Please refer to Small Business and Entrepreneurship Class 11 Business Studies Important Questions with solutions provided below. These questions and answers have been provided for Class 11 Business Studies based on the latest syllabus and examination guidelines issued by CBSE, NCERT, and KVS. Students should learn these problem solutions as it will help them to gain more marks in examinations. We have provided Important Questions for Class 11 Business Studies for all chapters in your book. These Board exam questions have been designed by expert teachers of Standard 11.
Class 11 Business Studies Important Questions Small Business and Entrepreneurship
Very Short Answer Type Questions
Question. Which type of Industry uses family labour and local available talent while running the business?
Answer : Cottage industries uses labour and local available talent while running the business
Question. Name any 2 merits of SSLs in the export trade of India.
• Small industries are best suited for customised production. i.e. designing the product as per the tastes/ preferences/needs of individual customers
• Small industries have inherent strength of adaptability and a personal touch and therefore maintain good personal relations with both customers and employees.
Question. What different parameters are used to measure the size of manufacturing business?
Answer : In the case of enterprises engaged in the manufacture or production of goods pertaining to any industries specified in the first schedule to the Industries (Development and Regulation) Act, 1951, there are three types of enterprises:
Micro enterprise: investment in plant and machinery does not exceed twenty-five lakh rupees
Small enterprise: investment in plant and machinery is more than twenty-five lakh rupees but does not exceed five crore rupees
Medium enterprise: investment in plant and machinery is more than five crore rupees but does not exceed ten crores rupees.
Short Answer Type Questions
Question. Write the objective of Marketing Assistance scheme?
- To enhance marketing capabilities and competitiveness of the MSMEs.
- To showcase the competencies of MSMEs
- To update MSMEs about the prevalent market scenario and its impact on their activities.
- To facilitate the formation of consortia of MSMEs for marketing of their products and services.
- To provide platform to MSMEs for interaction with large institutional buyers.
- To disseminate/propagate various programmes of the Government.
- To enrich the marketing skills of the micro, small and medium entrepreneurs
Question. Write any two objectives of establishment of NABARD.
♦ It has been adopting a multi-pronged, multi-purpose strategy for the promotion of rural business enterprises in the country.
♦ Apart from agriculture, it supports small industries, cottage and village industries, and rural artisans using credit and non-credit approaches.
♦ It offers counselling and consultancy services and organizes training and development programmes for rural entrepreneurs
Question. Define the role of small business in the following area:
a) Variety of products
c) Industry output & export
b) Balance development
a) Variety of products: Small industries in our country supply an enormous variety of products which include mass consumption goods, readymade garments, hosiery goods, stationery items, soaps and detergents, domestic utensils, handlooms, handicrafts etc
b) Industry output & export: Small industries in India account for 95 per cent of the industrial units in the country. They contribute almost 40 per cent of the gross industrial value added and 45 per cent of the total exports (direct and indirect exports) from India.
c) Balance development: The contribution of small industries to the balanced regional development of our country. Promotion of small scale industries and rural industrialization has been considered by the Government of India as a powerful instrument for realising the twin objectives of ‘accelerated industrial growth and creating additional productive employment potential in rural and backward areas
d) Customization: Small industries are best suited for customised production. i.e. designing the product as per the tastes/ preferences/needs of individual customers
Long Answer Type Questions
Question. What are the incentives given by Govt. to the Industries set up in hurry, backward and rural areas
Incentives given by the govt to the industries set up in hurry, backward and rural area are as follows:
Every state offers developed plots for setting up of industries. The terms and conditions may vary. Some states don’t charge rent in the initial years, while some allow payment in instalments.
Power is supplied at a concessional rate of 50 per cent, while some states exempt such units from payment in the initial years.
Water is supplied on a no-profit, no-loss basis or with 50 per cent concession or exemption from water charges for a period of 5 years.
In all union territories, industries are exempted from sales tax, while some states extend exemption for 5 years period.
Most states have abolished octroi.
Units located in backward areas get preferential treatment in the matter of allotment of scarce raw materials like cement, iron and steel etc.
Subsidy of 10-15 per cent is given for building capital assets. Loans are also offered at concessional rates.
Some states encourage setting up of industrial estates in backward areas.
Exemption from paying taxes for 5 or 10 years is given to industries established in backward, hilly and tribal areas
Question. Board of Directors of ‘’Bio Pure water Ltd.’’ decides to set up its first unit in the hilly area of Himachal Pradesh Company requires Rs. 3 crores for it and Rs. 50 Lakhs for working capital. The company has earned marked15% of its profit for Educational and Health needs of its employees and their family members.
(a) The above company comes under which category as per MSMEDAct 2006.
(b) Write any one commercial reason for setting up of unit in the hilly region.
(c) According to you, what are the options available to the company for meeting its long term and short term needs.
(d) what are the values promoted by the company.
[Hints: Small scale Industry, Cheap price of Land and Labour, Equity share Capital and Loans from Bank, Balanced Regional Development, Motivation to employees, Employment Ganeration and upliftment of rural areas]
a) It comes under small scale industry. In the case of enterprises engaged in the manufacture or production of goods pertaining to any industries specified in the first schedule to the Industries (Development and Regulation) Act, 1951, Small enterprise: investment in plant and machinery is more than twenty-five lakh rupees but does not exceed five crore rupees
b) The Board of Director decides to set up its first unit in hilly area of Himachal Pradesh because of cheap price of land and labour
c) The company for meeting its long term and short term needs should opted for equity source of fund and by loans from bank
d) Values promoted by the company are as follows:
1. Balance Regional Development: The company set up its first unit in hilly area of Himachal Pradesh, thereby helping development of the region
2. Motivation to employees: The company by providing educational and health needs of its employees and their family members , motivates the employees
3. Generation of employment: The company set up its first unit in hilly area of Himachal Pradesh because of cheap price of land and labour , thereby increasing the employment opportunity
4. Upliftment of rural area: The company has earned marked15% of its profit for Educational and Health needs of its employees and their family members of hilly region which in turn improves the standard of living and achieves upliftment of the rural area
Question. SSI’s are at distinct disadvantage as compared to LSI’s. Discuss some important areas of SSI which need support
Answer : SSi’s are at distinct disadvantage as compared to LSI’s. Competition is not only from medium and large industries, but also from multinational companies which are giants in terms of their size and business volumes. It is difficult to withstand the quality standards, technological skills, financial creditworthiness, managerial and marketing capabilities. There is limited access to markets of developed countries due to the stringent requirements of quality certification like ISO 9000. These organisations have to depend excessively on middlemen, who at times exploit them by paying low price and delayed payments. They lack the necessary infrastructure for direct marketing
They need marketing support which can be done by following ways:
♦ Organising International Technology Exhibitions in Foreign Countries by NSIC and Participation in International Exhibitions/Trade Fairs
♦ facilitate them in exploring new business opportunities in emerging and developing markets
♦ helps in promoting trade, establishing joint ventures, technology transfers, marketing arrangements and image building of Indian MSMEs in foreign countries
♦ participation of Indian MSMEs in the select international exhibitions and trade fairs.
♦ Participation in such events exposes MSMEs to international practices
Organising Domestic Exhibitions and Participation in Exhibitions/Trade Fairs in India
♦ help the MSMEs in enhancing their marketing avenues by way of capturing new markets
♦ expanding existing markets
Support for Co-sponsoring of Exhibitions Organised by other Organisation and industry Associations/Agencies
♦ This support would be in the form of co-sponsoring of the event by NSIC. In order to apply for co-sponsoring of an event by NSIC, the applicant organisation/agency must fulfill the centre criteria/conditions
♦ Participation in these programmes enables MSMEs to know the requirements of bulk buyers on the one hand and help the bulk buyers to know the capabilities of MSMEs for their purchases.
Intensive Campaigns and Marketing Promotion Events
♦ To disseminate information about the various schemes for the benefit of the micro, small and medium enterprises.
♦ They are also facilitated to enrich their knowledge regarding latest developments, quality standards etc. and improve the marketing potential of their products and services.
Other Support Activities
♦ Development of Display Centres, show windows and hoarding etc., for promoting products and services of MSMEs.
♦ Printing of Literature, Brochures and Product-specific catalogues and CDs etc., and preparation of short films for disseminating information.
♦ Development of website/portal for facilitating the marketing of MSME products and services
♦ Development and dissemination of Advertising and Publicity material about various programs/schemes for MSME sectors and events.
♦ Preparation and Upgradation of MSME Manufacturers/ Suppliers/ Exporters Directory.
♦ Documentation of the success stories of MSMEs.
♦ Conducting studies to explore and assess new markets/ businesses and product ranges for both domestic and international markets.
♦ Hosting international delegations and networking events