2 Marks Question

Question 12 Marks

The following information relates to the newly established Boutique – ‘The Pearl’:
● Total capital invested - ₹ 40,00,000 out of which ₹ 20,00,000 is a bank loan at 15% per annum
● Net Profit after Tax is ₹ 6,00,000
Calculate Return on Equity for The Pearl Boutique.

Answer

$\begin{aligned} \text { Return on Equity } & =\frac{\text { Net Profit after Tax }}{\text { Total Equity }} \times 100 \\ & =\frac{6,00,000}{20,00,000} \times 100 \\ & =30 \%\end{aligned}$

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Question 22 Marks

Tic Tac Electricals Ltd. manufactures switches and plugs in an industrial area in the state of Haryana. On an average, they manufacture 2500 switches per day. Their raw material supplier is based in Punjab and takes 5 days to deliver the requirement once the order is received.
Estimate the reorder level for Tic Tac Electricals Ltd.

Answer

$\begin{aligned} \text { Reorder level } & =\text { Lead time } \times \text { Daily requirement } \\ & =5 \times 2500 \\ & =12500 \text { units }\end{aligned}$

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Question 32 Marks

Describe the ‘elevator pitch’ format of business plan used by entrepreneurs. How is it different from an ‘internal operational’ plan?

Answer

Elevator pitch 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 partners.
Internal operational plan is used by the management for detailed planning and may not be of any interest to funders or customers.

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Question 42 Marks

Zakir is keen on giving up his job and starting a new fitness industry business. He has to choose among fitness drinks, gym equipment & fitness gear.
Zakir decided to spend more time in the gym inside his apartment complex and in nearby localities, especially on weekends and late evenings, to observe the people and understand their requirements.
He took the membership of Gym Community Trade Association through which he got the advantage of their social networking tools like Instagram page, gym websites and community Whatsapp groups. He conducted an online survey to ascertain the viable product for his business idea. The response so collected gave him the clarity that he should go with fitness gear.
By quoting lines from the above passage, identify the ways of trend spotting used by Zakir.

Answer

The ways of trend spotting used by Zakir are:
• Watch trends: ‘Zakir decided to spend more time in the gym inside his apartment complex and in nearby localities. He simply observed the people.’
• Talk trends: ‘He conducted an online survey to ascertain the viable product for his business idea.’

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Question 52 Marks

Discuss briefly the two forms of ‘synergy’ that accrue to the merging firms.

Answer

Synergy can take the following forms:
• Operating synergy: The cost savings that come through economies of scale or increased sales and profits. It leads to the overall growth of the firm.
• Financial synergy: This is the result of financial factors such as lower taxes, higher debt capacity or better use of idle cash.

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Question 62 Marks

Refer to the images given below:

(I) Identify the type of enterprise growth strategy adopted in the two scenarios indicated in the aforesaid image.
(II) List the two forms of the growth strategy indicated.

Answer

(I) Merger is the type of enterprise growth strategy adopted in the two scenarios.
(II) Two forms of the growth strategy indicated are:
(i) Absorption
(ii) Amalgamation

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Question 72 Marks

Read the following text carefully:
Rohit is a trained plumber and has worked for a hardware shop for more than 3 years. He is very popular in the area and people generally request his employer to send Rohit for their repair and maintenance tasks.
Rohit is planning to start a business of his own where he will directly reach his clients upon a phone call. He will provide services instantaneously within 15 minutes of the request received. His present clients may put in a positive word for him among their friends and neighbors which can help his business grow. On the basis of the given text identify, giving reasons, any two elements of business opportunity.

Answer

Two elements of business opportunity are:
• Assured market scope: He is very popular in the area and people generally request his employer to send Rohit for their repair and maintenance tasks.
• Practicability of idea: He will provide services instantaneously within 15 minutes of the request received.

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Question 82 Marks

Differentiate between a basic idea and post scanning idea.

Answer

The initial spotting of ideas i.e. basic idea is of a random nature, whereas, the development of ideas after scanning the environment i.e. post scanning idea is a more purposeful activity. The former is an experiential process while the latter is a strategic process.

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Question 92 Marks

Explain ‘product identification’ as the first step in idea and opportunity assessment.

Answer

An idea should lead the entrepreneur to a definite product/service which he/she can sell. So, the first step is to obtain a concept of the product or service suggested by one idea. If the product is already available in the market, then this assessment should identify the reason for re-introducing the same.

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Entrepreneurship 2 Marks Question

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