produce more types of products, e.g. not only washing soap but shampoos and detergents are also produced.
A product extension merger takes place between two business organisations that deal in products that are related to each other and operate in the same market. The product extension merger allows the merging companies to group together their products and get access to a bigger set of consumers. This ensures that they earn higher profits, e.g. the acquisition of Mobilink Telecom Inc. by Broadcom.

Entrepreneurship : CUET Mock Test - 1 - Question 11

What does AIDA stand for?

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 11

AIDA stands for Attention, Interest, Desire and Action. This is the model widely used for marketing and advertising the products that covers the stages from making aware the customers about the products to urging them to choose the particular brand or make purchase decision.

Entrepreneurship : CUET Mock Test - 1 - Question 12

Directions: Read the information given below and answer the question that follows.
Broadcom deals in the manufacturing of Bluetooth personal area network hardware systems and chips for IEEE 802.11b wireless LAN. Mobilink Telecom Inc. deals in the manufacturing of product designs meant for handsets that are equipped with the Global System for Mobile Communications technology. It is expected that the products of Mobilink Telecom Inc. would be complementing the wireless products of Broadcom. Hence, Broadcom acquired Mobilink Telecom Inc.
Considering the above case, identify the type of merger.

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 12

A product extension merger takes place between two business organisations that deal in products that are related to each other and operate in the same market. The product extension merger allows the merging companies to group together their products and get access to a bigger set of consumers. This ensures that they earn higher profits, e.g. the acquisition of Mobilink Telecom Inc. by Broadcom.
A horizontal merger is a merger between firms that produce and sell same products, i.e. between competing firms.
A vertical merger is a merger between firms operating at different stages of production, e.g. from raw materials to finished products to distribution. An example would be a steel manufacturer merging with an iron ore producer.
A conglomerate merger is a merger between firms that are involved in totally unrelated business activities.

Entrepreneurship : CUET Mock Test - 1 - Question 13

The executive summary of business plan should be prepared

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 13

The executive summary of business plan should be prepared after the entire business plan has been written. The executive summary should include important details that are relevant to the reader based on the purpose of business plan. For example, if the goal of the business plan is to secure an investor, then one should emphasise the financial requirements and how he or she will use the funding.

Entrepreneurship : CUET Mock Test - 1 - Question 14

If unit item cost = Rs. 10, monthly carrying charge = 3 per cent, monthly demand = 100 units, and ordering cost = Rs. 20 per order, the EOQ is:

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 14

EOQ = 
C = cost = Rs. 10
A = monthly demand = 100 units
O = ordering cost = Rs. 20
I = carrying charge = 3 per cent

Entrepreneurship : CUET Mock Test - 1 - Question 15

Which one of the following is correct about business plan?

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 15

A business plan is a document that summarises the operational and financial objectives of a business and contains the detailed plans and budgets showing how the objectives are to be realised. Business plan include the overall budget, current and projected financing needs, a market analysis, growth path and the company's marketing strategy.

Entrepreneurship : CUET Mock Test - 1 - Question 16

Which of the following statements are correct?
A. Entrepreneurs identify business opportunities and assemble the resources and capabilities needed to create value.
B. Entrepreneurs are both owners and managers of the business, so they are more likely to take calculated risks to pursue business opportunities.
C. Entrepreneurs have little motivation to pursue innovative commercial opportunities that have risk associated with them.

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 16

Entrepreneurs identify business opportunities and assemble the resources and capabilities needed to create value. Entrepreneurs are both owners and managers of the business, so they are more likely to take calculated risks to pursue business opportunities. Entrepreneurs have the capability and motivation to pursue innovative commercial opportunities that are riskier and more radical than normal. Hence, option 2 is the right answer.

Entrepreneurship : CUET Mock Test - 1 - Question 17

Which of the following is not the purpose of Cash Flow Projection?

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 17

Cash Flow Statement, like Balance Sheet and Income Statement, deals with the past. It does not help in managing the current, day to day requirement. Cash Flow Projection, on the other hand, is a very critical management tool for the successful operation of the business. Cash Flow Projection shows how cash is expected to flow in and out of your business. Hence, option 2 is the answer.

Entrepreneurship : CUET Mock Test - 1 - Question 18

Directions: Read the information given below and answer the question that follows.
Ramesh buys a financial asset from the RBI. This financial asset is an instrument of short-term borrowing. He has bought it because he doesn't want to take risk and wants an assured return. This instrument is highly liquid. This instrument is also known as Zero Coupon Bond. On this instrument is written T-91.

Q. Which of the following financial assets has been discussed in the above case?

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 18

The financial asset which is indicated in the given case is 'Treasury Bill'. The RBI issues this instrument on the behalf of the Government of India. The instrument is called Zero Coupon Bond because the interest rate given by the bank is not given openly. The interest in fact comes in the form of discount which is given on the face value. The instrument is redeemed at par (on the written face value). So, the instrument is issued at discount. T-91 here denotes the maturity period of the Treasury Bill which is 91 days in this case.

Entrepreneurship : CUET Mock Test - 1 - Question 19

Which among the following deal in Mutual Fund, Hire Purchase, Leasing & Venture Capital?

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 19

A Non-Banking Financial Company (NBFC) is a company engaged in the business of loans and advances, acquisition of shares/stocks/bonds/debentures/securities issued by Government or local authority or other marketable securities of a like nature, leasing, hire-purchase, insurance etc. Hence, option 2 is the correct answer.

Entrepreneurship : CUET Mock Test - 1 - Question 20

The company has been buying an item in lots of 2,400 units which is six months' supply. The cost per unit is Rs. 12, order cost is Rs. 8 per order and the carrying cost is 25%. The Economic Order Quantity is:

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 20

Quantity demanded (D) for 6 months = 2400
Quantity demanded (D) for 1 year = 2400 × 2 = 4800
Order Cost (CO) is Rs. 8.
Carrying Cost (CC) = 25% of 12 = 3
EOQ = 

Entrepreneurship : CUET Mock Test - 1 - Question 21

Human resource planning system includes

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 21

Human resource planning ensures the best fit between employees and jobs while avoiding manpower shortages or surpluses. There are four key steps of the HRP process. They include analysing present labour supply, forecasting labour demand, balancing projected labour demand with supply, and supporting organisational goals.

Entrepreneurship : CUET Mock Test - 1 - Question 22

Who was the first person to coin the term Angel Investor?

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 22

William Wetzel, the founder of the Center for Venture Research, coined the term Angel Investors after completing his research at the University of New Hampshire on how entrepreneurs raise capital. An individual who invests in small start-ups or entrepreneurships is called an Angel Investor.

Entrepreneurship : CUET Mock Test - 1 - Question 23

CRM stands for

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 23

Customer Relationship Management is a process in which a business or other organisation administers its interactions with customers, typically using data analysis to study large amounts of information.

Entrepreneurship : CUET Mock Test - 1 - Question 24

Which among the following is not correct in the context of branding of products?

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 24

A brand (or marque for car model) is a name, term, design, symbol or other feature that distinguishes one seller's product from those of others. Brands are used in business, marketing and advertising. Initially, livestock branding was adopted to differentiate one person's cattle from another's by means of a distinctive symbol burned into the animal's skin with a hot branding iron.

Entrepreneurship : CUET Mock Test - 1 - Question 25

Capital market comprises

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 25

Capital markets consist of the primary market, where new securities are issued and sold, and the secondary market, where already-issued securities are traded between investors. The most common capital markets are the stock market and the bond market.

Entrepreneurship : CUET Mock Test - 1 - Question 26

Directions: Read the information given below and answer the question that follows.
Ragini Auto manufacturers have decided to give a special privilege to the existing shareholders to subscribe to the new issue of shares where they will be given shares according to the proportion of shares held by them. The company always gives special treatment to loyal stakeholders. Last year, the company was dealing through the capital market where both the buying and selling of securities were taking place. The owner of the company is a man of ethical business. He recently wrote an article about the watchdog of stock market. The article gained a lot of popularity and now is part of the curriculum of MBA students.

Q. Which method of floatation is used by Ragini Auto manufacturers?

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 26

The method of floatation used by the company is 'Rights Issue'. Ragini Auto manufacturers have decided to give a special privilege to the existing shareholders to subscribe to the new issue of shares where they will be given shares according to the proportion of shares held by them.
In the 'Rights Issue' method of floatation, the company issues new shares that are available only to a group of existing investors, who are given the opportunity to purchase new shares before the shares officially get offered to the public.

Entrepreneurship : CUET Mock Test - 1 - Question 27

Under the Indian Partnership Act, 1932, where no provision is made by contract between the partners for the duration of their partnership or for the determination of their partnership, the partnership is called:

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 27

Section 7 of Indian Partnership Act, 1932, defines "PARTNERSHIP-AT-WILL". According to it, where no provision is made by contract between the partners for the duration of their partnership, or for the determination of their partnership, the partnership is "partnership-at-will".

Entrepreneurship : CUET Mock Test - 1 - Question 28

Which among the following are some of the main features of a `Limited Liability Partnership`?

  1. The partners have the right to manage the business directly.
  2. Minimum 2 partners are required and there is no limit on maximum.
  3. It encourages smaller business entities to undertake larger ventures.
Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 28

Limited Liability Partnership is a partnership in which some or all partners (depending on the jurisdiction) have limited liability. It therefore exhibits elements of partnerships and corporations. In an LLP, one partner is not responsible or liable for another partner's misconduct or negligence. In an LLP, some partners have a form of limited liability similar to that of the shareholders of a corporation. Its major features are:

  1. The partners have the right to manage the business directly.
  2. Minimum 2 partners are required and there is no limit on maximum.
  3. It encourages smaller business entities to undertake larger ventures.

Hence, all the three statements are correct.

Entrepreneurship : CUET Mock Test - 1 - Question 29

In capital market, the term 'arbitrage' is used in reference to

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 29

The term 'arbitrage' refers to the simultaneous buying and selling of securities, currency, or commodities in different markets or in derivative forms in order to take advantage of differing prices for the same asset. It is a trade that profits by exploiting the price differences of identical or similar financial instruments on different markets or in different forms.

Entrepreneurship : CUET Mock Test - 1 - Question 30

SWOT analysis refers to an analysis of a company's

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 30

SWOT analysis is a framework for identifying and analyzing an organization's strengths, weaknesses, opportunities and threats. The primary goal of SWOT analysis is to increase awareness of the factors that go into making a business decision or establishing a business strategy. To do this, SWOT analyzes the internal and external environment and the factors that can impact the viability of a decision. Hence, option 2 is correct.

Entrepreneurship : CUET Mock Test - 1 - Question 31

In which of the following types of market do the sellers not spend much in the marketing strategy?

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 31

In Pure Competition, the buyers and sellers trade in uniform commodity such as wheat, iron or financial securities etc. A seller cannot change the prevailing price, because buyer can obtain the same commodity as much as he needs from other seller at the going price. Thus, the sellers do not spend much on marketing strategy like sales promotion, advertising, product development etc.

Entrepreneurship : CUET Mock Test - 1 - Question 32

_____ is a near term, mission-specific plan that expresses how the organization's leadership plans to deploy, operate and support existing assets to achieve organizational objectives allocated from the strategic plan within time frame, typically of one year or less, and resource constraints.

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 32

Tactical plan is a near term, mission-specific plan that expresses how the organization's leadership plans to deploy, operate and support existing assets to achieve organizational objectives allocated from the strategic plan within time frame, typically of one year or less, and resource constraints. Tactical plans are developed by middle managers after consulting lower-level managers. These plans are more specific and concrete than strategic plans.

Entrepreneurship : CUET Mock Test - 1 - Question 33

Which of the following is a primary activity in a value chain?

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 33

A value chain is a step-by-step business model for transforming a product or service from idea to reality.
The primary activities in a value chain are:

  1. Inbound Logistics
  2. Operations
  3. Outbound Logistics
  4. Marketing and Sales
  5. Service
Entrepreneurship : CUET Mock Test - 1 - Question 34

Arrange the channels of distribution for consumer goods from first to the last stage.
I. Consumer
II. Wholesaler
III. Manufacturer
IV. Retailer

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 34

In case of consumer goods, the wholesalers buy the bulk from the manufacturers, break it down into small packages, and sell them to retailers who eventually sell them to the end customers. Hence, option 3 is the correct answer.

Entrepreneurship : CUET Mock Test - 1 - Question 35

Directions: Read the information given below and answer the question that follows.
Riya did her post-graduation from Manipur University, Imphal. She had offers to join reputed firms in metropolitan cities like Delhi and Mumbai. Instead of joining any of these firms, she decided to do some creative work in Imphal. She observed that a special type of chilli is grown by the farmers of most of the villages around Imphal. This chilli has a distinct flavour and the pickle made from it has a taste that may be liked by many people in other parts of the country. But the farmers were neither trained in the farming of this kind of chilli on a large scale, nor was there a secured market for their produce. Riya met eighteen like-minded women of the area and formed an organisation for doing the business of pickle manufacturing. Each of them contributed 2,00,000 towards its capital and were equally responsible for its management. On one hand, they assured the farmers to purchase the chilli produced by them and on the other hand, the organisation with the help of the local agriculture department arranged for the training of the farmers. They also employed 10 local unemployed graduate girls for doing the various operations of pickle manufacturing.

Q. What kind of organisation had Riya decided to set up?

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 35
  • 'Riya met eighteen like-minded women of the area and formed an organisation for doing the business of pickle manufacturing. Each of them contributed 2,00,000 towards its capital and were equally responsible for its management.'
  • So, the kind of organisation that Riya had decided to set up was 'partnership'. A partnership in business is a formal agreement made by two or more parties to jointly manage and operate a company.
  • A sole proprietorship is an enterprise owned exclusively by one natural person and in which there is no legal distinction between the owner and the business entity. (The members were equally responsible for the management.)
  • A joint-stock company is a business entity in which shares of the company's stock can be bought and sold by shareholders. The company was established with equal contribution of different investors. No shares were traded.
  • The cooperative society is a voluntary association of persons, who join together with the motive of the welfare of the members. They are driven by the need to protect their economic interests in the face of possible exploitation at the hands of middlemen obsessed with the desire to earn greater profits. This is not inferable from the text.
Entrepreneurship : CUET Mock Test - 1 - Question 36

Which of the following statements about product/trademark franchising is correct?

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 36

A product and trademark franchise is an arrangement under which the franchisor grants to the franchisee the right to buy its products and use its trade name. This approach typically connects a single manufacturer with a network of dealers or distributors. Hence, option 1 is correct.

Entrepreneurship : CUET Mock Test - 1 - Question 37

Arrange the entrepreneurial motivation factors on the basis of proper sequences.

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 37

Entrepreneurial motivation is the process of transforming an ordinary individual to a powerful businessman, who can create opportunities and helps in maximising wealth and economic development. It defines that various factors stimulate desires and activate enthusiasm in entrepreneurs which make them attain a particular goal. Entrepreneurial motivation is based on several factors such as need for achievement, locus of control, vision, desire for independence, passion and drive, respectively.

Entrepreneurship : CUET Mock Test - 1 - Question 38

About 50 items are required every day for a machine. A fixed cost of Rs. 50 per order is incurred for placing an order. The inventory carrying cost per item amounts to Rs. 0.02 per day.
The lead period is 32 days.
Compute EOQ:

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 38

Economic order quantity = 

= 500 units

Entrepreneurship : CUET Mock Test - 1 - Question 39

'Venture Capital' refers to the

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 39

'Venture Capital' refers to the capital invested in emerging and initial stage of firms. This investment is done in initial stage of a company, so it has maximum/high potential of growth.

Entrepreneurship : CUET Mock Test - 1 - Question 40

______ is the last section of marketing plan that outlines the controls for monitoring and adjusting implementation of the plan.

Detailed Solution for Entrepreneurship : CUET Mock Test - 1 - Question 40

Implementation control is the last section. This section outlines the controls for monitoring and adjusting implementation of the plan, where the goals and budget are spelled out for each month or quarter, so management can review each period's result.

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