Question:
What factors are important to be considered while starting a business? Explain.
Answer:
Following factors are considered while starting a new business:
- Selecting the line of business: The first thing to be decided by the entrepreneur is the line and type of business to be undertaken.
- Scale or size of business: After deciding the line of business the businessman must decide whether he/she wants to set up large scale or small scale business.
- Choice of form of business organization: The next decision must be taken is to finalise the form of business i.e., to set up sale, proprietorship, partnership or joint stock company.
- Location of business enterprise: The entrepreneur has to decide the place where the business will be located. Before taking this decision he/she must find out availability of raw materials, power, labour, banking, transportation etc.
- Financial requirement: The businessman must analyse the amount of capital he/ she might require to buy for fixed assets and for working assets). Proper financial planning must be done to determine the amount of funds needed.
- Physical facilities: It includes machinery, equipment building etc. This decision depends upon the size, scale and type of business activities he/she wants to carry on.
- Plant layout: Showing the physical arrangement of machines and equipment needed to manufacture a product.
- Competent and committed workforce: The entrepreneur must find out the requirement of skilled and unskilled workers and managerial staff to perform various activities.
- Tax planning: The entrepreneur must try to analyse the types of taxes, because there are a number of tax laws in the country which affect the functioning of business.
- Setting up the enterprise: After analysing the above mentioned points carefully the entrepreneur can start the business which would mean mobilising various resources and completing legal formalities.
Nature and Purpose of Business
Q 1.
Explain political and legal causes of business risks.
Q 2.
Explain the concept of business.
Q 3.
Can profits be the sole objective of a business? Justify your answer by giving suitable reasons.
Q 4.
What are the functions of commerce?
Q 5.
Define Profession. Discuss its salient features.
Q 6.
"No business is risk free."Do you agree? Justify your answer, mentioning the nature and causes of business risk.
Q 7.
What is business risk? What is its nature?
Q 8.
What are various types of industries?
Q 9.
Explain any two business activities which are auxiliaries to trade.
Q 10.
If you need , to start doing an economic activity to earn livelihood for your family, which one would you like and why?
Q 11.
State the different types of economic activities.
Q 12.
Why is business considered an economic activity?
Q 13.
Explain the characteristics of business.
Q 14.
Explain with examples the various types of industries.
Q 15.
How would you classify business activities?
Q 16.
If one starts a business, which objective will be of utmost importance to you and why?
Q 17.
Define commerce. Discuss its importance in the business world.
Q 18.
What is the role of profit in business?
Q 19.
Compare business with profession and employment.
Q 20.
Why does business need multiple objectives? Explain any five such objectives.
Q 21.
Explain the concept of business risk and its causes.
Q 22.
What are the hindrances in the commerce? Which agencies are used to remove these hindrances?
Q 23.
Distinguish between industry, trade and commerce.
Q 24.
What factors are important to be considered while starting a business? Explain.
Q 25.
Describe the activities relating to commerce.
Q 26.
Compare business with profession and employment.
Q 27.
Distinguish between industry, trade and commerce.
Q 28.
"Risk is the element which makes the business different from other economic activities."Do you agree? Justify your answer.
Q 29.
Explain the economic and social objectives of the business.
Q 30.
"Economic and non-economic activities don't substitute, but complementary to each other."Do you agree? Explain.
Q 31.
What are the functions of commerce?
Q 32.
"Earning of profits is the main objective of a business and other objectives are there to aid it only."Do you agree? Justify your answer.
Q 33.
Differentiate between economic and non-economic activities.
Q 34.
Differentiate between insurable risks and non-insurable risks.