Extra questions from all

modules
Mod 1

Discuss the functions of an entrepreneur (8 marks)

1. Entrepreneurial Functions:
These are core tasks that define entrepreneurship:
• Risk Bearing: Entrepreneurs take on the uncertainty of starting and running a
business, risking their money, time, and resources. The success or failure of the
business depends on how well they handle this risk.
• Organizing: Entrepreneurs bring together resources like labor, capital, and
raw materials and coordinate them to produce goods or services efficiently.
• Innovation: Entrepreneurs introduce new ideas, products, or processes to the
market. This could involve improving existing products or creating something
entirely new.
2. Managerial Functions:
These involve running and managing the business:
• Planning: Entrepreneurs create a roadmap for the business by setting goals,
determining strategies, and making decisions about the future.
• Organizing: Similar to the entrepreneurial function, but here, it’s about
creating structures and assigning roles within the company to ensure smooth
operations.
• Staffing: Entrepreneurs hire, train, and manage employees, ensuring the right
people are in the right positions to achieve business goals.
• Directing: Entrepreneurs lead and motivate employees, guiding them toward
achieving company objectives.
• Controlling: Entrepreneurs monitor performance and make adjustments to
ensure the business stays on track with its goals.

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 3. Promotional Functions:
These involve setting up the business:
• Identification and Selection of Business Idea: Entrepreneurs find and
choose a viable business idea that they believe can succeed in the market.
• Preparation of Business Plan: They create a detailed plan outlining how the
business will operate, including goals, strategies, and financial projections.
• Requirement for Finance: Entrepreneurs figure out how much money they
need and where they will get the funds, whether through loans, investors, or
personal savings.
4. Commercial Functions:
These are practical activities involved in running the business:
• Production/Manufacturing: Entrepreneurs oversee the production of goods
or services, ensuring that they are made efficiently and meet quality standards.
• Marketing: They promote and sell the product or service, conducting market
research and using strategies to attract customers.
• Accounting: Entrepreneurs manage the financial aspects of the business,
keeping track of income, expenses, and profits, ensuring the business remains
financially healthy.

Mod 2

2.Evaluate the various types of Business Model(8)

1. Freemium Model
• Definition: Offers basic services for free but charges for premium features.

• Example: Spotify - You can listen to music for free with ads, but you pay to
remove ads and get extra features like offline listening.
2. Subscription Model

• Definition: Customers pay a recurring fee (monthly/yearly) to access a

service.

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 • Example: Netflix - You pay every month to watch movies and TV shows from
its library.
3. E-commerce Model

• Definition: Businesses sell products directly to customers online.

• Example: Amazon - It’s an online platform where you can buy a wide range of
products.
4. Marketplace Model

• Definition: The business connects buyers and sellers and earns from service
fees or commissions.
• Example: Airbnb - It connects hosts who rent out properties to travelers,
earning through service fees.

5. Direct Sales Model

• Definition: Products are sold directly to consumers, often through personal
sales or demonstrations.
• Example: Tupperware - Their kitchen products are sold via personal in-home
demonstrations.

6. Advertising Model
• Definition: Offers free services but earns revenue from advertisers who pay
to reach the service’s users.

• Example: Google - Provides free search services and generates income by

showing targeted ads.
7. Licensing Model

• Definition: A company allows other businesses to use its brand, logo, or

intellectual property for a fee.

• Example: Disney - Licenses characters (like Mickey Mouse) to other

companies to use on products.
8. Franchise Model

• Definition: A business allows others to run a copy of its business using its
brand and system, usually for a fee.

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 • Example: McDonald’s - Entrepreneurs can open and operate McDonald’s
outlets by following the company’s business model.
9. Product-as-a-Service (PaaS) Model

• Definition: Customers pay for the usage of a product, not owning it, often
bundled with services like maintenance.
• Example: Rolls-Royce - They provide engine maintenance and only charge
based on how much the engine is used.

10. Crowdsourcing Model

• Definition: A business raises funds or solves problems by gathering
contributions from many people, often online.

• Example: Kickstarter - Creators raise funds for projects by getting small

contributions from a large group of people.

3. Advantages of business plan(3)

1. Analysis of Ideas on a Piece of Paper:

Advantage: Allows for systematic evaluation and refinement of business

ideas, helping to identify strengths, weaknesses, and potential challenges
before implementation.

2. Help in Convincing Others:

Advantage: Provides a structured document that can persuade investors,

partners, and other stakeholders of the viability and potential of the
business.

3. Reduction in Emotional Bias:

Advantage: Encourages objective analysis by focusing on data and logical

reasoning rather than personal feelings or assumptions.

4. Provide SWOT Analysis:

Advantage: Offers a comprehensive assessment of the business’s

Strengths, Weaknesses, Opportunities, and Threats, which aids in
strategic planning and decision-making.

5. Justify One’s Ideas/Plans:

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 Advantage: Helps to articulate and validate the rationale behind business
decisions and strategies, making it easier to defend and adjust plans as
needed.

6. Develop Consistent Strategy:

Advantage: Ensures that all aspects of the business are aligned with a
coherent strategy, leading to more focused and effective execution.

7. Achieve One’s Commitment:

Advantage: Provides a clear roadmap and goals, which helps to maintain

focus, track progress, and stay committed to achieving business
objectives.

4.Business continuity management (3)

Business Continuity Management (BCM) is the process by which a business
prepares for and ensures its ability to continue operating during and after a
disruption, such as natural disasters, cyberattacks, or equipment failures. BCM
helps minimize the impact of these disruptions on the business and ensures
critical functions can continue.

It involves:

1. Risk Assessment: Identifying potential threats to the business.

2. Business Impact Analysis: Understanding which areas are most vulnerable
and critical.

3. Recovery Planning: Developing strategies to restore operations quickly.

BCM ensures a business can recover and maintain essential services in the face
of unexpected challenges.

Mod 3

The marketing process

The marketing process involves five key steps that help businesses understand
their customers and deliver value effectively:

1. Understanding the Marketplace and Customer Needs and Wants

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 • The first step is to research and understand the market environment,
customer needs, preferences, and behaviors. It involves identifying gaps or
problems customers face and figuring out how the business can address them.

2. Designing a Customer-Driven Marketing Strategy

• Based on the understanding of the market, businesses create a strategy to
meet customer needs. This includes selecting a target market and determining the
best way to satisfy that market through value propositions and positioning.
3. Constructing an Integrated Marketing Plan

• This step involves developing a detailed plan that outlines how the business
will deliver value to customers. It includes the marketing mix (Product, Price,
Place, Promotion) and other tactics to ensure consistency and coordination across
all marketing activities.
4. Building Profitable Relationships

• After the marketing plan is executed, the focus shifts to building strong, long-
term relationships with customers. This involves delivering on promises, ensuring
customer satisfaction, and using customer relationship management (CRM) tools
to engage with customers and build loyalty.

5. Capturing Value from Customers

• Finally, businesses capture value by generating sales and building customer
loyalty. This leads to higher profits and long-term success through customer
retention, repeat business, and positive word-of-mouth, which contribute to the
company’s overall growth.

This marketing process ensures businesses align with customer needs and build
lasting relationships that drive profitability.

Mod 4

5.Examine the process of estimating the financial

needs of a new venture(6)
1. Estimate Startup Costs:
This includes the initial expenses you’ll need to set up the business:

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 • Legal and Licensing Fees: Costs related to registering the business, getting
permits, trademarks, and any other legal requirements.

• Research and Development: Expenses for developing the product,

conducting market research, and creating prototypes.

• Equipment and Inventory: The cost of purchasing machinery, equipment,

and any inventory needed to start production.

• Office Space and Utilities: Rent, utilities like electricity and internet, and
office supplies.
• Technology and Software: Includes expenses for computers, software, and
other technical requirements.
• Initial Marketing and Branding: Costs for building a brand identity, designing
a logo, creating a website, and initial advertising campaigns.
2. Estimate Operating Costs:
These are the ongoing expenses you’ll need to manage:

• Fixed Costs: Monthly costs that don’t change, such as rent, utilities, salaries,
and insurance.
• Variable Costs: Expenses that fluctuate based on production or sales levels,
like materials, shipping, and commissions.
• Marketing and Sales Expenses: Regular costs for promoting your products
or services.

• Maintenance and Repairs: Costs for maintaining equipment and repairing

any issues.
• Contingency Fund: Setting aside extra money for unexpected expenses.

3. Estimate Cash Flow Needs:

This ensures that you can cover day-to-day expenses:

• Revenue Projections: Estimate how much revenue (sales) you expect to

make, based on market research.
• Break-even Analysis: Calculate how long it will take for your business to
cover its costs and start earning a profit.

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 • Working Capital: Ensure you have enough money to cover daily operational
costs like paying suppliers, managing inventory, and handling customer payments.
4. Determine Financing Requirements:
Summarize how much money you’ll need:

• Total Initial Capital Required: Add up all your startup costs to find out how
much money you need to start.
• Ongoing Operating Capital: Estimate how much money you’ll need to keep
the business running until it becomes profitable.
• Buffer for Unforeseen Expenses: Include extra funds for any unexpected
delays or additional costs.

5. Explore Funding Options:

Think about where you’ll get the money:
• Personal Savings: Using your own money to finance the business.

• Friends and Family: Borrowing money from people you know.

• Bank Loans: Getting a loan from a bank or financial institution.

• Investors: Raising money from venture capitalists, angel investors, or

crowdfunding platforms.
• Grants: Applying for grants that might be available for your specific industry
or business type.
6. Prepare Financial Statements:
Create projections to understand your financial position:

• Income Statement: Shows projected revenue, costs, and profits over time.
• Cash Flow Statement: Estimates your cash inflows and outflows to ensure
liquidity.

• Balance Sheet: Provides a snapshot of your business’s assets, liabilities, and

equity at different stages.
7. Monitor and Adjust:

Regularly check your financials and make changes as needed:

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 • Regularly Review Financials: Compare your actual expenses and revenues
against the projections you made earlier.
• Adjust as Needed: Make changes to your budget or plan based on your
performance or changing market conditions.

6.components of financial plan (6 )

1. Revenue Projections

• Sales Forecast: Estimation of future sales, usually divided by month, quarter,

or year.
• Revenue Streams: Identifies all potential income sources (e.g., product sales,
services, subscriptions).

2. Expense Budget
• Operating Expenses: Regular costs like rent, utilities, and salaries to run the
business.
• Variable Costs: Costs that change with production levels, such as raw
materials.

• Fixed Costs: Costs that remain constant, like lease payments, no matter the
production level.
3. Cash Flow Statement

• Cash Inflows: Money coming into the business from sales, investments, or
loans.
• Cash Outflows: Money going out, such as expenses and loan repayments.

• Net Cash Flow: The difference between cash inflows and outflows, showing
if the business is gaining or losing cash.
4. Profit and Loss Statement (Income Statement)

• Revenue: Total income generated by the business.

• Cost of Goods Sold (COGS): Direct costs for producing goods.
• Gross Profit: Revenue minus COGS.

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 • Operating Expenses: Administrative and other costs subtracted from gross
profit.
• Net Profit: Final profit after all expenses, including taxes, have been
deducted.
5. Balance Sheet
• Assets: What the business owns, like cash, property, and inventory.

• Liabilities: What the business owes, such as loans and accounts payable.
• Equity: The owner’s share of the business, calculated as assets minus
liabilities.
6. Break-Even Analysis
• Break-Even Point: The sales level where the business covers all costs, with
no profit or loss.
• Margin of Safety: The difference between actual sales and the break-even
point, showing how much sales can fall before losses occur.

7. Financial Ratios
• Liquidity Ratios: Measure the ability to pay short-term debts (e.g., current
ratio).

• Profitability Ratios: Assess profit relative to revenue or assets (e.g., net profit
margin).
• Leverage Ratios: Evaluate debt levels compared to equity (e.g., debt-to-
equity ratio).
8. Capital Requirements
• Startup Costs: Initial funding needed to start the business.

• Working Capital: Money needed for daily operations.

• Capital Expenditures: Funds for purchasing long-term assets like equipment.

9. Funding Plan
• Sources of Funding: Describes where money will come from (e.g., loans,
investors).

• Use of Funds: Details how the money will be spent.

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 10. Financial Projections
• Short-Term Projections: Covers the first year with monthly or quarterly
financial forecasts.
• Long-Term Projections: Covers three to five years, showing expected
financial performance.

11. Risk Analysis

• Financial Risks: Potential financial challenges, like cash flow problems or
rising costs.

• Contingency Plans: Backup plans for managing financial risks, such as

emergency funds.
12. Implementation Timeline

• Milestones: Key financial goals, like reaching profitability or securing

funding.
• Timeline: A schedule for achieving these milestones.

Mod 5

7.Examine the salient features of Industrial Relations

Code, 2020.
The Industrial Relations Code, 2020 is a major reform in India’s labor laws,
combining several old laws into one to simplify and improve industrial relations.
Here are the key features:
1. Simplification of Laws
• Combines three key laws: the Trade Unions Act, 1926, the Industrial Disputes
Act, 1947, and the Industrial Employment (Standing Orders) Act, 1946.
• Makes it easier for businesses and workers to understand and comply with
labor laws.

2. Fixed-Term Employment
• Allows fixed-term contracts with the same benefits as permanent employees,
helping employers manage workforce needs while protecting workers.

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 3. Threshold for Layoffs

• Establishments with fewer than 300 workers can lay off employees without
government approval, raising the previous threshold of 100 workers.
• This gives companies more flexibility but also ensures larger firms require
approval for layoffs.
4. Dispute Resolution
• Strengthens mechanisms for resolving industrial disputes, including the
establishment of Industrial Tribunals for quicker resolution.
• Encourages conciliation (negotiation) before going to tribunals, reducing
litigation.

5. Strikes and Lockouts

• Workers must give 60 days’ notice before going on strike in public utility
services.

• Similarly, employers must give notice for lockouts, helping maintain industrial
peace.
6. Trade Union Recognition

• Provisions for recognizing trade unions if they represent 51% of workers,

ensuring better representation in negotiations.
7. Standing Orders

• Applicable to establishments with more than 300 workers, defining terms of

employment to ensure transparency between workers and employers.
8. Grievance Redressal Committee

• Establishes Grievance Redressal Committees in establishments with 20 or

more workers to address employee complaints efficiently.
These features aim to balance the interests of both workers and employers,
making the labor system more flexible while ensuring worker rights.

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