Class 12 Entrepreneurship: CBSE Sample Question Papers- Term I (2021-22)- 2 | Sample Papers for Class 12 Commerce PDF Download

General Instructions:
1. The Question Paper contains three sections.
2. Section - A has 24 questions. Attempt any 20 questions.
3. Section - B has 24 questions. Attempt any 20 questions.
4. Section - C has 12 questions. Attempt any 10 questions.
5. All questions carry equal marks.
6. There is NO negative marking.

Q.1: Public sector enterprise is owned and controlled by:
(a) General Public
(b) Government
(c) Foreign Investors
(d) Domestic Institutions 

Correct Answer is Option (b)
Public Sector enterprises are fully owned and controlled by the government.

Q.2: ________ will help the entrepreneur to understand the market and produce goods or provide services in sync with the market.
(a) Opportunity
(b) Trend spotting
(c) Brainstorming
(d) Both (b) & (c)

Correct Answer is Option (b)
Trend spotting means identification of new trends. This will help the entrepreneur to understand the market and produce goods or provide services in sync with the market trends.

Q.3: Which of these are not part of micro environment?
(a) Suppliers
(b) Customers
(c) Government
(d) General public 

Correct Answer is Option (c)
Business micro-environment includes:
(a) Suppliers
(b) Customers
(c) Intermediaries
(d) Competitors
(e) General public

Q.4: Introduction of mobile phones have negatively affected the business of cameras and watches. Which micro environment factor is indicated in the above mentioned lines?
(a) Technological factor
(b) Social factor
(c) Political factor
(d) Legal factor 

Correct Answer is Option (a)
Technological factor includes nature of technology, rate of technology transfer, new discoveries, research and development etc.

Q.5: Warren Buffet reads five newspapers daily in the morning and business magazines in his office to stay updated with new things about the market to make his decisions. What type of trend does he follow?
(a) Talk trend
(b) Read trend
(c) Watch trend
(d) Think trend

Correct Answer is Option (b)
Read trend includes reading publications, websites, newspapers, etc. in order to obtain the necessary information.

Q.6: Which of the following PESTEL model factor is indicated in the below mentioned lines? "Kashmiris do not prefer to wear western dress".
(a) Technological factor
(b) Social factor
(c) Political factor
(d) Legal factor 

Correct Answer is Option (b)
The social environment factors include population demographics, income distribution, lifestyle changes, level of education and attitudes of people towards work and leisure.

Q.7: Before selecting an opportunity, the entrepreneur has to ensure:
(a) There is a good market for the product
(b) The rate of return on the investment is attractive
(c) Both (a) and (b)
(d) None of these 

Correct Answer is Option (c)
Before selecting an opportunity, the entrepreneur has to ensure two things:
• There is a good market for the product he is going to produce.
• The rate of return on the investment is attractive to be accepted by him.

Q.8: Entrepreneur is the person and the entrepreneurship is the process. What is the outcome of person doing the process?
(a) Business
(b) Enterprise
(c) Risk
(d) Profit 

Correct Answer is Option (b)

Q.9: Shivjot Singh is an innovative person and he thinks of building eco-friendly houses. These houses will remain cool in summers and hot in winters. He conceived the idea in 2005 but it could be completed in 2015. Identify which stage of creative process is this.
(a) Doing Market Research
(b) Idea Germination
(c) Brain storming
(d) Using hobbies to generate ideas 

Correct Answer is Option (b)
Idea germination is a process in which an entrepreneur creates, develops, and communicate ideas. It refers to giving birth to a creative idea, innovate the concept, develop the process and bring the concept to reality.

Q.10: Entrepreneur perceives opportunity from:
(a) Problem
(b) Needs
(c) Both (a) and (b)
(d) None of these 

Correct Answer is Option (c)

Q.11: Which of the following is economic factor?
(a) Population demographics
(b) Level of education
(c) Unemployment
(d) Attitude toward work 

Correct Answer is Option (c)
Economic refers to factor and forces concerning means of production and distribution of wealth. It consists of gross national products corporate profit, inflation rate, productivity, employment rate, balance of payment, interest rate, tax rate, consumer' income, debt and spendings, etc.

Q.12: Which of the following is an example of variable cost?
(a) Raw material
(b) Commission on sales
(c) Packing material
(d) All of these

Correct Answer is Option (d)

Q.13: Which of the following is the feature of sole proprietorship?
(a) Limited liability
(b) Difficult to form
(c) Difficult to close
(d) Individual management and control 

Correct Answer is Option (d)
Form of business organization which is owned financed, controlled and managed by only one person is called as sole proprietorship. All investment is made by the proprietor. The sole proprietor alone is entitled to all the profits and losses of business.

Q.14: The uncertainty of the business is known as:
(a) Profit
(b) Risk
(c) Reward
(d) Opportunity 

Correct Answer is Option (b)
Business involves risk i.e., uncertainty. 'Higher the risk, higher the profit' goes the old proverb.

Q.15: _____________________ is the activity or process of buying, selling, or exchanging goods or services.
(a) Trading
(b) Service
(c) Manufacturing
(d) None of these 

Correct Answer is Option (a)
Trading involves buying and selling of goods.

Q.16: Which of these is not the part of the creative process?
(a) Idea germination
(b) Incubation
(c) Verification
(d) None of these 

Correct Answer is Option (d)
The creative process includes – Idea, Germination, Preparation, Incubation, Illumination and Verification.

Q.17: Gopesh and his friends started an organisation where they used to invest money monthly their main aim was not profit but to help any of its members when they were in need. What type of organisation is this?
(a) Partnership
(b) Mutual fund
(c) Co-operative organisation
(d) Joint stock company

Correct Answer is Option (c)
A co-operative is a different form of business enterprise as here; the main motive is not earning profit but mutual help. It works with the principle of each for all and all for each.

Q.18: A business plan is a _____________________.
(a) It is a comprehensively written down document.
(b) It is a roadmap required by the venture.
(c) It is a formal statement of a set of business goals to be achieved by the enterprise.
(d) All of these. 

Correct Answer is Option (d)

Q.19: Which of the following is a feature of Joint stock company?
(a) Voluntary association
(b) Artificial person
(c) Separate legal entity
(d) All of these 

Correct Answer is Option (d)

Q.20: An entrepreneur ensures the type of technology required to produce the product and its availability. What type of feasibility study is this?
(a) Economic Feasibility
(b) Financial Feasibility
(c) Technical Feasibility
(d) None of these 

Correct Answer is Option (c)
The type of technology required to produce the product and its availability must be ensured. This study is called technical feasibility.

Q.21: What does total cost include?
(a) Only variable cost
(b) Only fixed cost
(c) Both variable and fixed cost
(d) None of these 

Correct Answer is Option (c)
Total cost is the sum of all costs incurred by a firm in producing a certain level of output. It consists of variable costs and fixed costs. Variable costs vary directly with the level of output. It includes the expenditure on raw materials, transportation, etc. Fixed costs are not dependent on the level of output. These are period costs. They include interest, rent, salary of permanent workers, etc.

Q.22: Unit Price =
(a) Total sales / No. of units sold
(b) Total sales × No. of units sold
(c) Total sales – No. of units sold
(d) Total sales + No. of units sold 

Correct Answer is Option (a)
Price for one item is known as unit price.

Q.23: Which type of business activity includes transforming of raw materials into finished products?
(a) Manufacturing
(b) Trading
(c) Services
(d) All of these 

Correct Answer is Option (a)
Manufacturing business activities convert raw materials into finished products.

Q.24: A company must be registered under:
(a) Companies Act, 1992
(b) Companies Act, 1957
(c) Companies Act, 2015
(d) Companies Act, 2013

Correct Answer is Option (d)
A company should be legally registered under Companies Act, 2013 (previously Companies Act, 1956).

Q.25: Amit has just passed the examination and become a chartered accountant. He wanted to work and earn money from this knowledge. He took an office in the city and started getting clients and he flies tax and returns. The activity which he does requires an individual to apply special knowledge and skills so as to sustain in the competition and keep making money. What kind of economic activity is discussed in the case?
(a) Business
(b) Employment
(c) Profession
(d) None of these

Correct Answer is Option (c)

Profession is that occupation in which one professes to have acquired specialized knowledge, which is used either in instructing, guiding or advising others.

Q.26: A book seller sells books of class 11th and class 12th. From the following information calculate the break-even point for him:

Fixed cost is ₹ 7,00,000.
(a) 2,940 units 
(b) 2,941 units 
(c) 2,950 units 
(d) 2,951 units

Correct Answer is Option (b)

Q.27: Ideas generated can be based upon?
(a) Secondary resources
(b) Natural resources
(c) Manufacturing resources
(d) None of these

Correct Answer is Option (b)
Ideas can be generated based on natural resources. A product or service may be desired from forest resources, agriculture, horticulture, mineral, animal husbandry, wind, sun and human resource.

Q.28: Match the following:

(a) 1 – (a), 2 – (d), 3 – (c), 4 – (b)
(b) 1 – (b), 2 – (d), 3 – (a), 4 – (c)
(c) 1 – (b), 2 – (d), 3 – (c), 4 – (a)
(d) 1 – (d), 2 – (c), 3 – (a), 4 – (b)

Correct Answer is Option (c)

Q.29: Which of the following is not true with respect to private company?
(a) It restricts the right of its members to transfer shares.
(b) The number of members is limited to 200.
(c) It uses the word Pvt. Ltd. after its name.
(d) It can invite public deposit. 

Correct Answer is Option (d)
A private company prohibits any invitation or acceptance of deposits from public.

Q.30: Assertion (A): If a company is sensitive to the internal environment, it will come out with new products and services to meet the requirements of the customers.
Reason (R): Proper understanding of the various elements of the external environment is necessary to take timely action to deal with threats and avail opportunities for the purpose of improvement in the performance of the firm
(a) Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).
(b) Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).
(c) Assertion (A) is true but reason (R) is false.
(d) Assertion (A) is false but reason (R) is true.

Correct Answer is Option (d)
If a company is sensitive to the external environment, it will come out with new products and services to meet the requirements of the customers. This would build the image or reputation of the firm in the eyes of the general public.

Q.31: After opportunity spotting and scanning of the environment, an entrepreneurial idea should lead to a _________________.
(a) Definite product
(b) Evaluate product
(c) Analyse a product
(d) None of these 

Correct Answer is Option (a)
An entrepreneurial idea leading to a definite product after opportunity spotting and scanning of the environment is called product identification.

Q.32: Vikram wants to expand his business from a small female wear shop to a family clothing store. While moving forwarded towards his thought, he realised that one of the first tasks demanded out of an entrepreneur is to manifest creative ability through the conceiving of new product-market opportunities and unique value propositions. Which step is termed as the first step in innovation process?
(a) Creativity
(b) Analytical planning
(c) Idea germination
(d) Verification 

Correct Answer is Option (a)
Creativity provides stimulus for opportunity discovery and new venture creation.

Q.33: Identify the first stage in the process of innovation which provides the stimulus for opportunity discovery and new venture creation.
(a) Creativity
(b) Idea
(c) Skills
(d) Opportunities

Correct Answer is Option (a)
Creativity is important to entrepreneurs because it is the first stage in the process of innovation, providing the stimulus for opportunity discovery and new venture creation. As new entrants, entrepreneurs often justify themselves upon the same dimensions as creativity: novelty, usefulness, and appropriateness. Arguably, one of the first tasks demanded of an entrepreneur is to manifest creative ability through the conceiving of new product-market opportunities and unique value propositions.

Q.34: Match the following:

(a) 1 (iv), 2 (i), 3 (iii), 4 (ii)
(b) 1 (iii), 2 (i), 3 (iv), 4 (ii)
(c) 1 (i), 2 (ii), 3 (iii), 4 (iv)
(d) 1 (ii), 2 (iv), 3 (iii), 4 (iv)

Correct Answer is Option (b)

Q.35: Sambhav thought of an idea to produce solar bins through which the garbage will get decompose automatically using solar energy. He went through the process of studying pros and cons of making such bin before launching it. Out of the following, identify the stage of creative process discussed above:
(a) Incubation
(b) Innovation
(c) Illumination
(d) None of these 

Correct Answer is Option (a)
Incubation is the subconscious assimilation of information. This is the transition period. The entrepreneur starts thinking about the idea and implementation in his/her subconscious mind.

Q.36: One of the important methods for generating ideas is to carry out a market research. Such a study yields valuable data about trends of supply, demand and consumer preferences. Which idea field is this?
(a) Natural resources
(b) Services related
(c) Market driven
(d) Creative efforts 

Correct Answer is Option (c)
One of the important methods for generating ideas is to carry out a market research. Such a study yields valuable data about trends of supply, demand and consumer preferences.

Q.37: Pranav, a manufacturer and seller of toys named "Fast Cars", while analysing the fall in the sales of his toy cars, found out that his products are failing to attract customers due to the lack of newness in design and features of the cars. So, he decided to employ a new designer Samay. He managed to create some great designs and the sales of Fast Cars sky-rocketed in an instance. Out of the following, identify the concept of entrepreneurship stated in the above case:
(a) Problem identification
(b) Sensing entrepreneurial opportunity
(c) Trend spotting
(d) None of these

Correct Answer is Option (a)
A problem is a roadblock in a situation, which forces an entrepreneur to identifies its solution and when he identifies it, it is called problem identification.

Q.38: Bhoomika started a pottery unit employing differently abled people to make and sell sculptures made of clay. She also made sure that the material she used is easily decomposable. During the months of September and October, she increased the scale of production as the festival of Diwali was round the corner. Identify the component of business environment at a macro level that is reflected in the above situation.
(a) Ecological
(b) Social
(c) Economic
(d) Political 

Correct Answer is Option (a)
Ecological environment considers the ways in which the organisation can produce its goods or services with minimum environmental damage.

Q.39: _______________ can be described as convenient frames of reference for streamlining the process of generation of ideas.
(a) Idea generation
(b) Idea fields
(c) Idea germination
(d) All of these

Correct Answer is Option (b)
The process of generation of ideas can be streamlined by developing an awareness for different ‘idea fields’.

Q.40: Vishwas an entrepreneur had a business idea of launching a new app-based food delivery system. In order to do so he decided to assess the market. He found that there was a demand for the food delivery services in his town. After a lot of study, he found that there was no competition in the market as well, as the big brands were working in the metro cities. He also decided to keep the price of delivery minimum and have tie-ups with the restaurant so that discounts could be given to the customers. As it was new thing in the market, his business flourished. Out of the following, identify the element of market assessment as identified in the above case:
(a) Demand
(b) Competition
(c) Project Innovation
(d) All of these 

Correct Answer is Option (d)

Q.41: Assertion (A): The operational is the soul of business plan.
Reason (R): The operations plan section describes the physical necessities of your business' operation.
(a) Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).
(b) Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).
(c) Assertion (A) is true but reason (R) is false.
(d) Assertion (A) is false but reason (R) is true. 

Correct Answer is Option (b)
An operational plan is a strategic document that describes all the day-to-day planning and processes needed to run a successful business.

Q.42: In a way all economic activities related to the production and distribution of goods and services undertaken for monetary gains, which economic activity is this?
(a) Employment
(b) Profession
(c) Business
(d) All of these 

Correct Answer is Option (c)
In a way all economic activities related to the production and distribution of goods and services undertaken for monetary gains, are said to be business.

Q.43: A product or service may be desired from forest resources, agriculture, horticulture, mineral, animal husbandry, wind, sun and human resource. Which idea field is this?
(a) Natural resources
(b) Services related
(c) Products or services
(d) Creative efforts

Correct Answer is Option (a)
Ideas can be generated based on natural resources. A product or service may be desired from forest resources, agriculture, horticulture, mineral, animal husbandry, wind, sun and human resource.

Q.44: Bunty a sports equipment seller. Below is the data for Bat and Ball. Calculate weighted average contribution.

Fixed cost is ₹1,20,000.
(a) 275
(b) 285
(c) 295
(d) 300

Correct Answer is Option (a)

Q.45: Honey and Badshah were running a partnership firm. They used to sell music CDs. Badshah wanted to bring his friend Neha also in as partner but Honey did not want to add a third partner. This eventually created a sense of distance between them and their coordination also was finished. Due to this reason they decided to liquidate the partnership. Which limitation of partnership is highlighted in the case?
(a) Limited resources
(b) Risk of additional liability
(c) Lack of harmony
(d) Limitation of capital 

Correct Answer is Option (c)
The old saying that “too many cooks spoil the broth” can be apt for a business partnership. Harmony may be difficult to achieve, especially when there are many partners. Lack of centralised authority and conflicts in policy can disrupt the organisation.

Q.46: Charan was running a garments store in Shillong. His business was not running well, he wanted to know the reason. When searched for the reason why his product is not selling. He got to know that his product was not up to the mark for the area and people. They did not like the product. In the above case which step of creative process is mentioned?
(a) Idea germination
(b) Preparation
(c) Incubation
(d) Verification

Correct Answer is Option (d)
Also called the validation or testing stage. This is where the idea is verified to prove that it has value. This is the most difficult phase of creativity as obstacles begin to appear. This is the developing stage in which knowledge is developed into application.

Q.47: Best Electronics Ltd., are the manufacturers of 'Air Conditioners' and 'Air Purifiers'. Their fixed costs are ₹32,00,000 per year. The sales price and variable cost per unit of 'Air conditioners' and 'Air purifiers' are given below:

During the year the company could sell 1000 Air conditioners and 1500 Air purifiers and could not break even. The Air conditioners and Air purifiers were sold in the proportion of 2:3 throughout the year. What will be the weighted average contribution?
(a) ₹3,200
(b) ₹2,000
(c) ₹1,200
(d) ₹6,400

Correct Answer is Option (a)

Q.48: Seema started a home-made papad business in Pune. Papad made by her became very popular in her locality but being the sole owner and manager of the business she could neither introduce many flavours because of limited financial resources nor could deliver it to more people. Which characteristic of sole proprietorship does apply here?
(A) Individual management and control
(b) Easy formulation and closure
(c) Limited area of operation
(d) Unlimited liability

Correct Answer is Option (c)
Sole proprietorship generally has limited area of operation due to limited finance availability and limited managerial abilities.

Q.49: __________________ Surya and his friend Chander are into developing sustainable products that are environment friendly and at the same time carrying value for the customers. They want to develop vegan leather by using Aloevera. They met the officials from Venture Angles company that promotes young entrepreneurs. Hopeful of a positive response they submitted a detailed, well written, and pleasingly formatted plan. Identify the format of business plan presentation used by Surya and his friend.
(a) Elevator pitch
(b) A pitch deck with oral narrative
(c) A written presentation for external stakeholders
(d) An internal operational plan 

Correct Answer is Option (c)
It is a detailed and well written business plan meant for external stakeholders.

Q.50: In a bid to send astronauts to Mars, US space agency Nasa has invited applications for four people to live in a simulated Martian exploration habitat in order to prepare them for the real-life challenges of future missions to the red planet. Nasa started taking applications for participants to live for a year in Mars Dune Alpha, a 1,700 square foot Martian habitat created by a 3D-printer that is inside a building at Johnson Space Center in Houston. Identify the macro environment factor which has influenced Nasa to develop Mars Dune Alpha.
(a) Political
(b) Social
(c) Legal
(d) Technological 

Correct Answer is Option (d)
Technological factor includes nature of technology, rate of technology transfer, new discoveries, research and development etc.

Q.51: Lakshmi Menon was troubled to see the huge waste generated by the scrap material left behind after stitching Personal Protective Equipment (PPE) gowns. These scrap materials could not be recycled easily. When she saw this problem, she thought of a solution also. It was to make lightweight bedrolls made from the scraps of the material. The bedrolls were cheap and durable and within a short span of time, demand for these bed rolls increased tremendously. What concept is involved in the above case study?
(a) Environment Scanning
(b) Problem Identification
(c) Trend spotting
(d) Market assessment 

Correct Answer is Option (b)
Problem identification is the activity of identifying an obstacle faced by people. An entrepreneur can solve the problem by introduction of new products in the market.

Q.52: Prabhu first established Tanvi Foods in Coimbatore, as a partnership firm in early 2016 with his wife Brindha Vijaykumar and started with mango and apple juices. The business did well in the first year with a turnover of ₹40 lakhs, and since then its revenue has been growing. While the main concentrate of the drinks is made at the company’s own 4,000 sq. ft. manufacturing unit in Coimbatore, the final product and bottling is done at third-party units (TPUs) in Coimbatore, Krishnagiri, Dharmapuri, Chennai, Puducherry, Mysuru, and Aurangabad. This has enabled them to scale up fast without needing much capital. What kind of manufacturing operation is followed in Tanvi Foods?
(a) No manufacturing involved
(b) Partial manufacturing
(c) Complete manufacturing
(d) Complete outsourcing 

Correct Answer is Option (b)
If some or all the manufacturing process is to be subcontracted or outsourced, then the production plan is described as partial manufacturing plan.

Q.53: Sankalp Singh Parihar cultivates the world’s most expensive Miyazaki variety of mangoes at his farm in Dhedagoua village in Madhya Pradesh. The Miyazaki variety of mangoes he grows at his farm sell at ₹2.5 lakh per kg in Japan. In India he got a price of ₹ 21,000 per kg, but he is yet to launch sales and is focusing on propagating the variety now. He intends to plant more saplings and make the mangoes affordable for Indians and sell it for as little as ₹2,000 per kg. He plans in such a manner that economic feasibility can be achieved in a few years. Which part of the business plan highlights economic feasibility?
(a) Organisational plan
(b) Financial plan
(c) Operational plan
(d) Marketing plan 

Correct Answer is Option (b)
Financial Plan highlights the economic feasibility by providing a clear view about:
(a) Amount of funds required
(b). Sources of funds
(c) Cash flow position, etc.

Q.54: Rajan, son of a humble soldier of the Indian army, did not have the resources to prepare for a medical entrance exam, but decided to launch a venture that would help others achieve their dreams. His startup, launched in July 2020 with zero investment, has clocked a turnover of ₹35 lakh in just 10 months and he has achieved it all as a one-man army. The start up prepares Group C employees of the Department of Post for the Limited Departmental Competitive Exams (LDCE) that qualifies them for their next promotion in the department. He realised that there was no training centre or coaching class for the aspirants so he marketed his classes for this specific group. Which step is involved in this marketing plan?
(a) Identify the target market
(b) Conduct SWOT analysis
(c) Establish goals
(d) Define marketing strategy 

Correct Answer is Option (a)
Target market is the specific group of customers whose needs the new venture aims to fulfil. The market is divided on the basis of geographic, demographic, psychographic divisions to select the target market for the venture.

Q.55: Madhu Chandan started the first Orgsanic Mandya store in 2015 on the Bengaluru – Mysuru highway. Today it has grown into a ₹25 crore turnover organic retail chain with eight stores. By buying the agricultural products from the farmers and selling them at ‘Organic Mandya’ stores, Madhu has not only provided a direct market to the farmers, but also has built a ₹25 crore turnover organic retail chain. Which idea field has Madhu Chandan taken up?
(a) Natural resources
(b) Service sector
(c) Trading related
(d) Existing products or services 

Correct Answer is Option (a)
Products can be derived from sun, wind, soil, water and other natural resources. In this case, organic farming is a product of natural resources.

Q.56: Sindhuja was extremely good at making traditional sweets which she had learnt from her grandmother. She decided to start selling the sweets through advertising in social media. Her business picked up and she got a lot of orders from clients all across India. Seeing her huge success, her friend Raman advised that she should open a shop in the market area to expand her business. He expressed interest in the business and was ready to invest money so that they could do the business together.
What form of business organisation does Raman and Sindhuja start?
(a) Sole proprietorship
(b) Partnership
(c) Private company
(d) Public company 

Correct Answer is Option (b)
Partnership is a form of business organisation wherein two or more persons mutually come together to do business and share agreed profits and losses.

Q.57: Monik Ltd. was the market leader in the Mobile Phone industry in 2000. The company was well known for it’s affordable phones. In 2007, a new company launched new Mobile models with latest technologies and captured the market. Monik Ltd. did not expect this and lost the entire market share and had to close their operations. Which of the following SWOT analysis framework does this case indicate that Monik Ltd. failed to do?
(a) Strengths
(b) Weakness
(c) Opportunities
(d) Threats 

Correct Answer is Option (d)
Threat is an unfavourable condition in the market which can lead to changes in current and future plans of the organisation.

Q.58: Hitesh, a fisherman, faced a lot of problems in selling the fish he caught. His entire community was facing this problem and most of the time they had to dump the fish they caught back into the sea. He read a newspaper article on how people have started ordering online for most of the essentials. He spoke to his fellow fishermen about selling their fish online and started their business with a small delivery truck and an app and slowly and steadily their business started to flourish. What trend has Hitesh spotted?
(a) Read trends
(b) Watch trends
(c) Talk trends
(d) Think trends 

Correct Answer is Option (a)
Read trend includes reading publications, websites, newspapers, etc. in order to obtain the necessary information.

Q.59: Suganya wanted the younger generation to understand the nutritional value of traditional food. Keeping this in mind, she started a ‘Eat To Fit’ - ETF restaurant and it was a successful venture. She opened many branches all over the state. Seeing her success, other restaurants followed the same model but ‘ETF’ always had the major market share.
Which point of importance of the environment does this case imply?
(a) Tapping useful resources
(b) Better performance
(c) Sensitisation of entrepreneurs to cope up with rapid changes
(d) Identification of opportunities to get first mover advantage

Correct Answer is Option (d)
Environmental scanning helps a business firm to analyse the internal environment of the company and identify the strengths that give a competitive advantage to the company.

Q.60: Fit Ltd. has become a well-known brand name in the field of fitness. Their products range from exercise equipment to protein powders. The company decided to launch a new product in the market which they believed will be a game changer. The company did a market survey amongst people from various age groups to know the acceptability of the product. What step of the creativity process is the company right now in?
(a) Idea germination
(b) Preparation
(c) Incubation
(d) Illumination

Correct Answer is Option (b)
Preparation is the stage where the person with an idea consequently thinks it and concentrates his energies on extension of idea to make it a reality.