Sample Question Paper (2023-24)

Subject: Entrepreneurship (066)

Class: XII
Time: 3 Hours Max Marks: 70
General Instructions:
1. This question paper contains 34 questions.
2. The question paper contains 4 sections - A, B, C and D
1.1. Section A contains multiple choice questions
1.2. Section B - 2 marks; Answers to these questions may be from 30-40 words.
1.3. Section C - 3 marks; Answers to these questions may be from50-75 words.
1.4. Section D - 5 marks; Answers to these questions may be from120-150
3. Internal choice is given in the paper, there is no overall choice.
PART A
Q.No. Marks
1. Aryan an entrepreneur wanted to launch his own pen in the market. He 1
found that many types of pen were already available in the market. What
should be determined by Aryan if the pen is already available in the
market?
a. Market demand for the product
b. Price comparison of similar products
c. Competitive advantage of the product
d. Reason for introducing the same product or service
2. Fusion Ltd. wants to promote its luxury fashion brand. They organize an 1
exclusive fashion show where they showcase their latest collection to high-
profile guests and media. Which type of promotional strategy is “Fusion
Ltd” using?
a. Personal selling
b. Public relations
c. Advertising
d. Sales promotion
3. Abex Company is a manufacturing company that produces and sells 1
electronic devices. The company purchases raw materials, processes
them into finished products, sells them to customers on credit, and
receives cash from the customers. Which statement best describes the
operating cycle of Abex Company?
a. The operating cycle of Abex Company includes the duration between
buying raw materials and receiving cash from customers.
b. The operating cycle of Abex Company only involves the length of time
taken for procurement of goods and realisation of sales revenue.
c. The operating cycle of Abex Company is shorter compared to a trading
concern as there is no manufacturing or conversion involved.
d. The operating cycle of Abex Company is shorter compared to a trading
concern, resulting in less capital requirement.
4. The definition “Sole Proprietorship initiated and operated by an individual 1
who carries all financial and administrative responsibilities, employing
such assistants as many as necessary” was given by:
a. W.R. Basset
b. Edward Elbourne
c. ET Elbourne
d. John A . Shubin
5. Varun and Arun are friends and both of them know the art of weaving 1
carpets. They started their manufacturing business of making carpets.
They introduced many intricate designs in the carpet, which was highly
appreciated by everyone. Identify the form of business organisation
mentioned above.
a. Sole proprietorship
b. Partnership
c. Private company
d. Public company
6. Saumya is planning to register a trademark for her innovative tech 1
gadget. She wants to ensure that the chosen trademark is not copied by
others and matches the present time. What quality of a good brand name
should she consider?
a. Pleasing and impressive when uttered.
b. Neither obscene, negative, offensive, nor vulgar.
c. Contemporary and capable of being registered and legally protected.
d. Adaptable to different advertising media and languages.
7. Ramandeep is a technical entrepreneur who started developing 1
interactive websites of businesses. Due to lot of competition in this field
he is experiencing a decline in the demand. He wishes to understand his
revenue position as compared to his investment. Which one of the
following combinations would help him in assessing the profitability of his
business? (CBSE QP 2022-23)
(i) Economic Order Quantity
(ii) Return on Investment
(iii) Return on Equity
(iv) Break-Even analysis
(a) (i) and (iii)
(b) (iii) and (iv)
(c) (ii) and (iii)
(d) (i) and (iv)
8. Given below are some tools of promotion mix. Match them correctly with 1
their objectives.
Column I Column II
A. Advertising (i) To reach a mass audience with
a specified message.
B. Personal selling (ii) Dealing with individual
customers
C. Sales promotion (iii) To appeal to a mass audience
to create awareness.
D. Publicity (iv) To stimulate short-term sales.
 Codes
A B C D A B C D
(a) (iii) (ii) (iv) (i) (b) (ii) (iii) (i) (iv)
(c) (i) (ii) (iv) (iii) (d) (iv) (ii) (i) (iii)
9. Current assets of a firm are: Cash = Rs.50,000, Debtors = Rs.75,000, 1
Inventory = Rs.1,00,500. On the basis of this, the Gross working capital
will be:
a. 1,10,500
b. 2,25,500
c. 2,30,500
d. 2,50,000
10. Assertion (A): Generating of ideas is relatively easy, but can become a 1
wild goose chase.
Reason (R): All ideas do become sound business opportunity.
(a) Both Assertion (A) and Reason (R) are true and Reason (R) is the
correct explanation of (A)
(b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the
correct explanation of (A)
(c) Assertion (A) is true but Reason (R) is false.
(d) Assertion (A) is false but Reason (R) is true.
11. Company X is implementing ABC analysis for its inventory control. They 1
have categorized their inventory into three groups: A, B, and C items.
Which statement correctly describes the characteristics of A items?

a. A items are the least expensive and contribute the least value to the
company.
b. A items constitute 30% of SKUs and contribute 15% of the total value.
c. A items require close monitoring and constitute 20% of SKUs but
contribute 80% of the total value.
d. A items do not require any attention or controls as their cost is
relatively low.
12. Assertion (A): Logos are critical aspect of business marketing. 1
Reason (R): Company’s major graphical representation, a logo anchors
company’s brand.
(a) Both Assertion (A) and Reason (R) are true and Reason (R) is the
correct explanation of (A)
(b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the
correct explanation of (A)
(c) Assertion (A) is true but Reason (R) is false.
(d) Assertion (A) is false but Reason (R) is true.
13. Assertion (A): One cannot imagine a world without money. 1
Reason(R): Every day’s life and every activity of human being is dependent
upon money.
(a) Both Assertion (A) and Reason (R) are true and Reason (R) is the
correct explanation of (A)
(b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the
correct explanation of (A)
(c) Assertion (A) is true but Reason (R) is false.
(d) Assertion (A) is false but Reason (R) is true.
14. i. Statement 1: Market assessment involves evaluating the size of the 1
target market and the preferences of consumer groups.
 ii. Statement 2: Assessing the supply position helps entrepreneurs
understand the competitive landscape and anticipate future supplies from
potential entrants.
iii. Cost advantage can be achieved by considering factors such as
transportation delays, wastage, and storage.
iv. Project innovation and changes are irrelevant factors in the market
assessment process.

a. Statement 1 and Statement 2

b. Statement 2 and Statement 3
c. Statement 1 and Statement 3
d. Statement 1 and Statement 4
15. Rahul is a tech enthusiast who wants to start a business in the 1
technology sector. He believes that the key to success lies in
understanding the emerging trends in the industry. He spends a
significant amount of time going through various industry publications,
trade association sites and keeping up with the latest news and articles
related to technological advancements. Which type of trend is Rahul
primarily focusing on?
a. Talk trend
b. Watch trend
c. Think trend
d. Read trend
16. Rohan, an aspiring entrepreneur, recently had a creative idea for a new 1
mobile application. He started conducting market research to understand
the potential demand for his app. In which step of the creativity process is
Rohan currently engaged?
a. Idea germination
b. Preparation
c. Incubation
d. Illumination
17. DEF Corp., a global technology company, relies heavily on international 1
trade for sourcing raw materials and selling its products. The company
faces challenges due to the ongoing trade disputes and tariffs imposed
between major trading nations. These trade barriers impact DEF Corp.’s
supply chain, pricing, and profitability. Which element of the PESTEL
macro environment does this scenario represent?
a. Political
b. Economic
c. Social
d. Technological
18. Assertion (A): Excess funds cannot damage the financial fortune of a 1
business.
Reason (R): Decisions regarding funds must be taken with careful planning.
(a) Both Assertion (A) and Reason (R) are true and Reason (R) is the
correct explanation of (A)
(b) Both Assertion (A) and Reason (R) are true and Reason (R) is not the
correct explanation of (A)
(c) Assertion (A) is true but Reason (R) is false.
 (d) Assertion (A) is false but Reason (R) is true.
PART B
19. The process of creativity involves five steps. Explain the second step. 2
OR
Creativity is important to entrepreneurs. Analyse the statement.
20. Most marketers give a “name” (brand) to their products. Analyse the 2
statement.
21. What are the main functions of Sales Strategy? 2
22. Discuss any two disadvantages of franchising to the franchisee. 2
OR
List any four qualities of a good brand.
23. Prashant is an artisan. He loves to experiment on different types of 2
potteries and clay items. He became very famous in the local area and was
visited by the local block development officials to discuss the additional
opportunities related to potteries. They formed a team in order to promote
export quality potteries and other items. Prashant established himself as
an artisan and started helping and giving advise to others small artisans.
Identify and explain the 'idea field' that helped Prashant to engage himself
in the artisan industry.
24. Find out EOQ and number of orders to be placed during the year from the 2
following information.
(i) Annual consumption =120 units
(ii) Buying cost per order = ₹ 20
(iii) Price per unit = ₹ 100
(iv) Storage cost as percent of average inventory 12%

OR
The following figures are extracted from the balance sheet of Wi-Phi Ltd.
Net profit after tax: Rs.4,00,000
Net profit before tax: Rs.2,80,000
Total Invested (Owned + Borrowed): Rs.4,00,000
Own funds: Rs.2,00,000
Calculate Return on Equity for Swadesha Ltd.
PART C
25. Source: Entrepreneur magazine: May 28, 2021 3
Dinesh and Vivek have been longtime friends since their IIT Kharagpur and
P&G days. Back in 2016, when they met after a few years, both discussed
their concerns about how inseparable children and technology/screens are
today! Dinesh’s son was four and Vivek was a new dad. The duo discussed
a few ideas of how they could merge tactile and digital play. Together, they
pulled a team of five and after extensive research, zeroed in on Augmented
Reality! Talking about the idea behind what we today know as PlayShifu,
Vivek Goyal its CEO and Co-Founder says, “A child’s brain development
in the early years (3-11 years) is centered around play and entertainment.
But today, children spend over four hours every day on screens (mobiles,
tablets and laptops). And that’s when it became clear that screen time had
to be more hands-on.” This idea opened up unlimited possibilities to merge
learning and play. Today, PlayShifu operates at an intersection of three
industries: Toys, Gaming and Education. Their first product and also the
bestseller is Orboot Earth- the first-ever Augmented Reality globe for kids.
 The team did a very successful Kickstarter campaign that gave them
backers from 100 countries and $100k to start their journey with Orboot.
After lockdown the business grew 600% in April, 2020.

Read the above passage carefully and answer the following

questions:
1. Name the form of business discussed above in the passage.
2. Based on the above passage, list the characteristics of business.
3. ‘PlayShifu’ can be categorized into which type of economic activity?
26. Sheetal and Ruchi were friends. They got trained in one of the best sangeet 3
academy of the town. They decided that they would open their sangeet
academy once their course was over. Sheetal had indeed become the
proud owner of an academy and turned into a successful entrepreneur in
a short span of time. She has been consistently earning good profit from
her enterprise and wishes to open new academies in other areas. Sheetal
contacted Ruchi and discussed her plans with her. Ruchi who was already
doing the business from her home, readily agreed to finance Sheetal’s
proposal and also wanted partnership in the business.
A. List two benefits of remaining a sole proprietor by Seema. ( ½ Marks + ½
Marks)
B. Explain two benefits and two limitations of partnership.
27. This concept is an identifying symbol for any product or business. It can be 3
any distinctive design, mark, sign which stands associated with the
enterprise. Enlist any three purpose of this concept.
28. Source- Entrepreneur magazine – May, 2021 3
The journey of Rage coffee started with a simple thought to solve a
personal problem – How to get a great tasting coffee at a reasonable cost,
without shelling out too much money in cafes or spending much time
brewing one. “I started conducting surveys and identified that the coffee
market had huge potential and many unserved gaps. In fact, there was
hardly any lifestyle aspirational brand built around such an emotional
subject that is ‘coffee’. As the category remained largely undeserved, was
devoid of any real innovation, and underpenetrated online, it provided us
with a unique opportunity to strike a balance between affordability,
consumption and quality that was missing”, shares Bharat Sethi, Founder,
Rage Coffee.
That is when he decided to focus on men, ingredients, formulations,
machines, manufacturing techniques/method, packaging, money and
direct-to-consumer distribution to bring a premium quality product with a
unique coffee experience to everyone. He used feedback, data and
engaged in extensive R & D to deliver in premium quality coffee for all.
Rage Coffee employees an Omni channel approach, selling 50% online,
and the rest offline. For online, about 75% of sales are through its website
and 25% through e-commerce platforms. Rage Coffee is available on all
major online platforms in India. The products are available in more than
600 retail outlets.

A. Keeping in mind this article, state 5Ms of financial business plan that
Bharat Sethi focused on to bring a premium quality product to the market.
B. What three elements were missing in Coffee business that was
capitalized by Mr. Sethi?
 C. Which plan describes the strategies related to how a product/service
will be distributed?
29. What do you understand by Capital Market? What is its importance? 3
OR
The whole meaning and direction of a company can be explained through
its brand management strategy, an entrepreneur should be very careful in
deciding its brand strategy. Discuss any three such brand strategies or its
types.
PART D
30. The term to describe the merger depends on the economic function, 5
purpose of the business transaction and relationship between the merging
companies. Describe those terms to describe the types of mergers.
OR
Distinguish between ‘merger’ and ‘acquisition’ as forms of external
expansion. Explain the ways in which one business can acquire another.
(CBSE SQP)
31. What do you understand by venture capital? Explain its features. 5
32. Business is a continuous human economic activity with an objective to 5
earn profit. It exhibits few essential characteristics. Discuss.
33. Calculate return on investment and return on equity (annually) from the 5
following information. Shriya has started her boutique. She spent total of
₹1,50,000 to open the boutique, of which her own money was ₹70,000 and
borrowed money was ₹80,000. Interest rate per annum is 7%. Sales
revenue per month is ₹80,000. Cost of goods sold is ₹30,000 per month.
Fixed expenses is ₹30,000 (salary 20,000, rent and utility 10,000),
depreciation 3,000 and tax @ 14%.
34. To fulfil all the objectives of operational plan, entrepreneur specifically 5
pays attention to some elements of the plan. Analyse five such elements.