KALASALINGAM

ACADEMY OF RESEARCH AND EDUCATION

(Deemed to be University)
Anand Nagar, Krishnankoil – 626 126.
OFFICE OF THE CONTROLLER OF EXAMINATIONS
MBA18R5221 - Entrepreneurship Development
Question Bank + Key Report

Mapping
Questions in Unit-1 Pattern Marks
COs
Topic: AFFECTING ENTREPRENEURSHIP
79972 What are the non-economic factors? Analyze CO1 2

Key:
(a) Legitimacy of Entrepreneurship
(b) Social Mobility
(c) Marginality
(d) Security
Topic: BARRIERS OF ENTREPRENEURSHIP
1 Write any five barriers of Entrepreneurship.
80029 Analyze CO1 2

Key:
(a) Lack of viable concept
(b) Lack of market knowledge
(c) Lack of technical skill
(d) Lack of initial capital
(e) Lack of business know how
77947 What are the Barriers of entrepreneurship? Analyze CO1 8

Key:
Corrupt and un supportive business environment
Employee related difficulties Severe market entry
regulations Shortage of funds and resources Lack of
Entrepreneurship Opportunities Lack of
Entrepreneurial Capacity Lack of Adequate
Entrepreneurship Training Lack of Appropriate
Technical and Practical Skills Lack of Market
Experience Fear of Failure Aversion to Risk
Topic: BECOMING AN ENTREPRENEUR.
80007 List out the factors to be considered before becoming an entrepreneur. Evaluate CO1 2

Key:
Business Idea
· Skills (Technical/Managerial)
· Market
· Capital (Opening. Working or Long Term)
· Machinery (Technology)
· Raw Materials
· Location (Strategic)
· Legal Issues
· Competition

Topic: CASE STUDY

77651 ‘Safe Wheelers’ is an upcoming cab service. The promoters knew that Analyze CO2 16
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 cab
24*7. To create an environment of trust all drivers were divided into
two shifts, 6am –6pm for female drivers and 6pm-6am for male
drivers. GPS systems were installed in order 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 and explain the concept that helped the company to succeed
 Key:
Environment Scanning
Careful monitoring of an organization's internal and external
environment for detecting early signs of opportunities and threats that
may influence its current and future plans.
Topic: DEVELOPING ECONOMIC SOCIETY
79990 What are the role entrepreneurship in developing economic society? Analyze CO1 2

Key:
Rural Entrepreneurship
· Tourism Entrepreneurship
· Agricultural Entrepreneurship
· Social Entrepreneurship

Topic: ENTREPRENEUR
79936 Define Entrepreneur. Remember CO1 2

Key:
An entrepreneur is an advanced economist, is an individual who
introduces something new in the economy, a method of production, a
product with which consumers are not yet familiar, a new source of
raw material or new market and the like.
79952 What are the Characteristics of an entrepreneur? Analyze CO1 2

Key:
The Characteristics of an entrepreneur are
(a) Risk Bearer
(b) Hard Work
(c) Clear Objective
(d) Success and Achievement
(e) Independent
(f) Self Confidence
Topic: ENTREPRENEUR AND INTRAPRENEUR
80014 What is the difference between entrepreneur and Intrapreneur? Analyze CO1 2

Key:
An Entrepreneur is an independent business man and he bears the risk
fully. And the Intrapreneur is semi-independent business and he will
not bear the risk.
77676 What are the shared traits between Entrepreneur and intrapreneur? Analyze CO2 16
Analyse the advantages of being an intrapreneur than an
entrepreneur.

Key:
As both entrepreneur and intrapreneur share similar
qualities like conviction, creativity, zeal and insight,
the two are used interchangeably. However, the two
are different, as an entrepreneur is a person who takes
a considerable amount of risk to own and operate the
business, with an aim of earning returns and rewards,
from that business. He is the most important person
who envisions new opportunities, products, techniques
and business lines and coordinates all the activities to
make them real. on the contrary, an intrapreneur is an
employee of the organization who is paid remuneration
according to the success of the business unit, for which
he/she is hired or responsible. The primary difference
between an entrepreneur and intrapreneur is that the
former refers to a person who starts his own business
with a new idea or concept, the latter represents an
employee who promotes innovation within the limits of
the organization Key Differences Between
Entrepreneur and Intrapreneur The important
distinguishing points between entrepreneur and
intrapreneur, are given in the following points: An
entrepreneur is defined as a person who establishes a
new business with an innovative idea or concept. An
employee of the organisation who is authorised to
undertake innovations in product, service, process,
system, etc. is known as Intrapreneur. An
entrepreneur is intuitive in nature, whereas an
 intrapreneur is restorative in nature. An entrepreneur
uses his own resources, i.e. man, machine, money, etc.
while in the case of an intrapreneur the resources are
readily available, as they are provided to him by the
company. An entrepreneur raises capital himself.
Conversely, an intrapreneur does not need to raise
funds himself; rather it is provided by the company. An
entrepreneur works in a newly established company.
On the other hand, an intrapreneur is a part of an
existing organisation. Advantages of Being an
Intrapreneur vs Being an Entrepreneur Access to the
company's resources increases chances of success
Maintenance of a salaried position provides security in
case of failure Opportunity to gain valuable experience
that they can apply to future entrepreneurial ventures
Opportunity to cooperate with other employees on the
project Availability of advice and additional expertise
from the peers and coworkers Opportunity to test an
idea before executing in a live business environment
Possibility to bring change faster and on a larger scale
than one would if acted on his/her own
Topic: ENTREPRENEUR AND MANAGER
79950 State the difference between the entrepreneur and Evaluate CO1 2
manager.

Key:
An Entrepreneur starts a venture by setting up a new enterprise for his
personal goal achievement. But the manger renders his service to an
enterprise already in existence
77725 Discuss the key differences between Entrepreneur and Manager. Evaluate CO1 8

Key:
The word ‘manager‘ can be defined as a person who supervises his
team mates work and make sure that they complete the tasks
effectively and within the required time line. They are the ones
responsible to focus on business objectives and see that the work has
been accomplished as planned.

The Five primary functions of a manager are:
Planning
Organising
Directing
Motivating
Coordination and control.

In most of the organizations, every department or unit is assigned with
a manager. They will be directly in charge of all the work to be done.
However, there will be assistant managers who will be there under
him or a supervisor who is directly instructed by the manager.

characteristics of an Effective Manager:
Leadership
Communication
Organized
Experience
Knowledge
Reliability
Time Management
Confidence
Delegation
Respect your Employees

Topic: ENTREPRENEURIAL GROWTH

79967 What are the factors affecting entrepreneurial growth? Evaluate CO1 2

Key:
The economic factors that affect the entrepreneurial growth are
(a) Economic factors
(b) Non-Economic factors
(c) Government action
79968 List the economic factors that affects the Analyze CO1 2
entrepreneurial growth.
 Key:
(a) Capital
(b) Labour
(c) Raw Material
(d) Market
Topic: ENTREPRENEURSHIP
79951 What is the difference between entrepreneur and entrepreneurship? Analyze CO1 2

Key:
S.No Entrepreneur Entrepreneurship
1 Person Process
2 Organiser Organization
3 Innovator Innovation
4 Risk Bearer Risk Bearing

79959 Define Entrepreneurship. Remember CO1 2

Key:
According to Cole, Entrepreneurship is the purposeful activity of an
individual or a group of associated individuals undertaken to initiate,
maintain and aggrandize profit by production or distribution of goods
and services.
Topic: ENTREPRENEURSHIP IS GAP FILLING
79970 What is the gap filling function? Understand CO1 2

Key:
The most important feature of entrepreneurship is gap filling. The
main aspects of the entrepreneur are to fill the gap or make up the
deficiencies which always exist in the knowledge about the
production function.
Topic: EVALUATION OF ENTREPRENEURSHIP
77844 Explain the evaluation and Problems of EDPs. Evaluate CO2 8

Key:
Developing entrepreneurship has become a movement in India in the
recent years. EDPs have been considered as an effective instrument
for developing entrepreneurship in the countryside. Hundreds of EDPs
are conducted by some 686 organisations to impart entrepreneurial
training to participants in thousands.
The main objective of EDPs is to make the EDP trainee an enterprise
creator. Hence, it seems necessary to see whether, the objectives of
EDPs is fulfilled or not. In simple words, there is a need to have a
retrospective look into how many participants have actually started
their own enterprises after completing the training. This calls for the
evaluation of EDPs.

Topic: FACTORS AFFECTING THE ENTREPRENEURIAL

DEVELOPMENT
77664 Classify and explain in detail the factors affecting the entrepreneurial Evaluate CO1 16
development?

Key:
Entrepreneurship is influenced by four distinct factors: economic
development, culture, technological development and education. In
areas where these factors are present, you can expect to see strong and
consistent entrepreneurial growth.
These conditions may have both positive and negative influences on
the emergence of entrepreneurship. Positive influences constitute
facilitative and conducive conditions for the emergence of
entrepreneurship, whereas negative influences create inhibiting milieu
to the emergence of entrepreneurship.
Economic Factors
Economic environment exercises the most direct and immediate
influence on entrepreneurship. This is likely because people become
entrepreneurs due to necessity when there are no other jobs or because
of opportunity.
The economic factors that affect the growth of entrepreneurship are
the following:
1. Capital
Capital is one of the most important factors of production for the
establishment of an enterprise. Increase in capital investment in viable
projects results in increase in profits which help in accelerating the
process of capital formation. Entrepreneurship activity too gets a
boost with the
2. Labor
Easy availability of right type of workers also effect entrepreneurship.
The quality rather than quantity of labor influences the emergence and
growth of entrepreneurship. The problem of labor
3. Raw Materials
The necessity of raw materials hardly needs any emphasis for
establishing any industrial activity and its influence in the emergence
of entrepreneurship. In the absence of raw materials, neither any
enterprise can be established nor can an entrepreneur be emerged
4. Market
The role and importance of market and marketing is very important
for the growth of entrepreneurship. In modern competitive world no
entrepreneur can think of surviving in the absence of latest knowledge
about market and various marketing techniques.

5. Infrastructure
Expansion of entrepreneurship presupposes properly developed
communication and transportation facilities. It not only helps to
enlarge the market, but expand the horizons of business too. Take for
instance, the establishment of post and telegraph system and
construction of roads and highways in India. It helped considerable
entrepreneurial activities which took place in the 1850s.
Social Factors
Social factors can go a long way in encouraging entrepreneurship. In
fact it was the highly helpful society that made the industrial
revolution a glorious success in Europe. Strongly affect the
entrepreneurial behavior, which contribute to entrepreneurial growth.
The social setting in which the people grow, shapes their basic beliefs,
values and norms.
The main components of social environment are as follows:
1. Caste Factor
There are certain cultural practices and values in every society which
influence the’ actions of individuals. These practices and value have
evolved over hundred of years. For instance, consider the caste system
(the varna system) among the Hindus in India. It has divided the
population on the basis of caste into four division. The Brahmana
(priest), the Kshatriya (warrior), the Vaishya (trade) and the Shudra
(artisan): It has also defined limits to the social mobility of
individuals.
2. Family Background
This factor includes size of family, type of family and economic status
of family. In a study by Hadimani, it has been revealed that Zamindar
family helped to gain access to political power and exhibit higher
level of entrepreneurship.
3. Education
Education enables one to understand the outside world and equips him
with the basic knowledge and skills to deal with day-to-day problems.
In any society, the system of education has a significant role to play in
inculcating entrepreneurial values.In India, the system of education
prior to the 20th century was based on religion. In this rigid system,
critical and questioning attitudes towards society were discouraged.
The caste system and the resultant occupational
4. Attitude of the Society
A related aspect to these is the attitude of the society towards
entrepreneurship. Certain societies encourage innovations and
novelties, and thus approve entrepreneurs’ actions and rewards like
profits. Certain others do not tolerate changes and in such
circumstances, entrepreneurship cannot take root and grow.
5. Cultural Value
Motives impel men to action. Entrepreneurial growth requires proper
motives like profit-making, acquisition of prestige and attainment of
social status. Ambitious and talented men would take risks and
innovate if these motives are strong. Psychological Factors
Many entrepreneurial theorists have propounded theories of
entrepreneurship that concentrate especially upon psychological
factors. These are as follows :
The theory states that people with high need-achievement are
distinctive in several ways. They like to take risks and these risks
stimulate them to greater effort. The theory identifies the factors that
produce such people. Initially McClelland attributed the role of
parents, specially the mother, in mustering her son or daughter to be
masterful and self-reliant. Later he put less emphasis on the parent-
child relationship and gave more importance to social and cultural
factors. He concluded that the ‘need achievement’ is conditioned more
by social and cultural reinforcement rather than by parental influence
and such related factors.
2. Withdrawal of Status Respect
 There are several other researchers who have tried to understand the
psychological roots of entrepreneurship. One such individual is
Everett Hagen who stresses the-psychological consequences of social
change. Hagen says, at some point many social groups experience a
radical loss of status. Hagen attributed the withdrawal of status respect
of a group to the genesis of entrepreneurship.
3. Motives
Other psychological theories of entrepreneurship stress the motives or
goals of the entrepreneur. Cole is of the opinion that besides wealth,
entrepreneurs seek power, prestige, security and service to society.
Stepanek points particularly to non-monetary aspects such as
independence, persons’ self-esteem, power and regard of the society.
Topic: FUNCTION OF AN ENTREPRENEUR
77634 “Determination of cost is an important function of an Analyze CO1 16
Entrepreneur”? Explain?

Key:
The price you charge for your product or service is one
of the most important business decisions you make.
Setting a price that is too high or too low will - at best -
limit your business growth. At worst, it could cause
serious problems for your sales and cash flow.
If you're starting a business, carefully consider your
pricing strategy before you start. Established
businesses can improve their profitability through
regular pricing reviews.
When setting your prices you must make sure that the
price and sales levels you set will allow your business
to be profitable. You must also take note of where your
product or service stands when compared with your
competition.
There will be times when you need to change your
prices. But before you do, you should analyse the
impact on your profitability of any proposed price
change.
There are two key questions you will need to answer:

What effect will the price change have on the

volume of sales?
What will the effect be on the profit per sale?

Increasing prices
Increasing prices can improve your profitability even
though your sales volume may drop.
If you are increasing your prices, always explain to
your customers why you are doing it. You can use the
price change as an opportunity to re-emphasize the
benefits you offer. A good explanation can also
strengthen your relationship with a customer.
There are also ways that you can hide price increases.
For example, you might:

introduce new, higher-priced products or services

and make older, cheaper ones obsolete
lower the specification - and your costs - while
maintaining the same price

Topic: IMPACT OF ENTREPRENEURSHIP.

77703 Explain the revolution impact of entrepreneurship. Understand CO1 8

Key:
Many people around the world are calling for an
―entrepreneurial revolution to fix social and economic problems.
This call naively assumes that more entrepreneurs are needed to
address these issues. Increasing the number of entrepreneurs,
however, is not as critical as persuading entrepreneurs to improve
their societies through growth, innovation and social transformation.
The revolution should be one of transforming contemporary
entrepreneurial culture to make it more socially minded.
Entrepreneurs are known for creating new ventures that creatively
solve problems. This basic definition, I believe, has to be expanded to
conceive of entrepreneurs as powerful agents of cultural change
capable of transforming their societies. This does not mean taking
time after work to address social issues. It means consciously
 incorporating social goals into entrepreneurs‘strategic thinking as a
means to maximize personal and collective benefits. It demands
getting rid of the paradigm that only governments and
established companies are capable of addressing social needs.
Entrepreneurs, who operate closer to the people, are in a perfect
position to identify and to tackle critical problems, such as poverty
and the lack of access to health and education. Contemporary
societies are demanding more efficient and socially
interconnected ways to satisfy their necessities. To make this
happen, entrepreneurs must understand that, by establishing new
ventures that aim both to create economic prosperity and to spur
social development, they are ensuring their long-term sustainability.
More developed nations translate into platforms for larger
growth and even internationalization.

Topic: INNOVATION
79944 What is Innovation? Create CO1 2

Key:
An entrepreneur is meant for Innovation. In the present world the
taste of the customer keeps on changing so the entrepreneurs initiate
research and innovating activities to produce goods to satisfy the
customers changing demand for the product.
Topic: INTRAPRENEUR
79955 What is Intrapreneur? Understand CO1 2

Key:
The term Intrapreneur was coined in America in the late seventies. In
simple word, new entrepreneur coming from a large industrial
organization with a new innovating idea is called intrapreneur.

Topic: PROBLEMS OF ENTREPRENEURSHIP
77694 Discuss the problems of Entrepreneurship in detail. Analyze CO1 16

Key:
Traditional Society
• Indian society is, by and large, in the group of traditions,
conservatism and blind faith. Traditionally, certain jobs are not
considered good, even today.
• Due to caste system, people hesitate to leave their traditional
occupations
• Hence people lack business interest, as also the risk bearing
capacity and constructive thinking.

Hereditary Work
The selection of work, occupation and business in India is not in
accordance with interest, capacity and feelings. Rather, it is on the
basis of hereditary adaption, caste system, religion and gender
difference, etc. As a result the entrepreneurs are not able to select the
business and industry, according to their capacity, interest and
motivations.

Unproductive Expenditure People keep their savings, hidden with
themselves or go on spending it on marriages, birthday parties,
religious rituals, ornaments, immovable property and luxury goods,
etc.

Lack of Infrastructure Facility Infrastructure facilities, required for
development of entrepreneurship, like: means of transportation and
communications, banks, insurance, electricity, water, raw materials,
roads, stock market services capital market, organized product
marketing, etc. have lacked in our country and hence the new
entrepreneurs have to face difficulty in setting up the industries and
the development of industries has been slow.

Lack of Enterprising Mentality Development of entrepreneurship
depends upon the nature of human resources. However, several
changes have taken place in the mentality of these resources, which
have become obstructions in the development of entrepreneurship,
like: (i) People do not have high aspirations for gaining achievements.
(ii) They take no interest in innovations. (iii) Most of the young
people prefer to do some service, in place of going towards
establishing and operating any business or industry (iv) The risk
bearing capacity and ability to face contingencies of people have
 reduced. (v) People lack high business and technical abilities. (vi)
Initially, people participate in entrepreneurship development
programmes which complete devotion. But after some time, their
mentality goes on changing and they leave that sometimes they leave
the idea of adopting entrepreneurship, after completing that
programme.

Cultural Values Religion has deep effect on Indians. Our ideal has
been, “Simple living, high thinking”. In Indian culture, much
importance has not been given to material gains, personal property,
economic pursuits and high standard of living

Lack of Favorable Environment Every section of the society like
workers, consumers, investors, government, etc. has its contribution,
in operation of an industry. However, unfortunately, enthusiasm
towards work lacks in our country. The consumers view the
entrepreneurs, with sense of suspicion, capital is always scarce,
policies of the government are also not very practical, competition is
not healthy and has become cut throat

Topic: ROLE OF ENTREPRENEURSHIP
77712 Briefly explain the role of Entrepreneurship in Economic Evaluate CO1 16
Development.

Key:

1. Wealth Creation and Sharing: By establishing the business
entity, entrepreneurs invest their own resources and attract capital (in
the form of debt, equity, etc.) from investors, lenders and the public.
This mobilizes public wealth and allows people to benefit from the
success of entrepreneurs and growing businesses. This kind of pooled
capital that results in wealth creation and distribution is one of the
basic imperatives and goals of economic development.

2. Create Jobs: Entrepreneurs are by nature and definition job
creators, as opposed to job seekers. The simple translation is that
when you become an entrepreneur, there is one less job seeker in the
economy, and then you provide employment for multiple other job
seekers. This kind of job creation by new and existing businesses is
again is one of the basic goals of economic development. This is why
the Govt. of India has launched initiatives such as StartupIndia to
promote and support new startups, and also others like the Make in
India initiative to attract foreign companies and their FDI into the
Indian economy. All this in turn creates a lot of job opportunities, and
is helping in augmenting our standards to a global level.

3. Balanced Regional Development: Entrepreneurs setting up new
businesses and industrial units help with regional development by
locating in less developed and backward areas. The growth of
industries and business in these areas leads to infrastructure
improvements like better roads and rail links, airports, stable
electricity and water supply, schools, hospitals, shopping malls and
other public and private services that would not otherwise be
available.

Every new business that locates in a less developed area will create
both direct and indirect jobs, helping lift regional economies in many
different ways. The combined spending by all the new employees of
the new businesses and the supporting jobs in other businesses adds to
the local and regional economic output. Both central and state
governments promote this kind of regional development by providing
registered MSME businesses various benefits and concessions.

4. GDP and Per Capita Income: India’s MSME sector, comprised of
36 million units that provide employment for more than 80 million
people, now accounts for over 37% of the country’s GDP. Each new
addition to these 36 million units makes use of even more resources
like land, labor and capital to develop products and services that add
to the national income, national product and per capita income of the
country. This growth in GDP and per capita income is again one of
the essential goals of economic development.

5. Standard of Living: Increase in the standard of living of people in
a community is yet another key goal of economic development.
Entrepreneurs again play a key role in increasing the standard of
living in a community. They do this not just by creating jobs, but also
by developing and adopting innovations that lead to improvements in
 the quality of life of their employees, customers, and other
stakeholders in the community. For example, automation that reduces
production costs and enables faster production will make a business
unit more productive, while also providing its customers with the
same goods at lower prices.

6. Exports: Any growing business will eventually want to get started
with exports to expand their business to foreign markets. This is an
important ingredient of economic development since it provides
access to bigger markets, and leads to currency inflows and access to
the latest cutting-edge technologies and processes being used in more
developed foreign markets. Another key benefit is that this expansion
that leads to more stable business revenue during economic downturns
in the local economy.

7. Community Development: Economic development doesn’t always
translate into community development. Community development
requires infrastructure for education and training, healthcare, and
other public services. For example, you need highly educated and
skilled workers in a community to attract new businesses. If there are
educational institutions, technical training schools and internship
opportunities, that will help build the pool of educated and skilled
workers.

Topic: SUCCESSFUL ENTREPRENEURSHIP

77786 Elucidate the characteristics needed for successful Entrepreneurship. Understand CO1 8

Key:
1. Creative

Entrepreneurship starts with an idea. To be successful, you need to
always be thinking of new ideas and better ways of doing things. In an
interview in Martyn Lewis's book "Reflections on Success," Virgin
Airlines founder Richard Branson said, "I've gone into business, not to
make money, but because I think I can do it better than it's been done
elsewhere. And, quite often, just out of personal frustration about the
way it's been done by other people."Entrepreneurs are not satisfied
with the status quo. They think outside the box and look for
opportunities to come up with new solutions.

2. Passionate

Perhaps the most important characteristic for entrepreneurs, passion is
essential to any business owner or working professional's success.
Without passion, there is no reason for your work and no drive to do
it. Entrepreneurs love what they do and are extremely dedicated to the
businesses they create. To be successful, you must be confident in
yourself and your business, and you must be proactive with what you
do and how you do it.




3. Motivated

In an interview with The Computerworld Smithsonian Awards
Program, the late Apple founder Steve Jobs said, "I'm convinced that
about half of what separates the successful entrepreneurs from the
non-successful ones is pure perseverance."Because of their passion for
their ideas, entrepreneurs are willing to put in the long hours and hard
work required to launch and run a successful new business. Are you
self-motivated? Entrepreneurs are their own boss, which means there's
no one telling them to do things. You must be in charge of your own
time and how you spend it.

4. Optimistic

Do you see the glass half empty or half full? For entrepreneurs, it's
always half full. Entrepreneurs always look on the bright side and are
constant dreamers. They look at how they can do things better and
make the world a better place. They never dwell on the past or the
negative. Instead, they focus on moving forward and moving up.When
they're confronted with challenges, entrepreneurs don't see them as
problems; they see them as opportunities. Challenges fuel
entrepreneurs and make them reach higher and do more.

 5. Future-oriented

Because entrepreneurs are focused on moving forward, they are
always looking toward the future. Entrepreneurs are very goal-
oriented and know exactly what they want. They set their goals and
everything they do is aimed at achieving those goals. Having a strong
vision helps propel you toward accomplishment. Consider setting a
goal for yourself - a north star that can guide you on your path to
success.

6. Persuasive

To be successful in business, you have to know business. If you're a
people person and know how to get people to listen to you, you could
be a successful entrepreneur.Especially when first starting out,
entrepreneurs need to gain buy-in from those around them on their big
idea. If it's an out-of-the-box idea, which it usually is, many people
will be skeptical before giving their support or investing any money.
That's why entrepreneurs need to use their persuasiveness to sell
themselves and their ideas.

7. Flexible

According to professional development coach Ruchira Agrawal in an
article for Monster, "As an entrepreneur, you'll typically start out as a
'solopreneur,' meaning you will be on your own for a while. You may
not have the luxury of hiring a support staff initially. Therefore, you
will end up wearing several different hats, including secretary,
bookkeeper and so on."

Entrepreneurs know how to adapt to unfamiliar situations. If their
business requires that they learn how to build a website or send an
invoice, they'll do it. Whatever it takes, entrepreneurs are ready and
willing. They always approach things with an open mind and are
willing to change course if they need to.

8. Resourceful

In business, problems aren't a matter of if, but when. Entrepreneurs do
not shy away from challenges or conflicts. Instead, they face them
head on and come up with a solution. They know how to solve
problems effectively. Entrepreneurs also know how to make the most
of what they have. Time, money and effort are never used
haphazardly. Everything has a plan and a purpose.

9. Adventurous

In an interview with Y Combinator president Sam Altman, Facebook
founder Mark Zuckerberg said, "In a world that's changing so quickly,
the biggest risk you can take is not taking any risk."Entrepreneurs
know that to be successful, they must be willing to take risks. While
they don't mind walking on the wild side, they don't take risks lightly.
They know how to plan for the unknown and make a calculated
decision that is best for them and their business.

10. Decisive

There is no room for procrastination in business. Entrepreneurs know
what needs to be done and don't hesitate to make the decisions that
will lead them to success. They don't let opportunities pass them by;
instead, they seize the day and get the job done.

Mapping
Questions in Unit-2 Pattern Marks
COs
Topic: CASE STUDY
77837 ‘Hand Made In India’ Project to Turn Artisans into Entrepreneurs’ Analyze CO2 16
After engaging with business professionals, Entrepreneurship
Development Institute of India (EDII) will now look to develop
entrepreneurial competencies in about 5,000 weavers, artisans and
traders to promote hand-made art.
Named ‘Hand Made in India’ (HMI), the project will be
implemented in three years and in the first phase, it has been extended
to six centres. These handloom clusters include Bhuj and
Surendranagar in Gujarat; Bargarh in Odisha; Kamrup in Assam;
Maheshwar in Madhya Pradesh, and Salem in Tamil Nadu.
The Institute has developed a plan which involves upgrading the skills
 of the weavers, introducing new-age marketing strategies, ensuring
increased credit availability, roping-in the younger generation to the
weaving tradition. These measures are targeted to improve the income
and quality of life of the weavers in the clusters.
Women empowerment will be given special attention in the weaving
and allied activities.
“Traditional weavers and artisans in the handicraft industry have long
struggled to survive due to the advent of powerlooms. However, the
charm of a hand-woven fabric has never faded and there is more
awareness among people about such products. To calibrate these
artisans to newer markets and to the shift in customer preference for
sustainable products, we have initiated the Hand Made in India (HMI)
project,” said Raman Gujral, Head, Southern Region, EDII.
The aim of the initiative is to revive the lives of weavers by
developing entrepreneurial competencies in them. The project would
concentrate on product development to capture larger and high-end
markets with a special focus on exports. New collections and clothing
line through product diversification, in collaboration with well-known
fashion designers and fashion institutes, will be introduced through
this project
Questions:
1. According to you will this Hand Made in India Campaign will
succeed? If yes what would be the critical success factors that would
help this project?
2. What are the other ways by which Handicraft industry can be
revitalized? Explain in brief.

Key:
1 Yes this project will be a grand success as the Government of India
is playing a key role in upgrading the skill set of weavers and artisans.
India known for its rich legacy would surely capitalize this
opportunity and the sector will get a boost.
2. Handicraft Industry can be revitalized in the following ways.
Base Line Survey & Mobilization of Artisans
Design & Technology Upgradation
Human Resource Development
Direct Benefit to Artisans
Infrastructure and Technology Support
Research and Development
Marketing Support & Service
Topic: COMPONENTS OF ENTREPRENEURIAL

COMPETENCIES
77460 What are the various components of entrepreneurial competencies? Evaluate CO2 2

Key:
Twenty five major areas of entrepreneurial competencies are
identified for the present study which include : Concern for high
quality, Self confidence, Locus of control, Dealing with failures,
Tolerance for ambiguity, Self esteem, Performance, Initiative, Sees
and acts on opportunity, Persistence, Assertiveness, Need

Topic: EDP'S
77455 State EDP’s Process Apply CO2 2

Key:
(a) Selection of person with the required potential in terms of
knowledge attitudes.
(b) Designing techniques for training.
(c) Selection and training process.
(d) Survey of environment
(e) Strategies to make ED effective.
77461 What are the objectives of EDP’s? Remember CO2 2

Key:
(a) Develop and strengthen their entrepreneurial quality
(b) Select Product / Project
(c) Acquire the basic management skills.
77477 What is the need of EDP? Remember CO2 2

Key:
Need of entrepreneurship development programme (EDP)
Unemployment is one of the most important problems confronting
 developing and underdevelopment countries, EDP's enable
prospective entrepreneurs in the setting up of their own units, thus
enabling them to get self employmen
Topic: EFFECTIVENESS OF ENTREPRENEURSHIP

DEVELOPMENT
77951 What are the basic criteria to access the Understand CO2 16
effectiveness of Entrepreneurship Development
Program (EDP)?

Key:
· Activity level of respondents
· New enterprises established
· Total investment made
· No. of people employed
· No. of jobs created
· Increase in profit
· Increase in sales

Topic: ENTREPRENEURIAL BUSINESS

77553 What is an entrepreneurial business? Understand CO2 2

Key:
The capacity and willingness to develop, organize and manage
a business venture along with any of its risks in order to make a
profit. The most obvious example of entrepreneurship is the starting
of new businesses

Topic: ENTREPRENEURIAL COMPETENCIES

77471 What are the competencies for entrepreneurial Understand CO2 2
success?

Key:
There are specific skills and competencies that help
make entrepreneurs successful. Skills include the
ability to multi-task and promote interest in
abusiness. Competencies include initiative and
creativity and the ability to solve problems and take
risks.
77472 what is entrepreneurial competencies ? Remember CO2 2

Key:
Entrepreneurial competencies can be defined as underlying
characteristics such as generic and specific knowledge, motives, traits,
self-images, social roles, and skills which result in venture birth,
survival, and/or growth
Topic: ENTREPRENEURIAL COMPETENCY.
77828 Give a detailed account on Entrepreneurial Understand CO2 16
Competency.

Key:
1. Give a detailed account on Entrepreneurial Competency
Entrepreneurial competency is defined as the individual
characteristics. Entrepreneur is a person who undertakes risk for
gaining profit in the business venture. According to Baum & Locke
(2004) “Entrepreneurs must also be willing to experiment different
strategies in the pursuit of profitable outcome because it is
the entrepreneur’s energy, creativity & motivation that trigger the
production of superior product & services”. Therefore,
entrepreneurship requires certain strategic skills for
profitable functioning. Entrepreneurship Development Institute
of India, Ahmadabad, identified certain factors which are
required by entrepreneur to give the success to the business
as well as to the economy of the country. These factors are
initiative, see and act on opportunities, persistence, knowing,
concern for high quality of work, commitment to work contract,
persuasion, efficiency orientation, systematic planning, problem
solving, self-confidence, assertiveness, use of influence
strategies, monitoring and concern of employee welfare.
Entrepreneurial competency thus becomes critical for an SME to
become competitive in the globalized world. Entrepreneurs play a
very important role for business survival and its success.
1. Give a detailed account on Entrepreneurial Competency
 Entrepreneurial competency is defined as the individual
characteristics. Entrepreneur is a person who undertakes risk for
gaining profit in the business venture. According to Baum & Locke
(2004) “Entrepreneurs must also be willing to experiment different
strategies in the pursuit of profitable outcome because it is
the entrepreneur’s energy, creativity & motivation that trigger the
production of superior product & services”. Therefore,
entrepreneurship requires certain strategic skills for
profitable functioning. Entrepreneurship Development Institute
of India, Ahmadabad, identified certain factors which are
required by entrepreneur to give the success to the business
as well as to the economy of the country. These factors are
initiative, see and act on opportunities, persistence, knowing,
concern for high quality of work, commitment to work contract,
persuasion, efficiency orientation, systematic planning, problem
solving, self-confidence, assertiveness, use of influence
strategies, monitoring and concern of employee welfare.
Entrepreneurial competency thus becomes critical for an SME to
become competitive in the globalized world. Entrepreneurs play a
very important role for business survival and its success.

Topic: ENTREPRENEURIAL MOBILITY

77547 What is entrepreneurial Mobility? Remember CO2 2

Key:
· Entrepreneurial Mobility means movement of entrepreneurs from
one location to another and similarly from one occupation to another,
which affect the pace and pattern of entrepreneurship development.
78085 Elucidate the reasons for Entrepreneurial Mobility. Understand CO2 16

Key:
What makes the entrepreneurs mobile? There cannot be a common
factor influencing all the entrepreneurs to move from one location to
another and similarly from one occupation to another. In fact,
different factors influence the entrepreneurial mobility differently.
These factors may serve as 'pull' and 'push' factors. Following are
some important factors which generally influence the entrepreneurial
mobility in a given situation and time:
1. Education:
Education enlarges one's thinking and understanding horizons. It
enables one to comprehend conditions more easily and clearly and in
a better manner. An educated person can also easily adjust with the
changed environment, hold better discussion and communicate in a
more convincing manner. That an educated entrepreneur tends to be
more mobile than an uneducated one is supported by empirical
evidences also.
2. Experience:
An entrepreneur's past experience in business and industry also
increases his/her propensity to move. The reason is not difficult to
seek. An experienced entrepre-neur better perceives the available
opportunities, better analyses his/her strengths and weaknesses and
also better understands the complexities involved in running an
enterprise. That the technical experience influences the
entrepreneurial mobility is indicated by an increasing number of
persons with technical knowledge and experience assuming to the
entrepreneurial roles at distant places away from their native one
3. Availability of Facilities:
A tendency is noticed among the entrepreneurs to move from the
areas with no or less facilities to the areas with more and better
facilities. Heavy concentration of industries in Okhla, Ghaziabad and
Faridabad near Delhi represent such examples. The reason lies in the
fact that these areas have proximity to various agencies, facilities like
transport, communication, power, market, etc.
3. Political Conditions:
Evidences are available to cite that the entrepreneurial mobility is
influenced by the political factors also. For examples, the well-known
enterprising Punjabi community, lost almost everything during the
partition and were compelled to move to every nook and corner of the
country in the pursuit of profit opportunities and shaped their lucks.
Similarly, the Marwaris known as the most 'footloose' community in
India also left their home and hearth long ago compelled by the
historical circumstances.



5. Size of Enterprise:
Larger business houses are found more mobile than smaller ones.
 Initially, the entrepreneurs try to consolidate their business position at
a place, scale the commanding heights in the area, attain the
dominating position and thereafter try to successfully seize the
business opportunities elsewhere. The Indian business giants /houses
like Tata, Birla, Dalmia etc. represent such examples. Although one
may add more factors to this list, yet the said factors seem to be the
common ones influencing the entrepreneurial mobility. Having known
the factors influencing the entrepreneurial mobility, it seems in the
fitness of the context to look at the dimensions of the entrepreneurial
mobility. Hence, in what follows is the occupational and locational
mobility of the entrepreneurs

Topic: ENTREPRENEURIAL PROCESS

77586 What is entrepreneurial process? Apply CO2 2

Key:
The entrepreneurial process is a process of pursuing a new venture
that involves more than just problem solving in a typical management
position. An entrepreneurmust find, evaluate, and develop an
opportunity by overcoming the forces that resist the creation of
something new.
Topic: ENTREPRENEURSHIP DEVELOPMENT
PROGRAMME

78108 What is Entrepreneurship Development Programme (EDP)? How Analyze CO2 8

does it help an individual to become an entrepreneur? Explain in brief

Key:
Entrepreneurship Development Programme (EDP) is a programme
which helps in developing the entrepreneurial abilities. The skills that
are required to run a business successfully is developed among the
people through this programme. Sometimes, people may have skills
but it requires polishing and incubation. This programme is perfect for
them. This programme consists of a structured training process to
develop an individual as an entrepreneur. It helps the person to
acquire skills and necessary capabilities to play the role of an
entrepreneur effectively. As per National Institute of Small Industry
Extension Training, Hyderabad, an EDP is an effort of converting a
person to an entrepreneur by passing him through a thoroughly
structured training. An entrepreneur is required to respond
appropriately to the market and he/she is also required to understand
the business needs. The skills needed are varied and they need to be
taken care in the best possible way. EDP is not just a training
programme but it is a complete process to make the possible
transformation of an individual into an entrepreneur. This programme
also guides the individuals on how to start the business and effective
ways to sustain it successfully.
Objectives of EDP
The objective of this programme is to motivate an individual to
choose the entrepreneurship as a career and to prepare the person to
exploit the market opportunities for own business successfully. These
objectives can be set both in the short-term and long-term basis.

Short-term objectives: These objectives can be achieved

immediately.In the short-term, the individuals are trained to be
an entrepreneur and made competent enough to scan existing
market situation and environment. The person, who would be
the future entrepreneur, should first set the goal as an
entrepreneur. The information related to the existing rules and
regulations is essential at this stage.
Long-term objectives: The ultimate objective is that the trained
individuals successfully establish their own business and they
should be equipped with all the required skills to run their
business smoothly.

The overall objectives of EDP are mainly to help in rapid

industrialisation by supplying skilled entrepreneurs. At the same time,
it also industrialises underdeveloped areas. The performance of small
and medium scale industries are expected to improve by this and
therefore providing a huge scope of employment generation in these
sectors. This programme primarily aims at providing self-employment
to the young generation.
An Entrepreneurship Development Programme primarily plays four
roles to help an individual to become an entrepreneur. They are:



Stimulatory Role: It aims at influencing people in large

number to be the entrepreneur. This includes:

1. developing managerial, technical, financial, and marketing skill

2. inculcating personality traits
3. promotes and reforms entrepreneurial behaviour and values
4. identifying potential entrepreneur applying scientific methods
5. motivational training and building proper attitude
6. strengthening the motive of a person and giving recognition
7. the valuable know-how of the local products and the processes
help in selection of products, preparation of project reports

Supportive Role: It helps in the following ways:

1. registration of the business

2. procurement of fund
3. arrangement of land, power, water, shed etc.
4. support in purchase of right kind of machinery and equipment
5. supply of raw materials and common facilities
6. Providing tax relief, subsidy etc.
7. guidance in product marketing
8. support for management consultancy

Sustaining Role: It aims at providing an effective safeguard to

businesses to sustain against the cut-throat market competition. This
includes:

1. help in modernisation, expansion, and diversification

2. additional financing for further development
3. deferring interest payment
4. creating new marketing processes
5. helping access to improved services and facility centres

Socio-economic Role: It aims at upgrading the socio-economic status

of the public and includes:

1. identifying entrepreneurial qualities in practicality

2. creating employment opportunities in micro, small, and medium
industries on an immediate basis
3. arresting concentration of industries by supporting regional
development in a balanced manner
4. focusing on the equal distribution of income and wealth of the
nation
5. channelizing the latent resources for building an enterprise

The Govt. of India has established specialised institutions to boost up

the rate of entrepreneurial development in India like NIESBUD in
Noida, MSME-DI for small scale industries, NIMSME in
Yousufguda, Hyderabad, EDI, NSTEDB, IED and CED in different
state

Topic: ENTREPRENEURSHIP DEVELOPMENT TRAINING

77757 Evaluate CO2 16
Elaborate on the measure taken by Government of India to promote
Entrepreneurship through Entrepreneurship Development Training
Programme.

Key:
Entrepreneurship development is one of the key elements for
promotion of MSME sectors. To undertake this task on regular basis,
the Ministry has set up three national level institutes. These are 1)
National Institute of Micro, Small and Medium
Enterprises, Hyderabad; ii) National Institute of Entrepreneurship and
small Business Development, Noida; and iii) Indian Institute of
Entrepreneurship, Guwahati. All would be entrepreneurs, can avail the
multi-faceted training programmes geared for entrepreneurship cult
which are tailor-made for their individual needs and application
within the country. Various training programmes are organized on
regular basis to cultivate the latent qualities in youths by enlightening
them on various aspects that are necessary to be considered while
setting up micro or small enterprises. These training programmes have
 attracted the attention of the educated unemployed youths and have
created confidence in them which led to the self employment and
creation of better employment. The individual MSME-DIs conduct
the following training programmes:-
a) Industrial Motivation Campaign
b) Entrepreneur Development Programme
c) Entrepreneurship Skill Development Programme
d) Management Development Programme
e) Skill Development
f) Business Skill Development Programme

Topic: FACTORS THAT DRIVE PEOPLE TOWARDS

ENTREPRENEURSHIP
77579 What motivational factors that drive People towards Evaluate CO2 2
Entrepreneurship?

Key:
· Passion. You cannot be a lifeless soul who doesn't believe in anything
and neither wishes to believe.
· Self-Reliance.
· Feeling of accomplishment.
· Personal Growth.
· Sense of Control.

Topic: FACTORS THAT MOTIVATE PEOPLE

77606 What are the internal factors that motivate people to Analyze CO2 2
go into business?

Key:
(a) Desire to do something new
(b) Educational Qualification
(c) Technical background

Topic: MASLOW’S HIERARCHY OF NEEDS THEORY

77774 Give a detailed account on Maslow’s hierarchy of Needs theory Remember CO2 16

Key:
The main content theories are: Maslow’s needs hierarchy, Alderfer’s
ERG theory, McClelland’s achievement motivation and Herzberg’s
two-factor theory.
Maslow – hierarchy of needs
This is the earliest and most widely known theory of motivation,
developed by Abraham Maslow (1943) in the 1940s and 1950s.
1. Physiological needs (e.g. food, water, shelter,
sleep)
It includes the most basic needs for humans to survive,
such as air, water and food. Maslow emphasized, our
body and mind cannot function well if these
requirements are not fulfilled.
These physiological needs are the most dominant of all
needs. So if someone is missing everything in his/her
life, probably the major motivation would be to fulfil
his/her physiological needs rather than any others. A
person who is lacking food, safety, love (also sex) and
esteem, would most probably hunger for food (and also
for money, salary to buy food) than for anything else.
.
2. Safety and security (secure source of income, a
place to live, health and well-being)
If the physiological needs are relatively well contented,
new needs will appear, the so called safety needs.
Safety needs refer to a person’s desire for security or
protection. Basically everything looks less important
than safety and protection (the physiological needs
even sometimes). The healthy and fortunate adults in
our culture are largely satisfied in their safety needs.
The peaceful, sure, safety and unwavering society
makes us feel in safety enough from criminal assaults,
murder, unbelievable natural catastrophes, and so on.
In that case people no longer have any safety needs as
 first-line motivators.
Meeting with safety needs demonstrated as a
preference for insurance policies, saving accounts
3. Belongingness and love (integration into social
groups, feel part of a community or a group;
affectionate relationships)
If both the physiological and the safety needs are
fulfilled, the affection, love and belongingness needs
come into prominence. Maslow claimed people need to
belong and accepted among their social groups. Group
size does not mean anything: social groups can be
large or small. People need to love and be loved – both
sexually and non-sexually – by others. Depending on
the power and pressure of the peer group, this need
for belonging may overbear the physiological and
security needs.
4. Esteem (respect for a person as a useful,
honourable human being)
In our society most people long for a stable and high
valuation of themselves, for the esteem of others and
for self-respect or self-esteem.
Esteem means being valued, respected and
appreciated by others. Humans need to feel to be
valued, such as being useful and necessary in the
world. People with low self-esteem often need respect
from others. Maslow divided two types of esteem
needs: a ‘lower’ version and a ‘higher’ version. The
‘lower’ version of esteem is the need for respect from
others: for example attention, prestige, status and
loving their opinion. The ‘higher’ version is the need
for self-respect: for example, the person may need
independence, and freedom or self-confidence.
5. Self-actualization (individual’s desire to grow and
develop to his or her fullest potential)
‘What humans can be, they must be.’ (Maslow, 1954)
Self-actualization reflects an individual’s desire to
grow and develop to his/her fullest potential. People
like opportunities, choosing his/her own versions,
challenging positions or creative tasks. Maslow
described this level as the ‘need to accomplish
everything that one can, to become the most that one
can be’. Maslow believed that people must overcome
their other needs – described above -, not only achieve
them. At this level, individual differences are the
largest.
As each level is adequately satisfied, we are then
motivated to satisfy the next level in the
Deficiency needs – The very basic needs for survival
and security.
These needs include:
• physiological needs
• safety and security needs
• social needs – belongingness and love
• esteem needs
It may not cause a physical indication if these
‘deficiency needs’ are not fulfilled, but the individual
will feel anxious and tense. So the most basic level of
needs must be fulfilled before a person wants to focus
on the secondary or higher level needs.
Growth needs – Personal growth and fulfilment of
personal potential.
These needs include:
• self-actualisation needs
This hierarchy is not as rigid as we may have implied. For example,
there are some humans for whom self-esteem or self-actualization
seems to be more important than love or belonging. The popularity of
this theory of motivation rooted in its simplicity and logic
Topic: MOTIVATING THE ENTREPRENE
77815 Explain the factors motivating the Entrepreneurs to Understand CO2 16
take up Entrepreneurship.

Key:
(a) Entrepreneurial Ambition (i) To make money (ii) To
 gain social prestige (iii) To secure self-employment or
independent living (b) Compelling Reasons (i)
Unemployment or dissatisfaction with existing job or
occupation (ii) To use technical or professional
knowledge and skills (iii) To put the idle funds of the
entrepreneur to use (c) Facilitating Factors (i) Previous
knowledge, experience or association with same or
similar of activity (ii) Influence and encouragement by
family member, friends and relatives (iii) Imitation of
successful entrepreneurs. Internal And External
Factors R.A. Sharma has studied the factors that
prompted new entrepreneurs to enter industry and has
classified them in two major categories: the factors
that are internal to the entrepreneur and those
external to the entrepreneur. The internal factors
make the personality of an entrepreneur and induce
the person to adopt entrepreneurship. Without the
presence of internal factors entrepreneurial activity in
a person cannot start. However once the
entrepreneurial tendencies germinate in a person, the
external factors start playing an important role in the
person becoming an entrepreneur and starting his own
business venture. Internal Factors · Desire to work
independently · Occupational experience ·
Technical/Trade/Qualification and knowledge External
Factors · Supportive government policies · Availability
of financial assistance · Ancillary support · Availability
of infrastructural facilities like industrial plot,
electricity, technical facilities etc. People become
industrial entrepreneurs because of three main
reasons: 1. Desire to do something independently in
life. 2. Availability of technical/manufacturing or trade
knowledge and skill with prospective entrepreneur. 3.
Support from government and other agencies.

Topic: MOTIVATION
79997 Define the term Motivation. Understand CO2 2

Key:
Motivation is the willingness to exert high levels of effort towards
organizational goal, conditional by
the effort ability to satisfy some individual need
79998 What is Motivation Process? Analyze CO2 2

Key:
Awareness of entrepreneur need is the first step in the
motivational process. The motives are directed towards the
realization of certain goals, which in turn determine
entrepreneur behavior. This entrepreneur behavior leads to
goal directed behavior. In order to satisfy and achieve goal, an
entrepreneur looks for a suitable action.

Topic: NATURE OF MOTIVATION

80008 State any two nature of motivation. Analyze CO2 2

Key:
(a) Motivation is internal to man
(b) A single motive can leads to different behavior
(c) A different motive can leads to single behavior
Topic: NATURE OF MOTIVATION1
77739 What is Entrepreneur Motivation? Explain the Understand CO2 16
nature and process of motivation.

Key:
1.Psychological concept: Motivation is related to mental state of a
person. So, motivation is a psychological aspect. Psychology is a
mental condition which arises in the mind of a person and directs to
act in a particular way. Motivation is related with the needs and
motives which generate within an individual. It is the function of
management which encourages the capable person to do work with his
maximum efficiency. A man having physical, mental and technical
capability may not be ready to work properly. But motivation
 techniques encourage to work with great efficiency.

2.Never ending process: Motivation is important till the existence of

the management. It is an unending process. It is dynamic in nature.
The needs of a person arise continuously one after another. For
instance- a man satisfies one want or one set of wants and after getting
satisfaction again he feels another want and tries to satisfy the same.
As desires, wants, needs, and motives are dynamic and changes occur
frequently, the motivation too should be considered as dynamic.

3.Related to human resources: Motivation is related to human

resources and needs. It is concerned with the feelings, desires, motives
and needs of a man. Ofcourse, a man may be motivated but we cannot
motivate other factors of production or resources like capital, land and
machine.

4.Cause and effect of human satisfaction: A man works to fulfill his

own motive. Wants, desires, environment, condition, attitude,thought
or experiences are the several causes which may encourage a man to
work to get satisfaction. Thus, motivation is the cause and effect of
human satisfaction.

5.Total individual motivation: Generally, an individual is found being

motivated and satisfied as a whole. An individual is a whole. He
cannot be seperated. If a person gets wound in his hand or leg, after
medicine, he cannot say that the hand/leg is satisfied and cures, not
me, rather he feels the satisfaction as a whole.

6.Inspiration and encouragement: To motivate the people is a very

difficult task and responsibility of a manager because he is responsible
to inspire and encourage the subordinates in work in such a way that
they could perform their job in efficient way.

7.Complex and unpredictable: Motivation is not that simple, it is very

complex. No one can determine, explain and predict the behaviour of
person as the desire, drives and attitudes are changed frequently in a
varying situation and circumstances.

8.Positive and negative motivation: Motivation may be positive or

negative on the part of employer. Positive motivation is concerned
with the use of incentives like increase in salary, allowances, grant of
reward, promotion etc. Whereas, negative motivation includes forcing
people to work by holding out threats or punishment such as loss of
job, demotion, deduction of salary etc.

Process Of Motivation
process begins with needs(a kind of deficiency) and needs creates
tension. Only after the satisfaction of the needs, a person will be
relaxed from the tension. In order to fulfill needs, a person searches
for ways which may give satisfaction. Then he will begin to work
hard to earn more so that present needs could be satisfied and future
needs could be managed too.

Topic: NEED AND IMPORTANCE OF

ENTREPRENEURSHIP
77849 Explain the need and importance of Entrepreneurship Development Understand CO2 16
Programmes to foster Entrepreneurship

Key:
Importance of entrepreneurship development
programme (EDP) is to enable entrepreneurs initiating
and sustaining the process of economic development in
the following ways-
1. Creation of Employment Opportunities
Unemployment is one of the most important problems
confronting developing and underdevelopment
countries, EDP’s enable prospective entrepreneurs in
the setting up of their own units, thus enabling them to
get self employment. With the setting up of more and
more units by entrepreneurs, both on small and large
scale, numerous job opportunities are created for the
others.
Entrepreneur in this way get an opportunity to lead an
independent and honorable life and at the same time
 they enable others in getting gainful employment.
Several schemes like Nehru Rozgar Yojna, National
Rural Employment Programme (NREP), Integrated
Rural Development Programme (IRDP) etc. have been
initiated by the government, of India in this direction.
The thrust of all these schemes is to eliminate poverty
and generate gainful employment opportunities for the
unemployed. Thus entrepreneur can play an effective
role in reducing the problem of unemployment.
2. Capital Formation
It is not possible to set up an enterprise without
adequate funds. Entrepreneur as an organizer of
factors of production employs his own as well as
borrowed resources for the setting up of his
enterprise. Entrepreneur mobilizes idle savings of the
public and put them to productive use. In this way he
helps in capital formation, which is so essential for the
industrial and economic development of a country.
Various development banks like ICICI, IFCI, IDBI;
SFCs, SIDCs take initiative in promoting
entrepreneurship through assistance to various
agencies involved in EDP and by providing financial
assistance to new entrepreneurs.
3. Balanced Regional Development
Small scale units can be set up in industrially
backward and remote areas with limited financial
resources. Successful EDP’s assist in accelerating the
pace of industrialization in the backward areas and
reduce the concentration of economic power in the
hands of a few, Entrepreneurs feel like taking
advantage of the various concessions and subsidies
offered by the state and central government. Success
story of entrepreneurs set right example for others to
follow and this accelerates the pace of industrialization
in the backward areas. Setting up of more units leads
to more development of backward areas and balanced
regional development.


4. Use of Local Resources
In the absence of any initiative local resources are
likely to remain unutilized. Proper use of these
resources can result in the progress or development of
the area and that too at lower cost. Alert
entrepreneurs seize the opportunity and exploit it in
the best interests of the area and industry. Effective
EDPs can help in the proper use of local resources by
providing guidance, assistance, education and training
to the prospective entrepreneurs.
5. Improvement in per Capital Income
Entrepreneurs are always on the lookout for
opportunities. They explore and exploit the
opportunities. Entrepreneurs take lead in organizing
various factors of production by putting them into
productive use through the setting up of enterprises.
More enterprises will lead to more production,
employment and generation of wealth in the form of
goods and services. It will result in the increase in the
overall productivity and per capita income in the
country. EDPs play a positive role in the setting of
more units and thus help in generation of more
employment and income.

Topic: PHASES OF EDPS

77569 How many phases are there in EDPs? Understand CO2 2

Key:
The S-curve that overlies these three kinds of growth breaks
conveniently into four segments, which represent the four stages of
EDP growth: initiation, expansion, formalization, and maturity.

Mapping
Questions in Unit-3 Pattern Marks
COs
 Topic: AGENCIES FOR POLICY FORMULATION AND

IMPLEMENTATION
91320 List the rationale behind micro and small enterprise Evaluate CO3 2
development in the country.

Key:
Employment argument
Equality argument
Decentralization argument
Latent resource argument
92106 Discuss the support provided by Khadi and Village Understand CO3 8
Industries Commission

Key:
Khadi and Village Industries Commission (KVIC)
plans, promotes, organizes and implements programs
for the development of Khadi and other village
industries in rural areas nationwide. KVIC also helps
in building up reserve of raw materials for supply to
producers. The commission focuses in creation of
common service facilities for processing of raw
materials, such as semi-finished goods. KVIC has also
helped in creation of employment in Khadi industry.
The interest subsidy scheme offered by KVIC shall be
applicable to specific loans offered by financial
agencies. Loans raised by KVIC for disbursement as
capital investment and working capital loans are
offered by: Institutions: Registered under Societies
Registration Act 1860 Co-operative Society:
Registered under Co-operative Societies Act 1912
Charitable Trusts for public welfare and religious
purposes Financial Institutions: Scheduled and Non-
scheduled banks, Nationalised Banks, Co-operative
Banks, State Financial Corporations and Industrial
Development Banks Functions of KVIC 1. Building up
of a reserve of raw materials and implementation for
supply to producers 2. Formation of common service
facilities for processing of raw materials that include
semi-finished goods 3. Promoting the sale and
marketing of Khadi and Village Industries products,
as well as handicrafts 4. Promoting research in the
village industries sector related production
techniques and equipment 5. Providing financial
assistance to individuals and institutions for the
development and operation of Khadi and Village
industries Objectives of KVIC To promote Khadi in
rural areas To provide employment To produce
saleable articles To create self-reliance amongst the
poor To build up strong rural community
Topic: DEVELOPMENT FINANCIAL INSTITUTIONS
92040 Discuss the need for institutional support to small Evaluate CO3 16
scale industries

Key:
The government at both central and state level
established various financial institutions to provide
non-financial and financial assistances to small-scale
industries. As the small-scale industries are weak
financial structure, they require non-financial
assistances, so that, they could compete with large
scale industries. The government established various
institutions to provide non-financial assistances
exclusively to the small-scale industries. In the same
way there are institutions in addition to commercial
banks which cater to the financial requirements of
small scale industries. In this chapter an attempt has
been made to present the various institutions
involved in providing financial and non-financial
assistances to small-scale industries In the economic
development of India, a strategic position has been
given to the development of village and small
 industries (VSI) which constitute an important
segment of the overall economy. Next to agriculture,
the VSI sector provides the greatest employment
opportunities, a considerable portion of which is in
rural and semi-rural areas. It contributes about fifty
percent of the value added in manufacturing India's
overall policy on all industrial development is
contained in the Industrial Policy Resolution of 1956,
as amended from time to time. New priorities have
been developed as and when required including some
designed to reduce the basic handicaps of small-scale
industries. The latest of these is the Industrial Policy
of July 1980 which alms to harmonise growth in the
small-scale sector with that in the large and medium
sectors and to remove the dichotomies between the
two sectors. Each area comes under the overview of
one of the following organizations set up by the
Central Government: a) The Small-Scale Industries
Board b) The Khadi and Village Industries
Commission c) The All India Handicrafts Board d) The
Central Silk Board e) The Central Coir Board f) The
All India Handloom Board
92096 Evaluate the need for Industrial Estates and give an Evaluate CO3 16
account of performance and problems of Industrial
estates in India.

Key:
An industrial estate is a place where the required
facilities and factory accommodation are provided by
the government to the entrepreneurs to establish
their industries there. In India, industrial estates have
been utilised as an effective tool for the promotion
and growth of small-scale industries. They have also
been used as an effective tool to decentralise
industrial activity to rural and backward areas.
Industrial estates are also known by different names,
e.g. industrial region, industrial park, industrial area,
industrial zone, etc. Objectives of Industrial Estates:
The main objectives of the establishment of industrial
estates are to: 1. Provide infrastructure and
accommodation facilities to the entrepreneurs; 2.
Encourage the development of small-scale industries
in the country; 3. Decentralise industries to the rural
and backward areas; 4. Encourage ancillarisation in
surroundings of major industrial units; and 5. Develop
entrepreneurship by creating a congenial climate to
run the industries in these estates/area /township,
etc. Problems of Industrial Estate 1. Establishment 2.
Process of Land Acquistion 3. Land development and
construction work 4. Progress of Infrastructure work
5. Sources of Finance 6.Labor welfare.

Topic: DISTRICT INDUSTRIES CENTERS

91944 Explain the importance and functions of District Remember CO3 16
Industries Centre

Key:
The ‘District Industries Centre’ (DICs) programme
was started by the central government in 1978 with
the objective of providing a focal point for promoting
small, tiny, cottage and village industries in a
particular area and to make available to them all
necessary services and facilities at one place. The
finances for setting up DICs in a state are contributed
equally by the particular state government and the
central government. To facilitate the process of small
enterprise development, DICs have been entrusted
with most of the administrative and financial powers.
For purpose of allotment of land, work sheds, raw
materials etc., DICs functions under the ‘Directorate
of Industries’. Each DIC is headed by a General
Manager who is assisted by four functional managers
and three project managers to look after the following
 activities : Activities of District Industries Centre
(DIC): i. Economic Investigation ii. Plant and
Machinery iii. Research, education and training iv.
Raw materials v. Credit facilities vi. Marketing
assistance vii. Cottage industries Objectives of
District Industries Centre (DIC): The important
objectives of DICs are as follow : i. Accelerate the
overall efforts for industrialisation of the district. ii.
Rural industrialisation and development of rural
industries and handicrafts. iii. Attainment of
economic equality in various regions of the district.
iv. Providing the benefit of the government schemes
to the new entrepreneurs. v. Centralisation of
procedures required to start a new industrial unit and
minimisation- of the efforts and time required to
obtain various permissions, licenses, registrations,
subsidies etc. Functions of District Industries Centre
(DIC): i. Acts as the focal point of the industrialisation
of the district. ii. Prepares the industrial profile of the
district with respect to : iii. Statistics and information
about existing industrial units in the district in the
large, Medium, small as well as co-operative sectors.
iv. Opportunity guidance to entrepreneurs. v.
Compilation of information about local sources of raw
materials and their availability. vi. Manpower
assessment with respect to skilled, semi-skilled
workers. vii. Assessment of availability of
infrastructure facilities like quality testing, research
and development, transport, prototype development,
warehouse etc. viii. Organises entrepreneurship
development training programs. ix. Provides
information about various government schemes,
subsidies, grants and assistance available from the
other corporations set up for promotion of industries.
x. Gives SSI registration. xi. Prepares techno-
economic feasibility report. xii. Advices the
entrepreneurs on investments. xiii. Acts as a link
between the entrepreneurs and the lead bank of the
district. xiv. Implements government sponsored
schemes for educated unemployed people like PMRY
scheme, Jawahar Rojgar Yojana, etc. xv. Helps
entrepreneurs in obtaining licenses from the
Electricity Board, Water Supply Board, No Objection
Certificates etc. xvi. Assist the entrepreneur to
procure imported machinery and raw materials. xvii.
Organises marketing outlets in liaison with other
government agencies.

Topic: ENTREPRENEURSHIP DEVELOPMENT

INSTITUTE OF INDIA
91351 Write a short note on Industrial Estates? Remember CO3 2

Key:
An industrial estate is a place where the required
facilities and factory accommodation are provided by
the government to the entrepreneurs to establish
their industries .
93766 What is Ancillary Unit? Remember CO3 2

Key:
Ancillary unit are industrial undertakings having fixed
investment in plant and machinery not exceeding Rs.
1 crore engaged in or proposed to engage in.

92165 Critically analyze the functions of Entrepreneurship Analyze CO3 16

Development Institute of India.

Key:
The Entrepreneurship Development Institute of India
(EDI or EDII) is a non-profit organization dedicated to
promote entrepreneurship that is based in
Ahemadabad, Gujarat, India. It was founded in 1983
with the sponsorship of the Industrial Development
 Bank of India (IDBI), the Industrial Finance
Corporation of India (IFCI), the Industrial Credit and
Investment Corporation of India (ICICI) and State
Bank of India (SBI). EDI runs a range of educational
programs in the field of entrepreneurship including a
2 year Post Graduate Diploma in Management
(PGDM) program for first generation entrepreneurs,
family business inheritors, agri-business, and non-
governmental organization management. Functions of
EDII Creating a multiplier effect on opportunities for
self-employment, Augmenting the supply of
competent entrepreneurs through training,
Augmenting the supply of entrepreneur trainer-
motivators, Participating in institution building
efforts, Inculcating the spirit of 'Entrepreneurship' in
youth, Promoting micro enterprises at rural level,
Developing new knowledge and insights in
entrepreneurial theory and practice through
research, Facilitating corporate excellence through
creating intrapreneurs, Improving managerial
capabilities of small scale industries, Sensitizing the
support system to facilitate entrepreneurs establish
and manage their enterprises, Collaborating with
organizations to accomplish the above objectives.
Topic: FINANCIAL SUPPORT SYSTEM
92060 Evaluate the role of financial institutions in funding Evaluate CO3 16
entrepreneurs.

Key:
Financial sector plays an indispensable role in the
overall development of a country. The most important
constituent of this sector is the financial institutions,
which act as a conduit for the transfer of resources
from net savers to net borrowers, that is, from those
who spend less than their earnings to those who
spend more than their earnings. The financial
institutions have traditionally been the major source
of long-term funds for the economy. These institutions
provide a variety of financial products and services to
fulfil the varied needs of the commercial sector.
Besides, they provide assistance to new enterprises,
small and medium firms as well as to the industries
established in backward areas. Thus, they have
helped in reducing regional disparities by inducing
widespread industrial development. The Government
of India, in order to provide adequate supply of credit
to various sectors of the economy, has evolved a well
developed structure of financial institutions in the
country. These financial institutions can be broadly
categorised into All India institutions and State level
institutions, depending upon the geographical
coverage of their operations. At the national level,
they provide long and medium term loans at
reasonable rates of interest. They subscribe to the
debenture issues of companies, underwrite public
issue of shares, guarantee loans and deferred
payments, etc. Though, the State level institutions are
mainly concerned with the development of medium
and small scale enterprises, but they provide the
same type of financial assistance as the national level
institutions. National Level Institutions A wide variety
of financial institutions have been set up at the
national level. They cater to the diverse financial
requirements of the entrepreneurs. They include all
India development banks like IDBI, SIDBI, IFCI Ltd,
IIBI; specialised financial institutions like IVCF, ICICI
Venture Funds Ltd, TFCI ; investment institutions like
LIC, GIC, UTI; etc. All-India Development Banks
(AIDBs):- Includes those development banks which
provide institutional credit to not only large and
medium enterprises but also help in promotion and
development of small scale industrial units. Industrial
Development Bank of India (IDBI):- was established in
 July 1964 as an apex financial institution for
industrial development in the country. It caters to the
diversified needs of medium and large scale
industries in the form of financial assistance, both
direct and indirect. Direct assistance is provided by
way of project loans, underwriting of and direct
subscription to industrial securities, soft loans,
technical refund loans, etc. While, indirect assistance
is in the form of refinance facilities to industrial
concerns. Industrial Finance Corporation of India Ltd
(IFCI Ltd):- was the first development finance
institution set up in 1948 under the IFCI Act in order
to pioneer long-term institutional credit to medium
and large industries. It aims to provide financial
assistance to industry by way of rupee and foreign
currency loans, underwrites/subscribes the issue of
stocks, shares, bonds and debentures of industrial
concerns, etc. It has also diversified its activities in
the field of merchant banking, syndication of loans,
formulation of rehabilitation programmes,
assignments relating to amalgamations and mergers,
etc. Small Industries Development Bank of India
(SIDBI):- was set up by the Government of India in
April 1990, as a wholly owned subsidiary of IDBI. It is
the principal financial institution for promotion,
financing and development of small scale industries
in the economy. It aims to empower the Micro, Small
and Medium Enterprises (MSME) sector with a view
to contributing to the process of economic growth,
employment generation and balanced regional
development. Industrial Investment Bank of India Ltd
(IIBI):- was set up in 1985 under the Industrial
reconstruction Bank of India Act, 1984, as the
principal credit and reconstruction agency for sick
industrial units. It was converted into IIBI on March
17, 1997, as a full-fledged development financial
institution. It assists industry mainly in medium and
large sector through wide ranging products and
services. Besides project finance, IIBI also provides
short duration non-project asset-backed financing in
the form of underwriting/direct subscription, deferred
payment guarantees and working capital/other short-
term loans to companies to meet their fund
requirements.

Topic: FORMS OF FINANCIAL SUPPORT

91336 What is the short term source of Finance? Understand CO3 2

Key:
There are a number of sources of short-term finance:
(i) Trade Credit, (2) Bank credit including loans and
advances, cash credit, overdraft and discounting of
bills, (3) Customers' advances, (4) installment credit,
and (5) Loans from co-operative banks

91991 Explain the various sources of financial support by Remember CO3 16

the Government for Entrepreneurs

Key:
An entrepreneur requires a continuous flow of funds
not only for setting up of his/ her business, but also
for successful operation as well as regular
upgradation/ modernisation of the industrial unit. To
meet this requirement, the Government (both at the
Central and State level) has been undertaking several
steps like setting up of banks and financial
institutions; formulating various policies and
schemes, etc. All such measures are specifically
focussed towards the promotion and development of
small and medium enterprises. The public sector
banks are the major source of financial assistance to
the industrial sector. They extend credit support to
the firms in the form of loans, advances, discounting
bills, project financing, term loans, export finance,
etc. Some of the major examples of such banks are:-
State Bank of India (SBI) provides a wide range of
financial products and services that can cater to any
business or market requirement. It deploys multiple
channels to deliver integrated solutions for all
financial challenges faced by the corporate universe.
Its various funding schemes are:- Working capital
finance, extended to all segments of industries and
services sector. Corporate term loans to support
capital expenditures for setting up new ventures as
also for expansion, renovation, etc. Deferred payment
guarantees to support purchase of capital
equipments. Project finance Structured Finance The
bank also provides financial assistance to
agriculturists through a network of rural and semi-
urban branches. These specialized branches have
been set up in different parts of the country
exclusively for the development of agriculture
through credit deployment. Their schemes cover a
wide range of agricultural activities like crop loan,
finance to horticulture, farm mechanization schemes,
land development schemes, minor irrigation projects,
agricultural term loans, etc. Bank of Baroda offers
various products and services that meet the specific
requirements of business enterprises, particularly the
small scale units. Various schemes relating to the
provision of loans and advances by the bank include:-
Working Capital Finance Term Finance Small and
Medium Enterprise (SME) Loan Pack Small Business
Borrowers Traders Loan Andhra Bank has also
devised a host of loan schemes to meet the financial
requirements of an enterprise. These particularly
cater to the corporate and agricultural sector. Some
of its important funding options include:- Working
Capital Loans Export & Import Finance Advance
against Shares Term Finance Corporate Loans
Project Finance Infrastructure Project Finance Kisan
Vikas Card Kisan Sampathi Self Help Groups-Bank
Linkage Programme Kisan Green Card Small scale
industries need credit support on a continuous basis
for running the enterprise as well as for its
diversification and modernization. Recognizing the
need for a focused financial assistance to such
industries, the Government of India, together with the
State Governments, has formulated several policy
packages including schemes and funds for their
growth and development. Most of these programmes
of the Central Government are implemented through
two principal organizations:- Small Industries
Development Organisation (SIDO) is an apex body for
promotion and development of small scale industries
in the country. Its major activities include:- Advising
the Government on formulation of policies and
programmes for the small-scale industries.
Conducting periodical census/survey of the small
scale industry and generating data/reports on various
important parameters/indicators of growth and
development of the sector. Maintaining close liaison
with other Central Ministries, Planning Commission,
State Governments, Financial Institutions and other
organisations concerned with the development of
small-scale industries. Facilitating linkage of small-
scale industries as ancillaries to large and medium
scale industries. Developing human resource base
through training and skill upgradation. For achieving
its objectives, SIDO has devised a comprehensive
range of schemes for providing credit facilities,
technology support services and marketing
assistance, etc. Some of the major schemes are:-
Credit Linked Capital Subsidy Scheme for Technology
Upgradation Credit Guarantee Scheme ISO 9000/ISO
14001 Certification Reimbursement Scheme
Integrated Infrastructure Development (IID Scheme)
SSI MDA Scheme Assistance to Entrepreneurship
Development Institutes Micro Finance Programme
 National Small Industries Corporation Ltd (NSIC),
has been established with the objective of promoting,
aiding and fostering the growth of small scale
industries in the country. It has been assisting small
enterprises through a set of specially tailored
schemes which facilitate marketing support, credit
support, technology support and other support
services. Marketing support schemes :- sound
marketing is critical for the growth and survival of
small enterprises. NSIC acts as a facilitator to
promote small industries products and has devised a
number of schemes to support small enterprises in
their marketing. Credit support schemes:- NSIC
facilitates credit requirements of small enterprises in
several areas. These include:- Equipment financing:-
through schemes like 'Hire Purchase' and 'Term Loan'
for the procurement of equipments. Financing for
procurement of raw material:- by facilitating bulk
purchase of basic raw materials at competitive rates,
import of scares raw materials,etc. NSIC also takes
care of all the procedures, documentation and issue
of letter of credit in case of imports. Financing for
marketing activities:- such as internal marketing,
exports and bill discounting, etc. Financing through
syndication with banks:- by entering into strategic
alliances with commercial banks so as to facilitate
fund requirement of the small enterprises. It involves
an arrangement of forwarding the loan applications of
the interested small enterprises to the banks.
Performance and credit rating scheme for small
industries:- so as to enable the small enterprises to
ascertain the strengths and weaknesses of their
existing operations and take corrective measures
accordingly. NSIC is operating the scheme through
agencies like ICRA, ONICRA, Duns &
Bradstreet(D&B), CRISIL, FITCH, CARE and SMERA.
Technology support schemes:- NSIC offers small units
various support services through its 'Technical
Services Centres' and 'Extension Centres'. The
services provided include advise on application of
new techniques; material testing facilities through
accredited laboratories; energy and environment
services at selected centres; classroom and practical
training for skill upgradation, etc.

Topic: LONG TERM AND SHORT TERM FINANCIAL

SUPPORT
92047 Examine the various types of government grants and Remember CO3 16
financial incentives available for new enterprises.

Key:
The government of India has made several
administrative changes to help setting up factories
and Industrial units in India easy for foreign investors
and NRIs returning to India to set up businesses. The
Indian Government has set up the Foreign Investment
Promotion Board (FIPB) to promote foreign
investment in India. The purpose of this board is to
promote foreign investment in India as well as
providing a single window facility for all matters
related to foreign investment in India. The need to go
from one department to the other for clearances in
setting up business in India is to some extend
eliminated by single window clearance facility. The
Government of India has been supplementing the
efforts of State Governments for accelerating the
industrial development of backward areas and special
category states through various policies and packages
of incentives. Those planning to set up industry or
contemplating investing in India will find more
information regarding investing in India from the
Ministry of commerce and industry STATE
GOVERNMENTS INCENTIVES FOR INVESTORS
Many state governments are offering incentives to
 attract investment in their states. Many state
governments in India offer attractive incentive
packages which include incentives such as: • Land at
subsidized prices or Industrial sheds to set up small
scale industrial units • Tax concessions for a number
of years. These may include exemption from sales tax
etc for a set period of time • Electric power supply at
a reduced tariff • Loans and subsidies at very
attractive rates of interest INCENTIVES FOR
SETTING UP BUSINESS IN BACKWARD AREAS The
Government of India as well as several State
Governments provide several benefits and incentives
to promote industrialization of backward areas. Both
the central and state governments share the cost of
some of the incentives provided. The purpose of such
incentives is to develop backward areas and increase
employment for local inhabitants of such areas. The
bulk of new industries prefer areas with an
established infrastructure and this is why incentives
are offered to entice new ventures to start up in areas
that need development. Incentives offered depend on
the specific area chosen. Some of the incentives
offered are: • Transportation subsidies to promote
industries in areas that are not easily accessible, like
remote hilly areas. A subsidy of 50% to 90% on
transportation costs is available under this scheme. •
A Subsidy at the rate of 15% of the investment
amount in plant and machinery is given under the
capital investment subsidy scheme. • A subsidy for
interest relief is also provided at a rate of 3% for new
industrial units in some areas. While in the past
setting up an industry in India was not an easy task
because of bureaucratic requirements that needed to
be fulfilled. However both the central and state
governments have now made efforts to improve some
things.

Topic: MSME POLICY IN INDIA

91257 What is Medium Enterprise? Understand CO3 2

Key:
A medium enterprise is an enterprise where the
investment in plant and machinery (original cost
excluding land and building and the items specified
by the Ministry of Small Scale Industries is more than
Rs. 5 crore but does not exceed Rs. 10 crore.
91291 What are the problems faced by Micro and small Understand CO3 2
enterprises?

Key:
Problems in procuring raw materials due to scarcity,
poor quality and high cost. Problems of finance due to
weak economic base, poor financial assistance from
commercial banks and financial institutions. Problem
of marketing by comparing products unfavorably with
the quality of products of large scale industries
Problem of under-utilization of capacity because of
poor power supply, cannot afford to go for
alternatives like large-scale industries.
91438 What is Small Scale Industries? Remember CO3 2

Key:
Essentially small scale industries comprise of small
enterprises who manufacture goods or services with
the help of relatively smaller machines and a few
workers and employees For Manufacturing Units for
Goods: Investment in plant and machinery must be
between 25 lakhs and five crores. For Service
Providers: Investment in machinery must be between
10 lakhs and two crores.

91447 Describe the role of Small scale industries in the Understand CO3 2
 Indian Economy?

Key:
Small scale industries are important because it helps
in increasing employment and economic development
of India. It improves the growth of the country by
increasing urban and rural growth
91449 What do you understand by MSME? Remember CO3 2

Key:
The Micro Small & Medium Enterprises (MSMEs) are
defined in India under the MSMED Act 2006 on the
basis of capital investment made in plant and
machinery, excluding investments in land and
building.
92021 Give a detailed account on the MSME Policy of India. Remember CO3 8

Key:

MSME stands for Micro, Small and Medium
Enterprises. These industries or enterprises form the
backbone of our economy and need assistance and
protection from other big companies as they lack in
resources and technology. To do this the government
provides some schemes, rebates or counseling to
these enterprises.

The MSMEs of India would be the cradle for the
“Make in India” vision. This would be the nursery
where small existing businesses have the
potential to become world beaters tomorrow. The
larger players amongst the MSME space also are in a
unique position to become global players attracting
partners with technology and funds.

Manufacturing or the Production Sector
MICRO – Investment is less than or equal to Rs. 25
lakhs
SMALL – Investment is to be more than 25 lakhs but
limited to Rs. 5 crore
MEDIUM – Investment is more than 5 crore but less
than 10 crores.

Service Sector
MICRO – Investment in equipment does not exceed
Rs. 10 Lakhs
SMALL – Investment in equipment is more than 10
Lakhs but limited to Rs. 2 Crore
MEDIUM – Investment in equipment is more than 2
Crore but less than 5 Crore.

Policy Framework should at once be:
1. An enabling framework
2. A supporting framework, and
3. For very small businesses) Subsidy Framework.

Topic: NATIONAL ENTREPRENEURSHIP

DEVELOPMENT BOARD
91306 Critically analyze the types of Small Scale Industries. Analyze CO3 2

Key:
Manufacturing industry
'Cottage industry
Village industry
Ancillary industry
Service industry Mining and Quarrying Feeder
industry
Topic: NATIONAL INSTITUTE OF ENTREPRENEURSHIP

AND SMALL BUSINESS DEVELOPMENT
92172 Give a detailed account on National Institute of Remember CO3 16
 Entrepreneurship and Small Business Development
(NIESBUD).

Key:
The National Institute for Entrepreneurship and
Small Business Development is a premier
organization of the Ministry of Skill Development and
Entrepreneurship, engaged in training, consultancy,
research, etc. in order to promote entrepreneurship
and Skill Development. The major activities of the
Institute include Training of Trainers, Management
Development Programmes, Entrepreneurship-cum-
Skill Development Programmes, Entrepreneurship
Development Programmes and Cluster Intervention.
Established in 1983 by the then Ministry of Industry
[now Ministry of Micro, Small & Medium Enterprises
(MSMEs)], Government of India An apex body for
coordinating and overseeing the activities of various
institutions/agencies engaged in Entrepreneurship
Development In the area of small industry and small
business. This Institute is registered as a Society
under Societies Registration Act, 1860 (XXI of 1860),
started functioning from 6th July, 1983 Objectives-
NIESBUD a) To evolve standardized materials and
processes for selection, training, support and
sustenance of entrepreneurs, potential and existing.
b) To help/support and affiliate
institutions/organizations in carrying out training and
other entrepreneurship development related
activities. c) To serve as an apex national level
resource institute for accelerating the process of
entrepreneurship development ensuring its impact
across the country and among all strata of the
society. d) To provide vital information and support to
trainers, promoters and entrepreneurs by organizing
research and documentation relevant to
entrepreneurship development e) To train trainers,
promoters and consultants in various areas of
entrepreneurship development. f) To provide
national/international forums for interaction and
exchange of experiences helpful for policy
formulation and modification at various levels. g) To
offer consultancy nationally/internationally for
promotion of entrepreneurship and small business
development. h) To share internationally, the
experience and expertise in entrepreneurship
development

Topic: ROLE OF GOVERNMENT IN PROMOTING

ENTREPRENEURSHIP
90958 Define the role of government in promoting Remember CO3 2
Entrepreneurship?

Key:
To develop and nurture the entrepreneurial sector,
the support of the government is crucial. The MSMED
Act was passed in 2006, which aims at providing
guidelines for skill development of employees,
management and entrepreneurs in addition to
resolving many other issues.
191629 Explain the role of government in supporting entrepreneurship in Understand CO3 16
India.

Key:
Small and Medium-sized Enterprises (SMEs) in market economies
are the engine of economic development. Owing to their private
ownership, entrepreneurial spirit, their flexibility and adaptability as
well as their potential to react to challenges and changing
environments, SMEs contribute to sustainable growth and
employment generation in a significant manner.
The following are the support extend by the government in
promoting entrepreneurship in India

Training - Basic training differs from product to product but

will necessary involve sharpening of entrepreneurial skills.
Need based technical training is provided by the Govt. & State
Govt. technical Institutions. There are a number of
Government organisations as well as NGOs who conduct
EDPs and MDPs. These EDPs and MDPs and are conducted
by MSME's, NIESBUD, NSIC, IIE, NISIET,
Entrepreneurship Development Institutes and other state
government developmental agencies.
Marketing Assistance - There are Governmental and non-
governmental specialised agencies which provide marketing
assistance. Besides promotion of MSME products through
exhibitions, NSIC directly market the MSME produce in the
domestic and overseas market. NSIC also manages a single
point registration scheme for manufacturers for Govt.
purchase. Units registered under this scheme get the benefits
of free tender documents and exemption from earnest money
deposit and performance guarantee.
Promotional Schemes - Government accords the highest
preference to development of MSME by framing and
implementing suitable policies and promotional schemes.
Besides providing developed land and sheds to the
entrepreneurs on actual cost basis with appropriate
infrastructure, special schemes have been designed for
specific purposes like quality upgradation, common facilities,
entrepreneurship development and consultancy services at
nominal charges. Government of India has been executing the
incentive scheme for providing reimbursement of charges for
acquiring ISO 9000 certification to the extent of 75% of the
cost subject to a maximum of Rs. 75,000/- in each case. ISO
9000 is a mechanism to facilitate adoption of consistent
management practices and production technique as decided by
the entrepreneur himself. This facilitates achievement of
desired level of quality while keeping check on production
process and management of the enterprise.
Concession on Excise Duty - MSME units with a turnover of
Rs. 1 crore or less per year have been exempted from payment
of Excise Duty. Moreover there is a general scheme of excise
exemption for MSME brought out by the Ministry of Finance
which covers most of the items. Under this, units having
turnover of less than Rs. 3 crores are eligible for concessional
rate of Excise Duty. Moreover, there is an exemption from
Excise Duty for MSME units producing branded goods in
rural areas.
Credit Facility to MSME - Credit to micro, small and medium
scale sector has been covered under priority sector lending by
banks. Small Industries Development Bank of India (SIDBI)
has been established as the apex institution for financing the
MSME. Specific schemes have been designed for
implementation through SIDBI, SFCs, Scheduled Banks,
SIDCs and NSIC etc. Loans upto Rs. 5 lakhs are made
available by the banks without insisting on collaterals. Further
Credit Guarantee Fund for micro, small and medium
enterprises has been set up to provide guarantee for loans to
MSME up to Rs. 25 lakhs extended by Commercial Banks
and some Regional Rural Bank.
Incentives for Setting Up Business in Backward Areas - The
Government of India as well as several State Governments
provides several benefits and incentives to promote
industrialization of backward areas.

Some of the incentives offered are:

Transportation subsidies to promote industries in areas

that are not easily accessible, like remote hilly areas. A
subsidy of 50% to 90% on transportation costs is
available under this scheme.
A Subsidy at the rate of 15% of the investment amount
in plant and machinery is given under the capital
investment subsidy scheme.
A subsidy for interest relief is also provided at a rate of
3% for new industrial units in some areas.
Land at subsidized prices or Industrial sheds to set up
small scale industrial units.
Tax concessions for a number of years. These may
include exemption from sales tax etc for a set period of
 time.
Electric power supply at a reduced tariff.
Loans and subsidies at very attractive rates of interest.

Topic: SMALL INDUSTRIES SERVICES INSTITUTE

91270 What are the main functions of SISI? Remember CO3 2

Key:
To serve as interface between central and state
governments To render technical support services To
conduct Entrepreneurship Development Programmes
To initiate promotional programs.

Mapping
Questions in Unit-4 Pattern Marks
COs
Topic: CONCEPT OF SOCIAL ENTERPRISE
93556 What does it mean to be a social enterprise? Remember CO4 2

Key:
A social enterprise is a commercial organization that
has specific social objectives that serve its primary
purpose. Social enterprises seek to maximize profits
while maximizing benefits to society and the
environment.
93558 What are the main objectives of a social enterprise? Remember CO4 2

Key:
A social enterprise is a business that aims to achieve
a particular public or community mission (social,
environmental, cultural or economic), and reinvests
the majority of its profits into achieving that mission.
Topic: DEVELOPING WOMEN ENTREPRENEURS IN

INDIA
94433 What is the support provided by Government of India Remember CO4 16
for the women entrepreneurs? Explain in brief.

Key:
Women Entrepreneurs can be seen everywhere in the
startup-up ecosystem of India. Women too are seen
leaving their high-profile jobs as well as some
stepping out of the four walls of their homes and
joining the pool of Entrepreneurship in India. The
major factor to jumpstart the entrepreneurial journey
is capital and various banks offer specialized loans for
women entrepreneurs that have slightly different and
more flexible set of terms and conditions pertaining
to collateral security, interest rates, etc. Here is a list
of various schemes and loans exclusively for women
that aim at promoting and easing out the process for
them – 1. Annapurna Scheme This scheme is offered
by the State Bank of Mysore for those women
entrepreneurs who are setting up food catering
industry in order to sell packed meals, snacks, etc.
The amount granted as a loan under this scheme can
be used to fulfill the working capital needs of the
business like buying utensils and other kitchen tools
and equipment. Under this loan, a guarantor is
required along with the assets of the business being
pledged as collateral security. Further, the maximum
amount of money that is granted is ₹50,000 which has
to re-paid in monthly installments for 36 months,
however, after the loan is sanctioned, the lender
doesn’t have to pay the EMI for the first month. The
interest rate is determined depending upon the
market rate. 2. Stree Shakti Package For Women
Entrepreneurs This scheme is offered by most of the
SBI branches to women who have 50% share in the
ownership of a firm or business and have taken part
in the state agencies run Entrepreneurship
Development Programmes (EDP). The scheme also
offers a discounted rate of interest by 0.50% in case
the amount of loan is more than ₹2 lakhs. 3.
Bharatiya Mahila Bank Business Loan This loan is a
support system for budding women entrepreneurs
looking to start new ventures in the fields of the retail
sector, loan against property, MICRO loans, and SME
loans. The maximum loan amount under this loan
goes up to ₹20 crores in case of manufacturing
industries and also a concession is available to the
extent of 0.25% on the interest rate and interest rates
usually range from 10.15% and higher. Additionally,
under the Credit Guarantee Fund Trust for Micro and
Small Enterprises (CGTMSE), there is no requirement
of collateral security for a loan of up to ₹1 crore. 4.
Dena Shakti Scheme This scheme is provided by Dena
bank to those women entrepreneurs in the fields of
agriculture, manufacturing, micro-credit, retail
stores, or small enterprises; who are in need of
financial assistance. The interest rate is also
decreased by 0.25% along with the maximum loan
amount being ₹20 lakhs for retail trade; education
and housing whereas ₹50,000 under the microcredit.
5. Udyogini Scheme This scheme is offered by Punjab
and Sind Bank so as to provide women entrepreneurs
involved in Agriculture, retail and small business
enterprises to get loans for business at flexible terms
and concessional interest rates. The maximum
amount of loan under this scheme for women
between the age bracket of 18-45 years is ₹1 lakhs
but your family income is also taken into
consideration and is set at ₹45,000 per annum for
SC/ST women. 6. Cent Kalyani Scheme Ths scheme is
offered by the Central Bank of India with the aim of
supporting women in starting a new venture or
expanding or modifying an existing enterprise. This
loan can be availed by women who are involved in
village and cottage industries, micro, small and
medium enterprises, self-employed women,
agriculture and allied activities, retail trade, and
government-sponsored programs. This scheme
requires no collateral security or guarantor and
charges no processing fees. And the maximum
amount that can be granted under the scheme is Rs.
100 lakhs. 7. Mahila Udyam Nidhi Scheme This
scheme is launched by Punjab National Bank and
aims at supporting the women entrepreneurs involved
in the small scale industries by granting them soft
loans that can be repaid over a period of 10 years.
Under this scheme there are different plans for
beauty parlors, day care centres, purchase of auto
rickshaws, two-wheelers, cars, etc. the maximum
amount granted under this scheme is ₹10 lakhs and
the interest depends upon the market rates. 8. Mudra
Yojana Scheme For Women This scheme has been
launched by the Govt. of India for individual women
wanting to start small new enterprises and businesses
like beauty parlors, tailoring units, tuition centres,
etc. as well as a group of women wanting to start a
venture together. The loan doesn’t require any
collateral security and can be availed as per 3
schemes – i. Shishu – loan amount is limited to
₹50,000 and can be availed by those businesses that
are in their initial stages. ii. Kishor – loan amount
ranges between ₹50,000 and ₹5 lakhs and can be
availed by those who have a well-established
enterprise. iii. Tarun – loan amount is ₹10 lakhs and
can be availed by those businesses that are well
established but require further funds for the purpose
of expansion If the loan is granted, a Mudra card will
be given to you which functions the same way as a
credit card however the funds available are limited to
10% of the loan amount granted to you. 9. Orient
Mahila Vikas Yojana Scheme This scheme is provided
by Oriental Bank of Commerce to those women who
hold a 51% share capital individually or jointly in a
 proprietary concern. No collateral security is
required for loans of ₹10 lakhs up to ₹25 lakhs in
case of small-scale industries and the period of
repayment is 7 years. A concession on the interest
rate of up to 2% is given. 4. Critically analyze the
concept of Social Entrepreneurship. A Social
Entrepreneurship is an organization which uses
business methods to address a social or
environmental problem in an innovative way. Social
entrepreneurs are individuals with innovative
solutions to society’s most pressing social problems.
They are persistent and ambitious, tackle major social
issues and offer new ideas for a wide-scale change.‘
Usually, people leave the societal needs to the
government or the business sectors. However, social
entrepreneurs tend to identify areas that are not
working efficiently in the current system and solve
the problem by changing it, spreading the awareness
about the solution, and persuading people to be a
part of the change. As a common trait, social
entrepreneurs are obsessed with their ideas and
commit their lives to change. They are visionaries
since they envision a society without the problems.
Further, they are realists, since they concern
themselves with the practical implementation of their
vision. They also present ideas which are user-
friendly, ethical, and easily understandable and
engage widespread support. This ensures that local
people stand up, grab their idea and implement it. In
simple words, every leading social entrepreneur is a
mass recruiter of local change makers. He is a role
model who tells people that their action can do
anything. In the last two decades, social
entrepreneurship has grown based on the
understanding that a new idea in the hands of a good
entrepreneur is a powerful tool. Social
entrepreneurship is, at its most basic level, doing
business for a social cause. It might also be referred
to as altruistic entrepreneurship. They don't measure
their success in terms of profit alone – success to
social entrepreneurs means that they have improved
the world, however they define that

Topic: ESSENTIALS TO AVOID UNSUCCESSFUL

ENTREPRENEURSHIP
94812 Kapishan unemployed graduate got training for Apply CO4 16
automobile repairing and allied services under
PMKVY (Pradhan Mantri Kaushal Vikas Yojana) for
skill development. He is planning to start a digital
workshop for which he needs 25 lacs. Though
through MUDRA (Micro Units Development and
Refinance Agency)he is able to get a loan of 10 lacs
but still he is falling short of 15 lacs. He wants to
pitch in his idea to potential investors through his
business plan. Explain the different formats in which
he can present his business plan for his start-up

Key:
It is common, especially for start-ups ,to have four
formats as follows for the same business plan’s)
Elevator pitch: It is a three minute summary of the
business plan's executive summary. This is often used
as a teaser to awaken the interest of potential
funders, customers, or strategic partnership) A pitch
deck with oral narrative : A hopeful, entertaining
slide show and oral narrative that is meant to trigger
discussion and interest of potential investors in
reading the written presentation, i.e. the executive
summary and a few key graphs showing financial
trends and key decision making benchmark.iii) A
written presentation for external stakeholders: A
detailed, well written, and pleasingly formatted plan
targeted at external stakeholders.iv) An internal
 operational plan: A detailed plan describing planning
details that are needed by management but may not
be of interest to external stakeholders.
Topic: FAMILY BUSINESS ENTREPRENEURSHIP
93524 What is a family business in entrepreneurship? Understand CO4 2

Key:
A business actively owned and/or managed by more
than one member of the same family. If you own a
family business, you probably worry even more than
the average entrepreneur about ensuring that your
company not only survives, but also thrives to nurture
the next generation.
93595 Critically analyze the challenges faced by the family Analyze CO4 2
business in India?

Key:
Family problems. Informal culture and structure
Pressure to hire family members Lack of training.
High turnover of non-family employee
93649 What is the contribution of family business in the Understand CO4 2
growth of Indian economy?

Key:
Family businesses are the backbone of the Indian
economy. being one of the fastest growing economies
of the world and GDP growing almost at 7%, the
business environment is changing at a very rapid
pace and in order to survive and thrive family run
businesses face new challenges within the family and
outside.
94581 Explain the challenges involved in Family business. Remember CO4 16

Key:
Emotions. Family problems will affect the business.
Divorce, separations, health or financial problems
also create difficult political situations for the family
members. Informality. Absence of clear policies and
business norms for family members Tunnel vision.
Lack of outside opinions and diversity on how to
operate the business. Lack of written strategy. No
documented plan or long term planning.
Compensation problems for family members.
Dividends, salaries, benefits and compensation for
non-participating family members are not clearly
defined and justified. Role confusion. Roles and
responsibilities must be clearly defined. Lack of
talent. Hiring family members who are not qualified
or lack the skills and abilities for the organization.
Inability to fire them when it is clear they are not
working out. High turnover of non-family members.
When employees feel that the family “mafia” will
always advance over outsiders and when employees
realize that management is incompetent. Succession
Planning. Most family organizations do not have a
plan for handing the power to the next generation,
leading to great political conflicts and divisions.
Retirement and estate planning. Long term planning
to cover the necessities and realities of older
members when they leave the company. Training.
There should be a specific training program when you
integrate family members into the company. This
should provide specific information that related to the
goals, expectations and obligations of the position.
Paternalistic. Control is centralized and influenced by
tradition instead of good management practices.
Overly Conservative. Older family members try to
preserve the status quo and resist change. Especially
resistance to ideas and change proposed by the
younger generation. Communication problems.
Provoked by role confusion, emotions (envy, fear,
 anger), political divisions or other relationship
problems. Systematic thinking. Decisions are made
day-to-day in response to problems. No long-term
planning or strategic planning. Exit strategy. No clear
plan on how to sell, close or walk away from the
business. Business valuation. No knowledge of the
worth of the business, and the factors that make it
valuable or decrease its value. Growth. Problems due
to lack of capital and new investment or resistance to
re-investment in the business. Vision. Each family
member has a different vision of the business and
different goals. Control of operations. Difficult to
control other members of the family. Lack of
participation in the day-to-day work and supervision
required.
Topic: PROBLEMS OF WOMEN ENTREPRENEURSHIP IN

INDIA
94420 Explain the problems faced by women Entrepreneurs Remember CO4 16
in India.

Key:
Problem of Finance:
Finance is regarded as “life-blood” for any enterprise,
be it big or small.
Scarcity of Raw Material:
Stiff Competition Limited Mobility:
Family Ties:
Lack of Education:
Male-Dominated Society
Low Risk-Bearing Ability

Topic: REASONS FOR ENTREPRENEURIAL FAILURE

94648 Critially analyze the reasons for failure of Analyze CO4 8

Entrepreneurship in India.

Key:
Entrepreneurial success is not the result of a single
person’s efforts. There is always a team involved. The
team is made up of other investors, working partners,
employees, vendors, and clients. All play an important
part in the success of the enterprise. Although other
people are involved, there is a tendency to believe
that they play far less important roles and are easily
replaced. At the end of the day, success or failure of
the enterprise will be largely attributed to the
entrepreneur. 1. Lack of Experienced Management:
One of the main problems faced by new enterprises is
that the management team is usually very new to this
role. The entrepreneur and his/her top management
usually have no prior record of being in charge of the
fortunes of a whole company. 2. Few Trained or
Experienced Manpower: Shortage of skilled and
experienced manpower is faced by new ventures,
which represent a riskier job opportunity. Most
people prefer to work with a well-established
organization employing hundreds of employees and
having a stable track record. 3. Poor Financial
Management: Operational issues keep an
entrepreneur busy and as a result, financial manage​‐
ment is likely to get neglected. Often, the
entrepreneur may find the technicalities of
accounting and finance intimidating and avoid
looking deep into it. Common errors in financial
management can be bad receivables management,
unproduc​tive investments, and poor budgeting
decisions. 4. Rapid Growth: Sudden unplanned
growth is not always a desirable situation. Higher
growth will mean greater stress on production
facilities, manpower, and marketing channels.
Sometimes, these will not be designed to cater to the
rise in volumes and might need further capital
investments. It will lead to a stage of continuous fire-
fighting and ultimately, many things may not keep
 pace with the growth. Most commonly, the
organization may run out of money. 5. Lack of
Business Linkages: Existing working relationships
with vendors, customers, and others is a huge
advantage to established businesses. A new venture
will have to forge new relationships and work hard at
strengthening them before coming to an equal footing
with the entrenched players. Such business linkages
help in smooth conduct of business and are invaluable
at times of distress. 6. Weak Marketing Efforts:
Entrepreneurial firms are very reluctant to spend on
marketing efforts. Investing in a marketing campaign
is not going to give you assured returns and the link
between the marketing expenditure and the sales is
not very easy to establish. An investment of Rs. X in
raw material will give you a very tangible Y kg of
output but a similar investment of Rs. X in a
newspaper insert will not give you a sale of Y units,
which you can demonstratively tie into the newspaper
insert.
94694 Discuss the reasons for the failure of a new Remember CO4 16
enterprise.

Key:
Lack of Planning Entrepreneurs often start small
businesses centered on a product or service they
know and love, and many brush off advice to write a
detailed business plan, figuring their enthusiasm and
creativity are the most important prerequisites. But
business plans aren’t like classroom busy work. A
business plan helps entrepreneurs understand the
market, where they fit in, how they compete and how
many customers they need to succeed. Business plans
spell out the relationships between operating
expenses, prices and profits, all essential information
for an entrepreneur. Small businesses fail because
owners don’t put the time and research into a
business plan meant to keep them from making fatal
mistakes. Insufficient Funding Undercapitalization is
the official term, but Jay Goltz, a small-business
owner, public speaker and writer for "The New York
Times," has simpler words for another top reason why
small businesses fail: no cash cushion. As Goltz points
out, the economy works in cycles, with highs and
lows. And every entrepreneur faces unexpected
problems and unanticipated expenses. The amount of
money each owner should keep on hand varies from
business to business, but 20 percent of a startup
budget seems to be an accepted minimum starting
point. Overreaching Growing too big, too fast is
another common reason for small business failures.
New businesses can attract a lot of attention, and
owners may suddenly find new invitations and
opportunities for their products and services. Some
owners jump at every chance to expand sales without
putting the right types of management and quality
controls in place. And some entrepreneurs invest all
of their working capital in expansion without
researching new ideas and markets. Those types of
moves put a young brand at risk. Most successful
small businesses grow at a slow and steady pace.
Personal Spending When new owners are working 18
hours a day, the line between their businesses and
personal lives is sometimes blurred. Entrepreneurs
sometimes see their business revenues as personal
cash reserves. Failure to keep business and personal
finances straight, and separate, can lead to
heartache, liquidation and some very difficult tax
challenges. Business advisers call it poor financial
management, bad math or inadequate accounting,
but a root cause of small business failure often boils
down to spending business income and funds on
personal needs.
 Topic: RURAL ENTREPRENEURSHIP
93764 What is meant by village industry? Remember CO4 2

Key:
The Khadi and Village Industries Commission defined
village. industries as "any industry located in a rural
area which produce. any goods or renders any service
with or without the use of power
94479 Define Rural Entrepreneurship. Remember CO4 2

Key:
Rural entrepreneurship is defined as
entrepreneurship whose roots lie in the rural areas
but has a lot of potential to drive various endeavours
in business, industry, agriculture, etc. and contribute
to the economic development of the country. India is
a country of villages. Nearly 70% of its major
population reside in villages and their livelihood is
supported by agriculture and allied activities

94483 List out the types of Rural industries. Remember CO4 2

Key:
All the village industries come under the following
broad categories : Agro Based Industries: like sugar
industries, jaggery, oil processing from oil seeds,
pickles, fruit juice, spices, diary products etc. Forest
Based Industries: like wood products, bamboo
products, honey, coir industry, making eating plates
from leaves. Mineral based industry: like stone
crushing, cement industries, red oxide making, wall
coating powders etc. Textile Industry: like spinning,
weaving, colouring, bleaching. Engineering and
Services: like agriculture equipments, tractors and
pumpsets repairs etc.
94388 Evaluate the opportunities for Rural Entrepreneurs. Evaluate CO4 16

Key:
Rural entrepreneurship is defined in broader sense
“as the enthusiastic willingness of a villager to
organize his or her economics activity, whatever it
may be (a business, a job, an investment etc) with the
help of appropriate technology and practices
conceived for a sustainable living.” Rural
entrepreneurship has an important role to play in the
development of Indian economy. Taking into account
the fact that nearly 70 percent of the Indian
population calls rural India it’s home, adequate
funding and support can provide a thriving
entrepreneur atmosphere in these communities . So
far as it is known that rural India as compared to the
mainstream population is economically poor, younger,
more isolated geographically, isolated from the main
markets, culturally imbedded in tradition, less
dynamic economically and experiencing depopulation.
Opportunities of Rural Entrepreneurship: Support
&Motivation to local people: Rural entrepreneurs
have a lot of support from the Rural people. Rural
village people always encourage and give the
motivation to the entrepreneurs. Low establishment
cost: When compared to the urban areas, rural
entrepreneurs’ business establishment cost is very
low. There is no need to construct or facilities huge
infrastructure and buildings. Competitive advantages
/ Availability of labour: In India seventy percent of the
people are living in the village. Majority of the rural
people are depending on the agriculture. The
agriculture work is not available throughout the year.
That is the reason why rural entrepreneurs have the
competitive advantage in easily acquiring unskilled
and semiskilled labor. Government policies and
subsidies: The government of India is continuously
 monitoring and introducing the new policies for
encouraging the rural entrepreneurship. These
policies are very flexible, innovative, liberalized and
giving continues support to rural entrepreneurs. At
the same time government has also announced huge
subsidies for promoting the rural entrepreneurship.
Availability of raw materials. Most of the times the
rural entrepreneurs are depending upon the farm
based products as raw materials, which are available
through-out the year. These raw materials are
available in the rural area that is the reason there is
no transportation cost and flotation cost. Cost of
production: Rural entrepreneurs cost of production is
very low when compared to the urban industries. The
factors of production are available with low cost;
automatically the cost of production is also low.
Because of this rural entrepreneurs can sell their
goods and services with cheaper cost. Optimum
utilization of produces: Optimum utilization of farm
produces is only possible through the rural
entrepreneurship only. Most of the rural
entrepreneurs depend upon the farm produces as raw
materials. Employment generation for rural youth:
Rural entrepreneurs are providing hundred percent
jobs for rural youth. If the rural entrepreneurs are
succeeding in this activity the migration of the people
to urban from rural will be immediately stopped to a
maximum extent. Promotion cost: There is no
promotion cost for rural entrepreneurs; in fact the
competition is very less. Particularly there is no need
for advertising and other promotional activities for
their products. Potential customer: In this twenty-first
century rural villagers are economically strong and
also heavily populated. This heavy population can be
converted as potential customers. That is the reason
all the MNC’s are concentrated in rural villages for
their potentiality. Building the goodwill: Rural
entrepreneurs have a lot of scope building the
goodwill. Most of the rural entrepreneurs have ethical
values and also these people do not work for pure
profits.

Topic: SUSTAINABILITY ISSUES IN SOCIAL

ENTREPRENEURSHIP
93662 Define Social Entrepreneurship. Remember CO4 2

Key:
Social entrepreneurship is an approach by start-up
companies and entrepreneurs, in which they develop,
fund and implement solutions to social, cultural, or
environmental issues
93698 Define Social Entrepreneurship. Remember CO4 2

Key:
Social entrepreneurship is an approach by start-up
companies and entrepreneurs, in which they develop,
fund and implement solutions to social, cultural, or
environmental issues
94688 Explain the mechanism and criticism of Social Cost Remember CO4 16
Benefit analysis

Key:
Social cost-benefit analysis is a systematic and
cohesive economic tool (method) to survey all the
impacts caused by an urban development project. .
The main aim of a social cost-benefit analysis is to
attach a price to as many effects as possible in order
to uniformly weigh the above-mentioned
heterogeneous effects. A Social cost benefit analysis,
also known as economic analysis, is a decision-making
strategy which helps in assessing the impact of
investment business projects on the society as a
 complete. It is an organized and cohesive mechanism
to contemplate the impact of development projects on
society. The objective of analyzing the social cost
benefit is to weight the heterogeneous impact of your
development project on societal elements such as
pollution, real estate, legal prospects, health,
environment etc. As a result of the analysis, the
project decision maker can precisely elucidate the
social welfare impact of the project. The impact of
social cost-benefit analysis can be positive or
negative. The positive impact is called as a social
benefit and the negative impact is termed as a social
cost. SCBA is different from CBA in the sense that it
has an extensive view because it tries to study the
social values of the entire society rather than taking
into account the profitability of individuals who are a
section of the society. Outcomes of Social Cost-
Benefit Analysis: The result of making social cost-
benefit analysis is that it helps the business managers
to take policy decisions on the basis of the calculated
risks involved if the project is executed. The scrutiny
gives a lucid picture between cost and benefit
distribution letting the managers take an informed
decision. At the end of the SCB analysis, we can
conclude how the project will impact the employment
opportunities and standard of living of the society.
Externalities (harmful or beneficial impact of the
project) related to the project can be assessed after
the social impact of the project has been analyzed.
The outcome of this analysis metric helps the
government to take up projects which benefit the
entire society and not just a few individuals which
further improves the economy of the country.

Topic: WOMEN ENTREPRENEURSHIP

94477 Define women entrepreneurship. Remember CO4 2

Key:
Women entrepreneurship is the process where
women organise all the factors of production,
undertake risks, and provide employment to others
94478 Enumerate the five functions of a women Understand CO4 2
entrepreneur

Key:
Exploration of the prospects of starting a new
business enterprise Undertaking of the risks and
handling of the economic uncertainties involved in
business Introduction of innovations or imitation of
innovations Coordination, administration and control
Supervision and leadership.
94494 What are the major functions performed by a women Remember CO4 2
entrepreneurs?

Key:
Riskbearing Organisation Innovation
94076 Give a detailed account on Women Entrepreneurship. Remember CO4 8

Key:
Women entrepreneurs may be defined as a “Woman
or a group of women who initiate, organize and run a
business enterprise”. Government of India has
defined women entrepreneurs based on women
participation in equity and employment of a business
enterprise. Accordingly, a woman run a enterprise is
defined as “an enterprise owned and controlled by a
women having a minimum financial interest of 51% of
the capital and giving at least 51%of the employment
generated in the enterprise to women”. Women
entrepreneur constitute 10 % of the number of the
number of entrepreneur in the country. This has been
a significant growth in self-employment of women
 with women now starting new ventures at three times
the rate of men. They constitute 50% of the
population of our country with a lower literacy rate
than men. This statistical fact indicates that for the
economic growth of the nation, women should not be
encouraged to make their share of economic
contribution towards the country. One way of
achieving is by making women come out and become
entrepreneurs. In the traditional society, they were
confined to the four walls, playing household roles,
but in the modern society, they are coming out to
participate in all sorts od activities. Normally, women
entrepreneurship is found in the extension of their
kitchen activities, mainly in preparing commercially
the 3‟P‟s namely, Pickles, Papads and Powder. Few
of them venture into services industry relating to
hospitality, catering, educational services,
consultation or public relations, beauty clinics, etc.
Women enter entrepreneurship due to economic
factors which pushed them to be on their own and
urge them to do something independently. Women
prefer to work from their own work residence,
difficulty in getting suitable jobs and desire for social
recognition motivate them towards self-employment.
We see a lot of women professionals in engineering,
medicine, law etc. They are also setting up hospitals,
training centers, etc. “An enterprise owned and
controlled by a women having a minimum financial
interest of 51 per cent of the capital and giving at
least 51 per cent of the employment generated by the
enterprise to women.”—Government of India“ A
woman entrepreneur can be defined as a confident,
innovative and creative woman capable of achieving
self economic independence individually or in
collaboration, generates employment opportunities
for others through initiating, establishing and running
the enterprise by keeping pace with her personal,
family and social life.”—Kamal Singh
191633 Discuss the problems faced by women entrepreneurs in India. Analyze CO4 16

Key:
Problems faced by wmen entrepreneurs includes....

Problem of Finance - Finance is regarded as life blood for any

enterprise be in big or small. Firstly women do not generally
have property on their names to use them as collateral for
obtaining funds from external sources. So that access to the
external sources funds is limited. Secondly the banks also
consider women less credit-worthy and discourage women
barrowers on belief that they can at any time leave their
business. Attitude of banks and financial institutes mostly do
not readily allow them to grant loans to women for business.
Difficulty to access formal, easy, collateral free and
transparent financing is a major problem area for women-led
start-ups.
Training Programs - Training programs are essential to new
rural and young entrepreneurs who wish to set up a small and
medium scale unit. The programs enrich the skill and potential
of women entrepreneur.
Male dominated Society - The constitution of India speaks of
equality between sexes. But in practice women are looked
upon as abla i.e. Weak in all respects. In male dominated
Indian society, women are not treated equal to men. This turn
serves as a barrier to women entry into business.
Lack of Education - In India around 60% of women are still
illiterate. Illiteracy is the root cause of socio- economic
problem. Due to the lack of education women are not aware of
business, technology and market knowledge. Also lack of
education causes low achievement motivation among women.
Market Oriented Risk - A number of women have to face the
challenges of market because of stiff competition. Many
business women find it difficult to capture the market and
compete with their product. They are not fully aware of the
changing market conditions.
 Motivational Factors -Successful businessmen can be self
motivated through setting up a mind and taking up risk and
accepting social responsibilities on shoulder. The other factors
such as family support government policies financial
assistance etc. are also important to set up business.
Lack of Confidence - Women lack confidence in their
strength and competence. The family members and the society
and reluctant to stand beside their entrepreneurial growth
Lack of financial support and credit resources provide a
setback for women - A market research shows that less than
3% of the women started Start-ups get funded by Venture
Capital funds
Limited Mentoring Opportunities - Absence of guidance as to
how a women aspiring to become an entrepreneur could
achieve her goals and dreams cause several women to step
down. Women require mentoring regarding the required skills
and qualifications required to be able to step into the business
world and also how to deal with existing male-dominant
competitive market. It is utmost crucial to address these gaps
in knowledge, skills and attitudes through capacity building
programmes.
Lack of Formal Work spaces - Women have restricted
mobility due to their family ties or could be their commitment
towards children. The lack suitable work spaces around their
home posses a big challenge. A single lady looking for an
office space is often a bottle neck to move forward
Marketing Problems - Another challenge faced by women
entrepreneurs include being exploited by middlemen. Due to
lack of resources to market their products to a large
community, women entrepreneurs and start-ups have to
depend on middlemen for their marketing. E-commerce has
however reduced the difficulties faced; however unavailability
of internet does not eradicate this problem completely.

Mapping
Questions in Unit-5 Pattern Marks
COs
Topic: CLASSIFICATION OF PROJECTS
123731 How do you categorize a project? Remember CO5 2

Key:
A project categorization method is defined as the
procedure to be applied in identifying the set of
characteristics (or attributes) that will be used to:
Place specific projects within specific categories, and.
Classify projects within a category (or sub-category).
130802 Critically analyze the different types of Projects. Analyze CO5 16

Key:
Every Project is different. Projects can be classified
on several different points. The classification of
projects in project management varies according to a
number of different factors such as complexity,
source of capital, its content, those involved and its
purpose. Projects can be classified on the following
factors. According to complexity: Easy: A project is
classified as easy when the relationships between
tasks are basic and detailed planning or organisation
are not required. A small work team and few external
stakeholders and collaborators are common in this
case. Complicated: The project network is broad and
complicated. There are many task interdependencies.
With these projects, simplification where possible is
everything. Cloud-based apps such as Sinnaps will
immensely help to simplify complicated projects by
automatically calculating the project’s best work path
and updating any changes introduced through its use
of different types of project management tools. Here,
the importance of project management and how an
effective tool could help you! According to source of
capital: Public: Financing comes from Governmental
 institutions. Private: Financing comes from
businesses or private incentives. Mixed: Financing
comes from a mixed source of both public and private
funding. According to project content: Construction:
These are projects that have anything to do with the
construction of a civil or architectural work.
Predictive methods are used along with agile
techniques which will be explained later on. IT: Any
project to do with software development, IT system
etc. The types of project management information
systems vary across the board, but in today’s world
are very common. Business: These projects are
involved with the development of a business,
management of a work team, cost management, etc.,
and usually follow a commercial strategy. Service or
product production: Projects that involve themselves
with the development of an innovative product or
service, design of a new product, etc. They are often
used in the R & D department. According to those
involved: Departmental: When a certain department
or area of an organisation is involved. Internal: When
a whole company itself is involved in the project’s
development. Matriarchal: When there is a
combination of departments involved. External: When
a company outsources external project manager or
teams to execute the project. This is common in
digital transformations, process improvements and
strategy changes, for example. According to its
objective: Production: Oriented at the production of a
product or service taking into consideration a certain
determined objective. Social: Oriented at the
improvement of the quality of life of people.
Educational: Oriented at the education of others.
Community: Oriented at people too, however with
their involvement. Research: Oriented at innovation
and the gaining of knowledge.

Topic: DEFINING BUSINESS IDEA

130858 What are the sources of good Business idea? Remember CO5 16
Elaborate.

Key:
What are the various sources of business ideas that
can help you start a prosperous business? Well,
business ideas are crucial as they determine the
potential energy of the company at start-up levels to
the time when it begins to flourish while achieving set
objectives. Here are the top 7 sources of business
ideas and opportunities for entrepreneurship that can
lead you to a successful business. 1. Interests and
hobbies A hobby is an activity that you enjoy doing
during your leisure-time and is one of the primary
sources of business ideas. In fact, most people have
founded great successful businesses while pursuing
their interests or hobbies. For instance, if you enjoy
traveling, playing with computers, music, sports,
performing or cooking, you can seamlessly develop it
into a business. You can join the tourism,
entertainment or hospitality industry by venturing
deeper into your favorite activity. These are just a few
suggestions since there are lots of leisure activities
that can lead you to the world of successful
entrepreneurship. Just consider what you are good at,
and you are ready to go. 2. Customer surveys The
starting point of any new business should be the
clients because their needs and wants justify the
service or product that you can offer to them. The
wants and needs of the customers are, therefore, the
sources of business ideas generation and you can
ascertain them by carrying out a thorough survey.
You can conduct such a survey, whether formally or
informally, through questionnaires, interviews or
observation as you list the sources of business ideas
that work best for you. While carrying out the
surveys, you can talk with your friends and family to
discover what the potential customers need, yet it is
not readily available to them. They may not be
contented with the existing service or product and
need improvement. In this case, you can step in and
talk with the people in the distribution chain
including wholesalers, retailers, manufacturers,
agents, and distributors. It is essential to prepare the
questions in advance that you can use in interviews or
put on the questionnaires. Sources of new ideas for
business Sources of business ideas generation
Primary sources of business ideas What are the
various sources of business ideas Sources of
developing business ideas Sources:
africajumpstart.com Source: UGC The relationship
you build with your potential customers during the
survey leads you to new sources of business ideas as
they freely share their challenges with you. Thus,
ensure that you talk to several existing and potential
customers to familiarize with them and understand
their needs. Be a good listener and observer as you
show them that you care by sharing with them the
possible solutions. The more information they are
willing to give you, the higher your chances of
founding a successful business. 3. Brainstorming and
dreams Brainstorming is a method of problem-solving
and qualifies as one of the seven sources of business
ideas since every company focuses on offering
solutions to the problems facing the customers. The
secret behind brainstorming is to come up with as
many ideas and options as possible. This process
usually starts with a problem statement or question.
For instance, you may ask the question “what are the
services or products necessary in the home that are
hard to get?” In this way, each design will result in
one or more ideas and lead to several opportunities
for becoming an entrepreneur. Dreams are also part
of the sources of developing business ideas though
most people tend to ignore them. However, it pays to
consider and follow them up as they can lead to a
booming business even if they may seem
unintelligible and strange. Do not hesitate to wake up
in the middle of the night and jot down the ideas
before they disappear at the crack of dawn. While you
can get ideas during the deep sleep in the form of
dreams, you can also discover the germ of a
wonderful business idea as you meditate during the
night when you lose sleep. The rules of brainstorming
Here are the rules that will help you when
brainstorming for different sources of business ideas:
Never judge or criticize the ideas and suggestions of
others Encourage freewheeling and invite crazy or
wild ideas Quantity is paramount where the more the
number of ideas, the better Combine and develop the
ideas that friends and colleagues give you Never
procrastinate 4. Franchises A franchise is a situation
where a sole trademark distributor or manufacturer
of a product gives exclusive rights to independent
retailers for local distribution. This is done in return
for the consistency of the retailers to the set
operating procedures and payment of royalties. As
one of the sources of business ideas for
entrepreneurs, franchising can take different forms
but the most common and preferred one is where you
are offered the image, operating procedures and the
name of an established business. Besides buying a
franchise, you can also build on and sell its concept at
a profit. 5. Mass media Sources of new ideas for
business Sources of business ideas generation
Primary sources of business ideas What are the
various sources of business ideas Sources of
developing business ideas Source: UGC The mass
media; including television, newspapers, Internet,
radio, and magazines are a great source of ideas,
information, and opportunities. One way to become a
 successful entrepreneur is taking a careful look at the
advertisements and commercials in these media. By
reading a magazine or newspaper, you can easily
come across a business for sale that interests you.
These media can also report on the trending fashion,
and pressing customer needs that you can jump on
and start a business. If, for example, you find out that
there is a high demand for physical fitness and
healthy eating practices, you can start a fitness and
healthy eating centre. While traditional media
including television, radio, and newspapers have been
great sources of ideas to run new business, the
Internet has emerged as the latest information
technology with instant millions of ideas. With just a
click of a button on your computer or phone, you can
get the best idea that will work perfectly according to
your interests and locality. Starting a successful
business has never been this easy! 6. Personal
experience and talents Most of the ideas and
opportunities for successful businesses are a result of
the experiences in the place of work. For example, an
experienced manager working for a leading
restaurant can eventually decide to start a business
related to hospitality even before he retires. As a
potential entrepreneur, therefore, you can make the
most use of your skills and experiences as crucial
sources of business ideas generation. They also
determine the type of venture that you start as you
capitalize on them. If you are gifted or have
experience in a specific field, then it is time to
analyze just talent or skills. You can start off with the
following self-examination questions: What am I
passionate about? What talents or skills do I possess?
Are people willing to pay me for my skills? What do I
need to build on my skills? 7. Trade fairs and
exhibitions Trade fairs and exhibitions are among the
top sources of developing business ideas. They are
usually advertised on the Internet, radio, and
newspapers, and by attending such events regularly,
you will discover new services and products. You will
also meet with manufacturers, sales representatives,
distributors, wholesalers, and franchisers who will
answer all your questions and inspire you to start a
business that will thrive. In fact, some of them may be
in need of someone like you to partner with, and this
will be an exceptional opportunity to partner with
renowned entrepreneurs and franchisers. Sound
business ideas from reliable sources of new ideas for
business become good investments when
implemented. Hence, business visionaries and
potential entrepreneurs must brainstorm on the ideas
that can lead them to a well-organized and successful
business that meets the needs of the clients and
promote the economy of the society. Business idea
generation, therefore, helps you identify the
opportunities, the people or companies to partner
with and your competitors. As you compare the
different sources of business ideas and the available
opportunities, you can easily go for an idea that
involves insignificant risks and no possible failure at
the starting stage. You also get to know the latest
technology that will be appropriate for your
communications with clients, suppliers, distributors,
and partners. When all is said and done, you get to
know how to respond to the ever-changing needs and
fashions.

Topic: ENVIRONMENTAL ANALYSIS

123770 Why is environmental analysis important? Understand CO5 2

Key:
An environmental analysis in plays an essential role in
business management by providing possible
opportunities or threats outside the company in its
 external environment. The purpose of an
environmental analysis is to help to develop a plan by
keeping decision-makers within an organization.

Topic: FORMS OF BUSINESS OWNERSHIP

123773 What do you understand by Limited Liability Remember CO5 2
Company?

Key:
A limited liability company (LLC) is a corporate
structure in the United States whereby the owners
are not personally liable for the company's debts or
liabilities. Limited liability companies are hybrid
entities that combine the characteristics of a
corporation with those of a partnership or sole
proprietorship
125797 Define Sole proprietorship. Understand CO5 2

Key:
A sole proprietorship, also known as the sole trader,
individual entrepreneurship or proprietorship is a
type of enterprise that is owned and run by one
person and in which there is no legal distinction
between the owner and the business entity.
125836 What are the 5 types of business ownership? Remember CO5 2

Key:
Sole Proprietorships.
Partnerships.
Corporations.
S-Corporations.
Limited Liability Company (LLC)
130790 What are the different types of Business ownership? Remember CO5 16
Explain in Brief.

Key:
The different types of business ownership are:- 1.
Single Ownership (Private Undertaking). 2.
Partnership. 3. Joint Stock Company 4. Cooperative
Organisation (Or Societies) 5. Public Sector 6. Private
Sector.
Type # 1. Single Ownership: Ownership when applied
to an industrial enterprise means title to and
possession of the assets of the enterprise, the power
to determine the policies of operation, and the right
to receive and dispose of the proceeds. It is called a
single ownership when an individual exercises and
enjoys these rights in his own interest. A business
owned by one man is called single ownership. Single
ownership does well for those enterprises which
require little capital and lend themselves readily to
control by one person. Examples of enterprises run by
single owner are printing press, auto repair shop,
wood working plant, a small fabrication shop, etc.,
Le., retail trades, service industries and small
engineering firms. In single ownership, one person
contributes the original assets to start the business,
maintains and controls business operations, reaps full
benefit in terms of profit and is fully liable for all
debts associated with the business. Type # 2.
Partnership: A single owner becomes inadequate as
the size of the business enterprise grows. He may not
be in a position to do away with all the duties and
responsibilities of the grown business. At this stage,
the individual owner may wish to associate with him
more persons who have either capital to invest, or
possess special skill and knowledge to make the
existing business still more profitable. Such a
combination of individual traders is called
Partnership. Partnership may be defined as the
relation between persons who have agreed to share
the profits of a business carried on by all or any of
them acting for all. Individuals with common
purposes join as partners and they put together their
property, ability, skill, knowledge, etc., for the
purpose of making profits. In brief, partnership is an
association of two or more (up to 20) persons to carry
on as co-owners of a business for profit. Partnerships
are based upon a partnership agreement which is
generally reduced to writing. It should cover all areas
of disagreement among the partners. It should define
the authority, rights and duties of each partner. It
should specify- how profits and losses will be divided
among the partners, etc. Kinds of Partners: (i) Active
Partners who take active part in the management of
the business enterprise. (ii) Sleeping Partners who do
not take any active part in the conduct of the
business. Both Active and Sleeping partners are
responsible for the debts of the Partnership. General
Duties of Partners: Partners should: (i) Be just and
faithful to one another. (ii) Render true accounts and
full information about everything that affects any
partner. (iii) Cooperate and accommodate each other.
(iv) Have confidence in each other and better mutual
understanding. (v) Respect the views of one-another.
(ii) Limited Partnership: Limited partnership type of
ownership overcomes the two main disadvantages
[e.g. number (i) and (v) mentioned above] of general
partnership. Limited partnership is an association of
one or more general partners who manage the
business and one or more limited partners whose
liability is limited to the capital they have invested in
the business. Limited partners share the profit but
they do not participate or interfere with the control or
management of the firm. Moreover limited partners
have their liabilities limited to the amount of their
investment. Thus, those investors and lenders who
used to hesitate investing in the venture can do so
without much risk. Limited partnership type of
ownership is easy and less costly to form, and
personal incentive to succeed is retained. A
disadvantage associated with limited partnership is
that the limited partner, though he invests in the
business, has no voice in the management. Type # 3.
Joint Stock Company: Joint Stock Company
overcomes many of the disadvantages associated with
Partnership types of industrial ownership, such as: (i)
Difficulties in raising capital, (ii) Easy disruption, (iii)
Lack of facility for centralised management, and (iv)
Unlimited liability, etc. A joint stock company is an
Association of individuals, called shareholders, who
join together for profit and agree to supply capital
divided into shares that are transferable for carrying
on a specific business. Death, insolvency, disablement
or lunacy of the shareholders does not affect the joint
stock company. A joint stock company consists of
more than twenty persons for carrying any business
other than the banking business. These persons give
a name to the company, mention the purpose for
which it is formed, and state the nature and the
amount of capital (shares) to be issued, etc., and
submit the proposal to the Registrar of Companies. As
the registrar issues a certificate in this connection,
the company starts operating. The managing body of
a joint stock company is Board of Directors elected by
the shareholders. The Board of Directors: (i) Makes
policies; (ii) Takes decisions; and (iii) Runs the
company efficiently. The liability of the members (or
shareholders) of a joint stock company is limited to
that capital only of which they hold the shares.
Finance is raised by issuing shares, debentures, bank
loans, loans from industrial and finance corporations.
Types of Joint Stock Company: There are two types of
joint stock companies: (a) Private Limited Company:
(i) The capital is collected from the private partners;
some of them may be active while others being
sleeping. (ii) Private limited company restricts the
right to transfer shares, avoids public to take up
shares or debentures. (iii) The number of members is
between 2 and 50, excluding employee and ex-
employee sharehold​ers. (iv) The company need not
file documents such as consent of directors, list of
directors, etc., with the Registrar of Joint Stock
Companies. (v) The company need not obtain from the
Registrar, a certificate of commencement of business.
(vi) The company need not circulate the Balance
Sheet, Profit and Loss Account, etc., among its
members; but it should hold its annual general
meeting and place such financial statements in the
meeting. (vii) A private company must get its
accounts audited. (viii) A private company has to send
a certificate along with the annual return to the
Registrar of Joint Stock Companies stating that it
does not have shareholders more than fifty excluding
the employee and ex-employee shareholders.
Actually, a private joint stock company resembles
much with partnership and has the advantage that
big capital can be collected, than could be done so in
partnership. (b) Public Limited Company: (i) In Public
limited company, the capital is collected from the
public by issuing shares having small face value (Rs.
50,20,10). (ii) The number of shareholders should not
be less than seven, but there is no limit to their
maximum number. (iii) A public limited company has
to file with the Registrar of Joint Stock Companies,
documents such as consent of the directors, list of
directors, director’s contract, etc., along with the
memorandum of association and articles of
association. (iv) A public company has to issue a
prospectus to the public. (v) It has to allot shares
within 180 days from the date of prospectus. (vi) It
can start only after receiving the certificate to
commence business. (vii) It has to hold a Statutory
Meeting and to issue a Statutory Report to all
members and also to the Registrar within a certain
period. (viii) There is no restriction on the transfer of
shares. (be) Directors of the company are subject to
rotation. (x) The public company must get its account
audited every year by registered auditors. (xi) It has
to send financial statements to all members and to
the Registrar. (xii) It has to hold a general meeting
every year. (xiii) The Managing Agent gets a fixed
percentage of net profit as remuneration. Advantages
of Joint Stock Companies: (i) A huge sum of money
can be raised. (ii) It associates limited liability with it.
(iii) Shares are transferable. (iv) Company’s life is not
affected by the life (death) of shareholders. (v)
Services of specialists can be obtained. (vi) Risk of
loss is divided among many shareholders. (vii) The
company associates with it stability, efficiency and
flexibility of management. Disadvantages of Joint
Stock Companies: (i) A good deal of legal formalities
is required for the formation of a joint stock company.
(ii) Company is managed by big shareholders only.
(iii) High paid officials manage the whole shows; they
cannot have as high interests in the company as the
proprietors can have. (iv) People can commit frauds
with the company. (v) Board of directors and
managers who remain familiar with the financial
position of the company may sell or purchase shares
for their personal profits. (vi) It is difficult to maintain
secrecy as in partnership. (vii) The team spirit with
which partnership works, is lacking in a joint stock
company. (viii) Divided responsibility. Applications of
Joint Stock Companies: (i) Steel mills, (ii) Fertiliser
factories, and (iii) Engineering concerns, etc. Type #
4. Cooperative Organisation (Or Societies): It is a
form of private ownership which contains features of
large partnership as well as some features of the
corporation. The main aim of the cooperative is to
eliminate profit and provide goods and services to the
members of the cooperative at cost. Members pay
 fees or buy shares of the cooperative, and profits are
periodically redistributed to them. Since each
member has only one vote (unlike in joint stock
companies), this avoids the concen​tration of control
in a few hands. In a cooperative, there are
shareholders, a board of directors and the elected
officers similar to the corporation. There are periodic
meetings of shareholders, also. Special laws deal with
the formation and taxation of cooperatives.
Cooperative organisation is a kind of voluntary,
democratic ownership formed by some moti​vated
individuals for obtaining necessities of everyday life
at rates less than those of the market. The principle
behind the cooperative is that of cooperation and self-
help. Forms of Cooperative Enterprises: (i)
Consumer’s Cooperatives, in retail trade and services.
(ii) Producer Cooperatives, for group buying and
selling such items as dairy products, grain, fruit, etc.
(iii) Cooperative farming for more and good quality
yield from the farms. (iv) Cooperative housing for
constructing and providing houses to the members of
the association at relatively lesser rates. (v)
Cooperative credit society, to provide loans to the
needy individuals. Advantages of Cooperative
Enterprises: (i) Daily necessities of life can be made
available at lower rates. (ii) It is the democratic form
of ownership. (iii) Overheads are reduced as members
of the cooperative may render honorary services. (iv)
It promotes cooperation, mutual assistance and the
idea of self-help. (v) The chances of large stock-
holding (hoarding) and black marketing are
eliminated. (vi) No one person can make huge profits.
(vii) Common man is benefited by cooperatives. (viii)
Monetary help can be secured from government. (ix)
Goods required can be purchased directly from the
manufacturers and therefore can be sold at less rates.
Disadvantages of Cooperative Enterprises: (i) Since
the members of the cooperative manage the whole
show, they may not be competent enough to make it a
good success. (ii) Finance being limited, specialist’s
services cannot be taken. (iii) Conflict may arise
among the members on the issue of sharing
responsibility and enjoying authorities. (iv) Members
who are in position may try to take personal
advantages. (v) Members being in services may not
be able to devote necessary attention and adequate
time for supervising the works of the cooperative
enterprise. Type # 5. Public Sector: Concept of Public
Sector: A public enterprise is one that is: (1) Owned
by the state, (2) Managed by the state, or (3) Owned
and managed by the state.

Topic: NETWORK ANALYSIS

123723 What is PERT used for? Understand CO5 2

Key:
A PERT chart is a project management tool used to
schedule, organize, and coordinate tasks within a
project. PERT stands for Program Evaluation Review
Technique, a methodology developed by the U.S.
Navy in the 1950s to manage the Polaris submarine
missile program
Topic: PLANNING BUSINESS PROCESS
123707 What questions should you ask yourself when starting Apply CO5 2
a business?

Key:
What problem am I solving? Answer this: My product
will solve What funds do I absolutely need to start?
Maybe your dream is to open up a storefront to sell
your handmade chocolates. Who else is doing this?
What's my 'special sauce'? What resources do I
currently have to get started?
 Topic: PROJECT APPRAISAL
123687 What are the objects of project appraisal? Remember CO5 2

Key:
Assessment of a project in terms of its economic,
social and financial viability. Decide to Accept or
reject a Project. It is a tool to check the viability of a
Project Proposal.
127517 Give a detailed account on Project Appraisal. Remember CO5 8

Key:
Project appraisal is the process of assessing, in a
structured way, the case for proceeding with a
project or proposal, or the project's viability. It often
involves comparing various options, using economic
appraisal or some other decision analysis technique
Assessment of a project in terms of its economic,
social and financial viability. Decide to Accept or
reject a Project. It is a tool to check the viability of a
Project Proposal. "Effective project appraisal offers
significant benefit to partnerships and most
importantly to local community. A good appraisal
justifies spending money on a project. It is an
important tool in decision making and lays the
foundation for delivery and evaluation of services.
Project appraisal is the process of assessing, in a
structured way, the case for proceeding with a
project or proposal, or the project's viability. It often
involves comparing various options, using economic
appraisal or some other decision analysis technique
Project appraisal methodologies are methods used to
access a proposed project's potential success and
viability. These methods check the appropriateness of
a project considering things such as available funds
and the economic climate. A good project will service
debt and maximize shareholders' wealth.
Topic: PROJECT EVALUATION
123755 What is meant by Break-Even Analysis? Remember CO5 2

Key:
It is based on categorizing production costs between
those which are "variable" (costs that change when
the production output changes) and those that are
"fixed" (costs not directly related to the volume of
production).

127578 How project evaluation is done? Explain in detail. Remember CO5 16

Key:
Project evaluation is a systematic and objective
assessment of an ongoing or completed project.1 The
aim is to determine the relevance and level of
achievement of project objectives, development
effectiveness, efficiency, impact and sustainability.
These six steps can help put your organization on the
right track for continuous quality improvement. Step
1: Define your stakeholders. Step 2: Describe the
program. Step 3: Focus the design of your evaluation
Step 4: Gather evidence. Step 5: Draw conclusions.
Step 6: Present findings and ensure use. All activities
consistent with closing out the project Extinction: no
real afterlife Addition: institutionalization Integration
to the functional organization Starvation: loosing the
resources Final Report Elements Project performance
Administrative performance Organizational structure
Team performance Project management techniques
Benefits to the organization and customer

Topic: PROJECT MANAGEMENT

123779 While preparing a Project report what are the aspects Apply CO5 2
related to market potential of the product should be
 stated?

Key:
1)Demand and supply position
2)Expected Price
3)Marketing Strategy
4)After-sales service
5)Transportation.
125875 What is Project report? Remember CO5 2

Key:
A Project Report is a document which provides details
on the overall picture of the proposed business. The
project report gives an account of the project
proposal to ascertain the prospects of the proposed
plan/activity
125880 What is Project report? Remember CO5 2

Key:
A Project Report is a document which provides details
on the overall picture of the proposed business. The
project report gives an account of the project
proposal to ascertain the prospects of the proposed
plan/activity
127639 Elucidate the issues related to project management. Remember CO5 8

Key:
Project : A group of milestones or phases, activities or
tasks that support an effort to accomplish something
Management : is the process of Planning, Organizing,
Controlling and Measuring A collection of linked
activities, carried out in an organised manner, with a
clearly defined START POINT and END POINT to
achieve some specific results desired to satisfy the
needs of the organization at the current time A
dynamic process that utilises the appropriate
resources of the organisation in a controlled and
structured manner, to achieve some clearly defined
objectives identified as needs. Who uses Project
Management? Nearly Everyone to some degree
People plan their Days, their Weeks, their Vacations
and their Budgets and keep a simple project
management form known as ‘’To Do’’ list Any Process
or Means used to track tasks or efforts towards
accomplishing a goal could be considered Project
Management Issues in Project Management Keeping
Teams on The Same Page. Poorly Defining the Goals
And Objectives. Unrealistic Deadlines. Finding The
Right Project Management Software. Scope Creep is
Insidious And Creepy. Insufficient Team Skills.
Miscommunication Cause Conflicts. Risk
Management.
127679 Elaborate the process of Business Process project Understand CO5 16
management.

Key:
Process Management defines around the governance
of ongoing operations of a process. A process is
generally ongoing and normally doesn’t have an end.
It is a recurring series of repetitive tasks. Process
Management is a continuous analysis for
improvement or reengineering with no clarity defined
beginning and end states. Business management
process or BPM is a methodical approach of
assembling an organization’s workflow to make it
sustainable and capable for an adaption to the
changing environment Project Management aims to
accomplish an objective by initiating, planning,
executing and controlling the work. A project has a
beginning and ending either well defined or not.
Unlike process a project is not repetitive and project
management is mainly focused on managing a project
 using different processes to achieve the desired
results. Project Management or PMP is the
integration of all processes, methods, knowledge and
skill to meet some pre-determined objectives. Project
Management Methodologies differ from project to
project and system to system. BPM is a series of
repetitive steps so stakeholders are confident to
achieve a concrete goal. A process is generally
automated in a standardized optimized way or can be
manually operated without assisting technology. It is
visualized by a flowchart of logical steps, so it is easy
to maintain and monitor. Following are the
methodologies and tools of Business Processes
Management. Life Cycle Improvement of a project by
modeling, implementation and monitoring. Process
Discovery of a system to identify the areas of
operation which could benefit and increase efficiency
Simulation of a process before execution or during
development. Enables Business Analysts, Managers,
and Architects to create and design business process
diagrams. Challenges of BPM: BPM sometimes
becomes a challenge because of the following issues
Slowing or halting of a process at a specific stage due
to a human error or difficulty. The Duplication of
work and redundancy due to inefficient processes
often having some areas that are repeated or
unnecessary. Lack of recognition because the
management does not have a way of viewing where
processes stand, what the status is, and how they are
performing generally, and specifically.
Communication gaps between the systems which
cause malfunctioning.

Topic: PROJECT REPORT PREPARATION

123698 Define Business Plan. Remember CO5 2

Key:
A business plan is a written statement of what an
entrepreneur proposes to take up. It is a kind of
future course of action what the entrepreneur hopes
to achieve in his business.

127785 Give a detailed account on Project report preparation Remember CO5 16

Key:
A Project Report is a document which provides details
on the overall picture of the proposed business. The
project report gives an account of the project
proposal to ascertain the prospects of the proposed
plan/activity.
Project Report is a written document relating to any
investment. It contains data on the basis of which the
project has been appraised and found feasible. It
consists of information on economic, technical,
financial, managerial and production aspects. It
enables the entrepreneur to know the inputs and
helps him to obtain loans from banks or financial
Institutions. The project report contains detailed
information about Land and buildings required,
Manufacturing Capacity per annum, Manufacturing
Process, Machinery & equipment along with their
prices and specifications, Requirements of raw
materials, Requirements of Power & Water,
Manpower needs, Marketing Cost of the project,
production, financial analyses and economic viability
of the project. Contents of a Project Report Following
are the contents of a project report.
1. General Information A project report must provide
information about the details of the industry to which
the project belongs to. It must give information about
the past experience, present status, problems and
future prospects of the industry. It must give
information about the product to be manufactured
and the reasons for selecting the product if the
 proposed business is a manufacturing unit. It must
spell out the demand for the product in the local,
national and the global market. It should clearly
identify the alternatives of business and should clarify
the reasons for starting the business. 2. Executive
Summary A project report must state the objectives of
the business and the methods through which the
business can attain success. The overall picture of the
business with regard to capital, operations, methods
of functioning and execution of the business must be
stated in the project report. It must mention the
assumptions and the risks generally involved in the
business. 3. Organization Summary The project
report should indicate the organization structure and
pattern proposed for the unit. It must state whether
the ownership is based on sole proprietorship,
partnership or joint stock company. It must provide
information about the bio data of the promoters
including financial soundness. The name, address,
age qualification and experience of the proprietors or
promoters of the proposed business must be stated in
the project report. 4. Project Description A brief
description of the project must be stated and must
give details about the following: Location of the site,
Raw material requirements, Target of production,
Area required for the workshed, Power requirements,
Fuel requirements, Water requirements, Employment
requirements of skilled and unskilled labour,
Technology selected for the project, Production
process, Projected production volumes, unit prices,
Pollution treatment plants required. If the business is
service oriented, then it must state the type of
services rendered to customers. It should state the
method of providing service to customers in detail.
130770 Evaluate the structure of a project report. Remember CO5 16

Key:
The project report is an extremely important aspect
of the project. It should be properly structured and
also necessary and appropriate information regarding
the project. No data fields are to be exposed in the
project field. The aim of the project is to produce a
good product and a good report and that software,
hardware, theory etc. that you developed during the
project are merely a means to this end. Design
document has to be progressively converted to a
project report as and when the various stages of
project are completed. Ideally you should produce the
bulk of the report as you go along and use the last
week or two to bring it together into a coherent
document. How to write a Project Report A tidy, well
laid out and consistently formatted document makes
for easier reading and is suggestive of a careful and
professional attitude towards its preparation.
Remember that quantity does not automatically
guarantee quality. A 150 page report is not twice as
good as a 75-page one, nor a 10,000 line
implementation twice as good as a 5,000 line one.
Conciseness, clarity and elegance are invaluable
qualities in report writing, just as they are in
programming, and will be rewarded appropriately.
Try to ensure that your report contains the following
elements (the exact structure, chapter titles etc. is up
to you): Title page This should include the project
title and the name of the author of the report. You can
also list the name of your supervisor if you wish.
IMPORTANT: Before submission you should assemble
a project directory which contains all your software,
READMEs etc. and your project report (source files
and pdf or postscript). Abstract The abstract is a very
brief summary of the report's contents. It should be
about half a page long. Somebody unfamiliar
withyour project should have a good idea of what it's
about having read the abstract alone and will know
whether it will be of interest to them.
Acknowledgements It is usual to thank those
individuals who have provided particularly useful
assistance, technical or otherwise, during your
project. Your supervisor will obviously be pleased to
be acknowledged as he or she will have invested quite
a lot of time overseeing your progress. Contents page
This should list the main chapters and (sub)sections
of your report. Choose self-explanatory chapter and
section titles and use double spacing for clarity. If
possible you should include page numbers indicating
where each chapter/section begins. Try to avoid too
many levels of subheading -three is sufficient.
Introduction This is one of the most important
components of the report. It should begin with a clear
statement of what the project is about so that the
nature and scope of the project can be understood by
a lay reader. It should summarise everything you set
out to achieve, provide a clear summary of the
project's background, relevance and main
contributions. The introduction should set the context
for the project and should provide the reader with a
summary of the key things to look out for in the
remainder of the report. When detailing the
contributions it is helpful to provide pointers to the
section(s) of the report that provide the relevant
technical details. The introduction itself should be
largely non-technical. It is useful to state the main
objectives of the project as part of the introduction.
However, avoid the temptation to list low-level
objectives one after another in the introduction and
then later, in the evaluation section (see below), say
reference to like "All the objectives of the project
have been met...". Background The background
section of the report should set the project into
context and give the proposed layout for achieving
the project goals. The background section can be
included as part of the introduction but is usually
better as a separate chapter, especially if the project
involved significant amount of ground work. When
referring to other pieces of work, cite the sources
where they are referred to or used, rather than just
listing them at the end. Body of report The central
part of the report usually consists of three or four
chapters detailing the technical work undertaken
during the project. The structure of these chapters is
highly project dependent. They can reflect the
chronological development of the project, e.g. design,
implementation, experimentation, optimisation,
evaluation etc. If you have built a new piece of
software you should describe and justify the design of
your program at some high level, possibly using an
approved graphical formalism such as UML. It should
also document any interesting problems with, or
features of, your implementation. Integration and
testing are also important to discuss in some cases.
You need to discuss the content of these sections
thoroughly with your supervisor. Evaluation Be
warned that many projects fall down through poor
evaluation. Simply building a system and
documenting its design and functionality is not
enough to gain top marks. It is extremely important
that you evaluate what you have done both in
absolute terms and in comparison with existing
techniques, software, hardware etc. This might
involve quantitative evaluation and qualitative
evaluation such as expressibility, functionality, ease-
of-use etc. At some point you should also evaluate the
strengths and weaknesses of what you have done.
Avoid statements like "The project has been a
complete success and we have solved all the
problems asssociated with ...! It is important to
understand that there is no such thing as a perfect
project. Even the very best pieces of work have their
limitations and you are expected to provide a proper
 critical appraisal of what you have done Conclusions
and Future Work The project's conclusions should list
the things which have been learnt as a result of the
work you have done. For example, "The use of
overloading in C++ provides a very elegant
mechanism for transparent parallelisation of
sequential programs". Avoid tedious personal
reflections like "I learned a lot about C++
programming..." It is common to finish the report by
listing ways in which the project can be taken further.
This might, for example, be a plan for doing the
project better if you had a chance to do it again,
turning the project deliverables into a more polished
end product. Bibliography This consists of a list of all
the books, articles, manuals etc. used in the project
and referred to in the report. You should provide
enough information to allow the reader to find the
source. In the case of a text book you should quote
the name of the publisher as well as the author(s). A
weakness of many reports is inadequate citation of a
source of information. It's easy to get this right so
there are no excuses. Each entry in the bibliography
should list the author(s) and title of the piece of work
and should give full details of where it can be found.
Appendix The appendices contain information which
is peripheral to the main body of the report.
Information typically included are things like parts of
the code, tables, test cases or any other material
which would break up the theme of the text

130893 Why do scientists and engineers need training in Understand CO5 16

report writing?Discuss.

Key:
Engineers who can convey that essential information
improve communication inside companies. Better
communication ultimately increases efficiency and
productivity. For this reason, employers view
engineers with good communication and technical
writing skills as highly valuable A technical report
(also scientific report) is a document that describes
the process, progress, or results of technical or
scientific research or the state of a technical or
scientific research problem. It might also include
recommendations and conclusions of the research. A
good technical writer requires five important skills or
characteristics: • Facility with technology. • Ability to
write clearly. • Talent in showing ideas graphically. •
Patience in problem-solving/troubleshooting. • Ability
to interact with SMEs (Subject Matter Experts)