CBSE Class 12 Entrepreneurship Sample Paper Term 1

Section A

Question 1. Seema started her own small business of cake making using her free time at home with the help of few of her own friends. They named their business For Heaven's Cakes Initially they were supplying cakes only to their district on order The demand for their cakes was growing continuously and they planned to expand and start selling in other states. Seema discussed the same with her brother He suggested that they have to properly look into the environment analysing the competition He suggested Sudha to

a) Formulate policies                         b) Tap useful resources

c) Enivironment scanning                  d) Image building

Question 2.  Ishita was manufacturing lunch-boxes for school going children. To increase sales and ultimately the revenue she decided to improve the quality of lunch boxes and added a warmer in the lunch-boxes so that children could eat warm food in winter She also gathered information about target markets and customers for the same Identify the Idea fields discussed in the above paragraph.

a) Natural resources                            b) Existing products or services

c) Service sector related field               d) None of the above

Question 3. Naveen belongs to a farmer family. One day he was viewing 'Krishi Darshan' programme of 'Doordarshan' on his television. The heading of the programme was on How to grow honey-bees and produce honey'? In the same programme the methods of marketing honey through marketing cooperative societies were also being discussed) Naveen decided to grow honey-bees and market the honey produced) Identify the idea field which helped Naveen in generating the idea of growing honeybees and marketing the honey.

a)Natural resources                            b) Existing products or services

c) Service sector related field             d) None of the above

Question 4. Sonam, a dropout from 10th class is forced by her mother to start working as a domestic help. Sonam agrees on the condition to do only if every day she is allowed to cook at home and in 2-3 houses as she was fond of cooking. One family turns out to be Punjabi, other Gujarati and the third one is Rajasthani. She cooked their kind of food for a year and to everyone's surprise, she expressed her desire to open up a small eating joint of her own.All alone, determined, she finally opens "Apna Bhoj", a small eating joint with her savings and it became a hot spot because of the fusion food platter being offered Sonam is.

a) Entrepreneur                                   b) Manager

c) Employee                                         d) Trader

Question 5.  Amish has the habit of reading newspaper on a daily basis. The latest headlines caught his attention. The headlines read as follows, "Government plans to offer subsidy to manufacturers of solar panels" He had also heard from his friend that individual house owners are preferring to install solar panels to save electricity He started to make connections that led him to a business idea of establishing a small scale industry manufacturing solar panels.Which of the following ways of identification used by Amish which has helped him to understand the market and produce goods accordingly

a) Read Trends                                                    b) Watch Trends

c) Think Trends                                                  d) Talk trends

Question 6.  Dristi Ltd decided to manufacture mobile phones with a new feature. It will have an inbuilt button which when pressed will extend into a selfie stick enabling the customers to click selfie easily without the need to carry a separate selfie stick. Identify two PESTEL factors which enabled Dristi Ltd), to bring out this new feature.

a) Technological and Social                            b) Social and Economic

c) Technological and Economic                      d) Economic and Legal

Question 7. Bunty, a fitness freak NRI, had done his masters in nutritional sciences from U.K, during his vacations, he was disappointed to see that no Gymnasium in Delhi had a workout module to suit his requirement. Anyhow, Fitness Fine Gymnasium of his friend offered him freedom to exercise the way be wanted) In short time, Bunty became popular amongst the other members because of his knowledge, experience, competency, tactics and tips on exercising. He now explored deeply his curiosity of starting a Gymnasium in Greater Kailash 2, having a fusion of both diet and exercise under one roof. He conducted a market research and subconsciously assimilated a whole data bank of information to lifestyle, interests, etc) of people in and around the area) He approached his father for financial help of 25 lakhs as he had 20 lakhs only. The ground floor of his flat was to be converted into a Gymnasium. He started networking and negotiating with the manufacturers who could provide him with customized machines of his choice. "One of the first task demanded of an entrepreneur is to manifest creative ability through the conceiving of new product-market propositions". Which process has been initiated by Bunty.

a) Sensing entrepreneurial opportunity                         b) Creativity

c) Environment Scanning                                            d) None of the above

Question 8. Karan Chopra, a successful entrepreneur, in a workshop said, "One of the keys to business success is to anticipate what the market will want or need) Since it is not possible for an entrepreneur to see into the future, there is one best way. The best way will help the entrepreneur to understand the market and produce goods or services accordingly." The concept stated in the here is _________

a) Environment Scanning                                  b) Trend Spotting

c) Entrepreneurial Sensing                                d) None of the above

Question 9. Exploring opportunities in the environment is a process involving various steps. Arrange the steps in correct order

(i) Evaluate the ideas received from different sources to find a creative solution

(ii) Identifying a product or service through innovation.

(iii) Opportunity spotting by analysing the needs and problems that exist in the environment

(iv) Setting up a project and nurturing it to success

a) i-ii-iii-iv                                                             b) iii-i-ii-iv

c) ii-iii-iv-I                                                            d) i-iv-iii-ii

Question 10. ____________analysis is a review of current performance and achievement of the enterprise.

a) Business situation                                        b) Employee performance appraisal

c) Work load analysis                                      d) None of the above

Question 11.  Both direct and indirect are the sales strategies but the way of approaching customer makes them different from each other. Which of the given statements below justifies the given statement?

a) In indirect sales approach. Sales person demonstrates features and benefits not available with the competition's products whereas in direct sales approach, sales people attack the competition head

b) Indirect sales approach is positive selling whereas direct selling is negative approach

c) Both a) and b)

d) Neither a) nor b)

Question 12. What is common among Woodland, Asian Paints, Parle, and Nike?

a) All are the examples of Brand name                         b) b) All are individual brand name.

c) All use skimming pricing                                           d) All of the above

Question 13. This branding policy requires that all the products use the organization's name, either entirely or in part, e.g. Microsoft, Heinz, and Kellogg's.

a) Corporate branding                                                      b) Family branding

c) Individual branding                                                     d) None of the above.

Question 14. Which of the following media is suitable for image building, information dissemination and sales campaigns?

a) Radio                                                               b) Television

c) Direct mail                                                     d) Cinema

Question 15. Marketing Mix is the most visible part of the marketing strategy of an organization. Is the given statement 'True' or 'False'?

a) True                                                                 b) False

c) Can’t say                                                         d) Partly True

Question 16.  Shilpi Ltd) started the manufacturing of herbal toothpaste. They researched that large number of established enterprises were also manufacturing the similar type of products. The company fixed the price of their toothpaste on 'cost plus method' of pricing. After sometime the company realized that they were not getting good response regarding their toothpaste from the customers and the market share of their toothpaste was less than 0.5%. Since their product was new, they decided to change the pricing method so that initially they could get more customers. Identify the new pricing method that was adopted by Shilpi Ltd)

a) Penetration Pricing                                        b) Price skimming

c) Cost plus pricing                                            d) Competitive pricing

Question 17.  Blessy Ltd) decided to diversify into manufacturing vitamin enriched water apart from their original business of cold drinks. The finance and marketing department sat and decided to adopt either of these two pricing techniques - adding a certain percentage of profit to the cost of production or to sell at a lesser amount so as to capture huge market. They put forth their finding to the CEO. The techniques are: 

a) Cost plus pricing and penetration pricing               b) Cost plus pricing and skimming pricing

c) Penetration pricing and skimming pricing             d) Competitive pricing and penetration pricing

Question 18.  Which of the following refers to investment in all current assets?

a) Gross working capital                                                 b) Net Working Capital

c) Current investments                                                    d) None of the above

Question 19.  Cash conversion cycle represents the number of days a firm's cash remains tied up within the operations of the business. Is the given statement 'True' or 'False'?

a) True                                                                 b) False

c) Can’t say                                                         d) Partly True

Question 20.  A manufacturer produces 1500 units of products annually. The marginal cost of each product is 960 and the product is sold for 1200. Fixed cost incurred by the company is 48, 000 annually. What would be the break - even point in terms of output?

a) 200units                                                         b) 400units

c) 500 units                                                        d) 250units

Question 21.  As per the following information, what will be the Sales to earn profit of ₹2,40,000

Particulars                                                 ₹

Sales                                                    8,00,000

Fixed cost                                             3,60,000

Variable cost                                        5,60,000

a) ₹ 2,40,000                                                      b) ₹2,00,000

c) ₹24,00,000                                                     d) ₹ 20,00,000

Question 22. "One-man control is best in the world if that man is big enough to manage everything." This statement holds true for ____________ form of business organization.

a) Private company                                             b) Sole proprietor

c) Partnership                                                       d) Public company

Question 23.  Partnership form of organisation was developed due to the inherent limitations of sole proprietorship. One of them is limited capital, identify the other two?

a) Limited managerial ability, limited continuity        b) Limited continuity, unlimited liability

c) Limited managerial ability, unlimited liability        d) Lack of secrecy, limited continuity

Question 24.  _______________ section of the business plan generally begins with the "mission statement" by the entrepreneur describing the size, scope and nature of the enterprise.

a) Description of business Venture                 b) Introductory profile

c) Industry profile                                        d) Entrepreneur’s biodata 

 Section B

Question 25.  Two years ago Gopal started manufacturing low fat, sugar-free ice cream on a small scale basis in his home town, Vishakhapatnam. After some time his ice cream became popular among health conscious young customers and old persons specially those having diabetes or some heart ailment. Because of the popularity of the ice cream the demand has increased many fold) Gopal is unable to meet same, because of his limited managerial ability and limited capital. Gopal also felt that whenever he fell sick his business was temporarily closed) To overcome this problem he decided to admit in the business his friend Mohan who has recently completed his MBA and is ready to invest money for the expansion of the business. Mohan advised Gopal to get their firm registered Which form of business organization has been opted by Gopal after identifying limitations in previous one? 

a) Sole proprietorship                                                        b) Partnership 

c) Joint Stock Company                                                     d) Cooperative 

Question 26.  Abhiraj Chaudhary is into the business of manufacturing low cost diesel cars in Germany. He is earning good profits and ambitiously considering overseas expansion. He scans the environment for finding out the opportunities and threats that may influence his current and future plans. He zeros down on India as a potential place for his business expansion as Indian Government has announced favourable trade regulations. On selling the first lot of cars in India, the Indian Government noticed that the emissions from these cars were above the permissible limit. The government asked him to make necessary modifications in his cars if he wanted to continue business in India) He readily agreed to meet the emission norms set by the Indian Government.From the above para identify any three environmental factors.  

a) Political, Ecological and Legal                                    b) Economic, Ecological and Legal 

c) Ecological, Political and Social                                   d) Technological, Political and Social 

Question 27. Suman joined a catering college after finishing her schooling. She specialised in baking cakes After finishing her course, she along with her two friends started a bakery shop in Lucknow. Her shop was an instant success as the cakes were produced with high quality ingredients. In the month of November, Suman's sister's birthday approached and her mother requested her to bake a cake for the birthday Suman baked a cake for her sister at their home for her sister's birthday. Identify the nature of activity performed by Suman for her sister and at her shop.

a) Economic activity                                          b) Non-economic activity

c) Employment                                                  d) Profession

Question 28. Saurabh wants to start a new business. He is not sure of the type of business he should start. His friend suggested him to seek the help of professionals. He contacted a professional who asked Saurabh to pay a big amount for providing the reports and industry updates. Therefore, he decided to search for the reports and industry updates himself. He scanned the relevant information from various national and international websites. Identify the way that Saurabh is using for spotting the trend)

a) Talk Trend                                                      b) Watch Trend

c) Read Trend                                                     d) Think Trend

Question 29. Vishnu started his factory for manufacturing plastic items in Daman. As per the advice of his Manager, he appointed 'Bizmadeeasy' company to formulate a business plan for his manufacturing unit. The company in its business plan, mentioned the cost of installing a water waste treatment plant within the premises of the manufacturing unit. Which of the following is the socio-economic benefit expected to acquire from the proposed investment. 

a) Employment generation                              b) Import substitution

c) Ancillarisation                                            d) All of the above

Question 30. Paranshu was working with Hitesh, a new entrepreneur, as a Production Manager. To achieve the objectives, he issues necessary orders and guidelines to his subordinates pertaining to work and they give practical shape to the production plan. Identify the element being discussed above which is related to one of the components of a 'Business Plan'

a) Dispatching                                                     b) Inspection

c) Scheduling                                                        d) Routing

Question 31.  Nayan has just passed his Senior Secondary Examination from CBSE affiliated school. He wanted to start his own business but was undecided about the nature of the business to be started) One day, during the morning walk, his grandfather fell down in the park and was injured He observed that his grandfather often forgot to take his medicines. He thought that the same problem may be faced by other old people. He thought to develop a walking stick for old people that could be fitted with some electric devices connected to the mobile phones of the members of their families which could indicate the location of the old people when they go outside their homes. He also thought to fit a timer in the stick that could remind them about the time of taking their medicines. Identify the concept described in the above para that helped Nayan in structuring his idea of solving the problem.

a) Problem identification                             b) Environment scanning

c) Sensing Entrepreneurial Opportunities     d) Trend Spotting

Question 32. 'Safe Wheelers' is an upcoming cab service. The promoters knew that they are entering a highly competitive market. They gathered information on existing cab services and changing customer preferences and incorporated those observations into their operations. In order to reach the customers promptly, they developed an 'app' to book, track and trace the cabs 24x7 To create an environment of trust all drivers were grouped into two shifts: 6 a)m. - 6 p.m. for female drivers and 6 p.m. - 6 a)m. for male drivers. GPS systems were installed in all cabs to monitor their movements. The fare payment was either by an e-wallet or through the 'Safe Wheelers' Smart Card) As soon as the services were launched, they were a grand success. 

Identify the concept that helped the company to succeed) 

a) Problem identification                                  b) Environment scanning 

c) Sensing Entrepreneurial Opportunities     d) Trend Spotting 

Question 33.  Kapish an unemployed graduate got training for automobile repairing and allied services under PMKVY (Pradhan Mantri Kaushal Vixas Yojana) for skill development. He is planning to stam a digital workshop for which he needs ? 25 Lakh. Though through MUDRA (Mico Units Development and Refinance Agency) he is able to get a loan of 10 Lakh but still he is falling short of 2 15 Lk. He wants to pitch in his adea to potential investors through his business plan. He prepared an show and oral narrative to trigger discussion and create interest in potential investors for reading the written presentation. Out of the following, identify the format of business plan used by Kapish: 

a) Elevators pitch                                               b)Pitch deck with oral narrative 

c)Operational plan                                              d) None of these 

Question 34.  Prabhay is a budding entrepreneur who is about to pitch in his idea to a group of imeston. For presenting his business plan he has made a teayer of about three minutes to awaken the interest of the potential investors Prabhav is using format of presenting a business plan 

a) Elevators pitch                                               b)Pitch deck with oral narrative 

c) Operational plan                                              d) None of these

Question 35. "Big brands make head towards franchising”  Which of the following can be the reason for the above stated statement? 

a) It considers franchising as an easy mode of expansion. 

b) Chances of success are higher due to high commitment level of the franchisor and the franchisees 

c) it is a powerful and ideal way to expand business 

d) All of the above 

Question 36. Which of the following is not a quality of a good brand? 

a) It should be long                                                             b) Neither obscene, negative, offensive or vulgar 

c) Pleasing, impressive when uttered)                           d) Linked to product, symbolically eye catching.  

Question 37. What is common among Teco bell, Burger King, Hertz, Khadim's?

a) All MNC working in India                                             b) All have adopted franchising as their growth strategy. 

c) All have merged with big companies.                        d) All of the above. 

Question 38.  Which of the following is the direct result of financial factors such as lower taxes, higher debt capacity or better use of idle cash for which two or more firms merge together. 

a) Financial synergy                                                           b) Revenue synergy 

c) Legal environment                                                         d) Political environment 

Question 39.  Rohan after completing his MBA from IIM Kolkata has joined a multinational company in the capacity of Marketing Manager. The company deals in diversified range of products. It deals with electronic items (like LED bulbs, blenders etc)) engineering goods, along with heavy machinery to be used in chemical industries. He has to decide the channels of distribution best suited for the company's product. Therefore, Rohan decided to use wholesalers and retailers for electronic goods and engineering goods and direct selling for heavy machinery.  The element of marketing mix discussed above is: 

a)place   mix                                                                        b) product mix 

c) promotion mix                                                                d) price mix 

Question 40.  B & H is a leading advertising firm. They recruit new graduates through college placements. During an interview, a student was asked to list the four rules for planning any advertising activity, He replied that the following is required: Aim, Target, Desire, Competitors. Mention whether stated rules of advertising are 'True' or 'False 

a)True                                                                                    b) False 

c) Cant say                                                                            d) Partly false 

Question 41.  A company produces calculators and sells 1,000 units of the same at ? 100 each. The variable cost of production is 760 per unit and fixed cost in 7400 per annum. The break-even point will be 

a)₹1050                                                                 b) ₹2500 

c) ₹2000                                                                 d) ₹1000 

Question 42.  Software Ltd) is a trading concern. It has capital of 75,00,000 What will be return on investment for 

(i) Sales:                ₹2,50,000 

(ii) Gross Profit   ₹1,00,000 

(iii) Expenses      ₹750,000 

a)50%                                                                                    b) 20% 

c) 10%                                                                                   d) 30% 

Question 43. A Bites Ltd is a manufacturing firm It has capital of 75,00,000 of which 3,00,000 is debt fund Following are the other information. 

(i) Sales:                ₹2,50,000 

(ii) Gross Profit    ₹1,00,000 

(iii) Expenses      ₹750,000 

Return on equity for the firm will be: 

a)50%                                             b) 25% 

c) 100%                                          d) 30%  

Question 44.  A Company is called an artificial person because ____. 

a) it does not have the shape of a natural person.        b) it cannot be sued in the court of law. 

c) it is invisible and intangible.                                       d) it exists in the eyes of law  

Question 45.  Which of the following factors does the macro-environment not include? 

a) Political and regulatory factors.                  b) Customer needs in a given market. 

c) Social and demographic factors.                 d) Technological changes 

Question 46.  Which of the following formats of business plan is not targeted towards the external stakeholder? 

a) Elevator pitch                                                    b) A pitch deck with oral narrative 

c) A written presentation for external stakeholders  d) An internal operational plan 

Question 47. An idea should eventually lead to success of the venture of an entrepreneur. Which among the following ideas will an entrepreneur have to select? 

a) Basic idea                                                                         b) Any random idea 

c) Idea developed before environmental scanning                   d) Idea developed after environmental scanning 

Question 48. ______ component of a financial plan helps to ascertain the highest possible returns on investment. 

a) Proforma investment decision                                    b) Proforma income statement 

c) Proforma cash flow                                                       d) Proforma balance sheet 

Section C

Question 49.  During the Pandemic, the worst hit were the families who were infected by the virus and had no source for home cooked nutritious food) ‘Chilly Chillz’ is a multi-cuisine chain of restaurants operating throughout Delhi by a well-established network of outlets. The owner of the chain understood the concern and started serving 3 course meal to such families on payment basis. The interested customers had to login the website, select their location and set their menu for the day. This service proved to be a great support for suffering families. What was the source of generation of basic idea?

a) Innovation                                                                        b) Invention

c) Problem                                                                            d) Competition

Question 50.  Amaze ltd), is a company engaged in the manufacturing of air- conditioners. The company has four main departments Purchase, Marketing & Sales, Finance and Warehousing. As the demand for the product grew, the company decided to recruit more employees in the Finance department and Marketing & Sales departments. Identify the component of the business plan which will help the Human Resource Manager to decide and recruit the required number of persons for each department.

a) Marketing Plan                                                                b) Financial Plan

c) Manpower Plan                                                               d) Organisational Plan

Question 51. An economic idea which can be implemented to create a business enterprise and earn profits must possessed with

A. Practicability of the idea

B. Competence of the entrepreneur to encash it

C. Potential of future growth

a) Only A                                                               b) A and B only

c) A & B and C                                                       d) B & C only

Question 52. Can all ideas be converted into opportunities?

a) Yes, as ideas lead to opportunity                

b) Yes, only if it has assured market scope

c) Yes, only if there is a good market for the product and rate of return on the investment is attractive.

d) Yes, if the entrepreneur has enough financial resources

Question 53. The scope of the company form of organisation is determined by

1. The Companies Act 2013

2. Memorandum of Association

3. Articles of Association

a) Only 1                                                                b) Both 1,2

c) Only 2                                                                d) All 1,2,3

Question 54. Which of the following examples is not a part of the social environmental factor?

a) At the time of Holi, a large number of manufacturing firms get involved in making colours which are used in the celebration of this colourful festival.

b) A particular channel refrains from showing the advertisement of a particular product as it is banned by the government.

c) The sale of sarees increases in the months of the year when a large number of marriages take place in India) The saree manufacturing companies make special plans of sale for these months.

d) a & c only

Question 55. Arvind started his manufacturing unit in Jammu and Kashmir. scarf, both woollen and silk. His business was not picking up in the markets as desired) He found out the reason his scarves were not selling was due to their colour. What could be the best source of this information?

a) Manufacturers.                                                b) Retailer.

c) Competitors.                                                    d) Government bureau

Assertion-Reasoning MCQs

Direction (Q Nos 56-60) There are two statements marked as Assertion (A) and Reason (R). Read the statements and choose the appropriate option from the options given below

a) Both Assertion (A) and Reason (Riare 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) Aassertion (A) is false but Reason (R) iis true

Question 56. Assertion (A) : Needs and problems exists in the environment

Reason (R) : Opportunity is spotted by analysing the environment.

Question 57. Assertion (A): A company which is suffering huge losses can be shut down only by following the procedures laid down in Companies Act.

Reason (R): A company can be born as well as liquidated only by law

Question 58. Assertion (A): Usefulness of break even analysis continues to be the same whether the business is operating a single product or multiple product

Reason (R): Break even analysis helps in setting profit goal and sales target

Question 59. Assertion (A): Cash is the most important asset for the operations of business

Reason (R): Cash flow refers to the movement of money in and out of a business during a specific period of time.

Question 60. Assertion (A): Financial planning is one of the key elements to the process of financial management.

Reason (R): Management need to ensure that enough funding is available at the right time to meet the needs of the business.