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B.

Com IIIrd Year Paper-2 Objective Important Questions


1. Entrepreneurship is prosperity of mind to take : (a) early risk (b) Calculated risk (c) all types of risks (d) take no risks ANS. (b) 2. Two important characteristics of entrepreneurship is identified by Schumpeter and Maclelleard are: (a) Risk taking ability and decision making ability (b) Doing things and doing the right things (c) Doing things in a new and better way and decision making under uncertainity (d) Profit making and achievement oriented ANS. (a) 3. Entrepreneurship development counts of how many phases : (a) One phase (b) Two phases (c) Three phases (d) Four phases ANS. (b) 4. The starting of New venture starts from: (a) Resource generation stage (b) Project identification stage (c) Human Resources Mobilization stage (d) Training stage ANS. (d) 5. The full form on an institution for entrepreneurial development in Delhi NIESBUD is: 6. Innovation in Entrepreneurial qualities refer to: (a) Invention (b) Continuous improvement (c) Improvement (d) Discovering new ANS. (b) 7. In cash flow statements, cash flows are taken from: (a) Operating Activities (b) Investing Activities (c) Financing Activities (d) All of the above ANS. (d) 8. Interest coverage ratio is represented as: (a) EdBIT/INTEREST : EDBIT (b) EBDIT + Lease Rental/Interest + Lease Rental : EDBIT (c) EDIT/INTEREST : EDIT (d) Total Assets/INTEREST ANS. (a) 9. The Discounting Factor used in calculating the present value in capital budgeting decisions: (a) Is the cost of capital (b) Post tax interest rate (c) Pre-tax Interest rate (d) Current rate of interest ANS. (c) 10. Venture capital is: (a) Loan given to New Enterprise (b) Capital funded by VCF not normally given by Banks. (c) Loan given by DFI. (d) A special loan given to new bread entrepreneurs ANS. (a)

Objective Important Questions


Indicate whether the following statements are TRUE or FALSE 1. Max Weber founded the theory of need of achievement in the field of entrepreneurship development theory. (F) 2. ICICI venture fund management was established by Reserved Bank of India. (F) 3. Cash from operation and funds from operation both are same. (F) 4. Net present value method is not most scientific and logical. (F) 5. ISO 9000 represents trade mark (F) Select the correct answer 6. Leader is : (a) Bossim (b) Fear (c) High Post (d) None of these 7. Which of the following is not included in SWOT analysis : (a) Opportunity (b) Management (c) Strength (d) Thread 8. If profit is 50% of sales, then the percent of cost will be : (a) 50% (b) 75% (c) 100% (d) None of these 9. Capital expenditure is : (a) Wages paid (b) Machine purchased (c) Salaries paid (d) Rent Paid 10. Extrepreneurial Development Institute of India is situated in: (a) Ahmedabad (b) Mumbai (c) New Delhi (d) Chennai

ANS. (a)

ANS. (b)

ANS. (c)

ANS. (b)

ANS. (a)

Objective Important Questions


Indicate whether the following statement are TRUE or FALSE: 1. 2. 3. 4. Entrepreneur is a risk-taking man. (T) Decision-making and decision both are same. (F) Financial analysis helps in determining the size of venture. (T) Business is a game of skill which everybody cannot play. This statement is of R.S. Dabur. (T) 5. Purchase of materials + Closing stock of material Opening stock of material + Carriage inward = Value of material consumed. (T)

6. Cash from operation and Fund from operating both are same. 7. Money spent on preparation of a project is an investment. 8. Calculated method of payback period is too diff. 9. There is necessity to entrepreneurial development programme in India. 10. Entrepreneur is an inventor and not an innovator.

(T) (F) (T) (F)

Objective Important Questions


Indicate whether the following statement are TRUE or FALSE: 1. Risk and Uncertainity both are same. (T) 2. Entrepreneurs start business to gain independence, financial reward, job satisfaction and a sense of control. (T) 3. Opportunity analysis is done for idea generation in business. (T) 4. Business is carried out only for earning profits. (T) 5. Monetary costs are equal to out of pocket costs. (T) 6. The margin of safety refers to sales in excess of the break even volume. (T) 7. Finance and cash are same. (F) 8. Government has no role in entrepreneurship development. (F) 9. In Pay back period method cash inflows after depreciation and tax are used. (F) 10. An entrepreneur is someone who takes initiative for the innovation. (T)

Objective Important Questions


Indicate whether the following statement are TRUE or FALSE: 1. 2. 3. 4. Entrepreneur is a risk taking man. (T) Success of leadership depends on efficient decision making. Financial analysis helps in determining the size of venture. (T) Business is a game of skill which everybody cannot play. This statement is of Imerson. (T) 5. Profit at selling price = Cost x % of profit 100 - % of profit 6. Cash from operation and funds from operation both are diff. (T) 7. Solution of serious problem like unemployment lies in the development of small industries (T). 8. Money spent on preparation of a project is an investment. (T) 9. Social responsibility is a two-way traffic. (T) 10. Entrepreneur helps in import substitution. (T)

SELECT THE CORRECT ANSWERS: 1. Entrepreneur is: (a) Enterprising 2. Planning is: (a) Short term (a) Technical (a) 1970 5. Margin of safety: (a) Break even point (d) Total sales STATE TRUE OR FALSE: 1. Decrease in stock is a source of cash. TRUE 2. Capital budget is related with capital expenditure TRUE 3. Net present value method is not scientific. FALSE 4. Entrepreneurial development institute of India is situated in Ahmedabad. 5. Government has no role in entrepreneurship development. FALSE TRUE (b) Total cost (c) Total sales-B.E.P sales (b) mid-term (b) Competitive (b)1975 (c) Long term (c) Social (c) 1986 (d) All of these (d) Production (d) 1988 3. Which of the following is not the factor of external environmental analysis? 4. Venture capital trust was established in : (b) Manager (c) Risk taker (d) All of these

Short Important Questions


1. Write the four characteristics of Entrepreneur. OR What are objectives of business planning? 2. How opportunities analysis is done? Explain OR Write four factors governing venture capital. 3. Write four uses of break even analysis. OR Why projected balance sheet is prepared? Explain 4. What are the techniques of investment appraisal? OR Write demerits of Pay back Period Method.

5. What are the objectives of Entrepreneurship development programme? OR What are the achievements of Entrepreneurial Development Programme?

Long Important Questions


1. Discuss the role of socio-economic environment in the context of entrepreneurship. 2. How do the technological and competitive factors affect the external environment of business? Explain. 3. Write a note on the role of government in the development of entrepreneurship.

Numerical Questions
1. Estimate the amount of profit under each of the following condition: (A) p/v ratio is 20% and margin of safety is RS. 40,000 (B) p/v ratio is 20%, fixed cost Rs.1,25,000 and salaries is Rs.8,00,000 (C) p/v ratio is 20%, M.O.S. 30% and sales is RS. 10,00,000 (D) Variable cost 70% of sales, fixed cost RS. 30,000 and sales RS. 2,00,000 2. Rajan & co. is considering the purchase of a machine .To machines X and Y are available each costing RS. 2,00,000. Earning after tax but before depreciation are expected to be as under: YEAR MACHINE X MACHINE Y 1. 60,000 20,000 2. 80,000 60,000 3. 1,00,000 80,000 4. 60,000 1,20,000 5. 40,000 80,000 Evaluate the two alternatives according to return on investment , average rate of investment and NPV @10%