NCERT Class 12 Business Studies Entrepreneurship Development

ENTREPRENEURSHIP DEVELOPMENT 

INTRODUCTION

Entrepreneurship is the process of setting up one’s own business as distinct from pursuing any other economic activity, be it employment or practising some profession. The person who set-up his business is called an entrepreneur. The output of the process, that is, the business uit is called an enterprise. You may invoke‘subjectverb- object (SVO)’ relationship in English grammar to clearly understand these terms. (See Figure on SVO Analogy) 

It is interesting to note that entrepreneurship besides providing self-employment to the entrepreneur is responsible to a great extent for creation and expansion of opportunities for the other two economic activities, that is, employment and profession. (Can you think why and how?) Further, each business gives rise to other businesses– the suppliers of raw materials and components, service providers (be it transport, courier, telecom, distributor middlemen and advertising firms, accounting firms and advocates etc. And, in the process, entrepreneurship becomes crucial for overall economic development of a nation. Given its important role in the overall scheme of economic development, it is interesting to note that not many persons opt for a career in entrepreneurship.

Traditionally, it wasbelieved that entrepreneurs are born. No society can wait for the chanceof ‘birth’ of entrepreneurs to pursue its developmental plans. In fact, plans for economic development would bearlittle fruit unless entrepreneurship development is regarded as a deliberate process of making people aware of entrepreneurship as a career at an early age and creating situations where they may actually make a choice to become entrepreneurs. When you make this choice, you become a job-provider rather than a job-seeker, besides enjoying a host ofother financial and psychological rewards. Taking to entrepreneurship is surely more a matter of aspiring to become an entrepre

THE CONCEPT OF ENTREPRENEURSHIP

You are aware that entrepreneurship is regarded as one of the four major factors of production, the other three  being land, labour and capital However, it should surprise you that as regards its French origin, the term ‘entrepreneurship’ (derived from the verb ‘entreprende’ meaning ‘to undertake’) pertained not to economics but to undertaking of military expeditions. So is true of many terms in management such as strategy (a course of action to beat the competition, the ‘enemy’) and logistics (movement of men and machines for timely availability), etc. Historically, as wars are followed by economic reconstruction,  it should be no surprise thatmilitary concepts are used in economics and management. 

EXERCISES

Multiple choice questions

Put a tick against the most appropriate answer to the following questions.

1. Entrepreneurs undertake

    a. Calculated risks

    b. High risks

    c. Low risks

    d. Moderate and calculated risks

2. In economics, which of the following is not a function of the entrepreneur?

    a. Risk-taking 

    b. Provision of capital and organisation of production

    c. Innovation

    d. ay to day conduct of business

3. Which of the following statements does not clearly distinguish between entrepreneurship and management?

    a. Entrepreneurs found the business; managers operate it

    b. Entrepreneurs are the owners of their businesses; managers are employees

    c. Entrepreneurs earn profits; managers earn salaries

     d. Entrepreneurship is once for all activity; management is a continuous activity

4. In the roles and functions of the entrepreneur identified by Kilby, which of the following is not an aspect of ‘political administration’?

    a. Dealing with public bureaucracy 

    b. Managing human relations within the firm

    c. Introducing new production techniques and products

    d. Managing customer and supplier relations

5. Which of the following attitudes is not generally associated with successful entrepreneurship

    a. Investing in R and D

    b. Live your business day by day

    c. Innovate and improvise continually

    d. Produce as per customers’ requirements

Short answer questions

1. Clarify the meaning of the terms ‘entrepreneur,’ ‘entrepreneurship,’ and ‘enterprise.’

2. Why is entrepreneurship regarded as a creative activity?

3. “Entrepreneurs undertake ‘moderate’ risks.” Elaborate this statement.

4. How does entrepreneurship result in increasing the spectrum and scope of economic activities? 

5. Describe briefly the role of achievement motivation in entrepreneurship.

Long answer questions

1. Describe briefly the steps involved in starting a new business.

2. Examine the nature of relationship between entrepreneurship and economic development.

3. Clarify how motivation and abilities impact an individual’s decision to choose entrepreneurship as a career.

Please refer to attached file for NCERT Class 12 Business Studies Entrepreneurship Development