Chapter Exam

Chapter 6: Setting up a Business — Online MCQ Test

Q: What does MSME stand for?

Answer: A. Micro, Small and Medium Enterprises — MSME is the abbreviation for Micro, Small and Medium Enterprises. It is used to classify enterprises based on investment and other criteria.

Q: Which organisation is mainly responsible for providing technical and managerial support to small-scale industries at the district level?

Answer: B. DIC — The District Industries Centre (DIC) provides support, guidance, and assistance to entrepreneurs at the district level.

Q: Which of the following is the first practical step in setting up a business?

Answer: B. Identifying a business idea and opportunity — A business begins with identifying a viable idea or opportunity. Other activities come only after planning and establishment.

COMMERCE · CLASS 12 INTERMEDIATE 2 YEAR · Telangana State Board

Practice Chapter 6: Setting up a Business with a free chapter-wise online MCQ test for Telangana State Board CLASS 12 INTERMEDIATE 2 YEAR COMMERCE. This chapter covers: This chapter details steps for starting a business MSME classifications registration processes government incentives support agencies DIC SIDA and NSIC roles.. AI-generated questions from basic to board-exam level, with instant results and explanations.

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Chapter 6: Setting up a Business — Important Questions & Answers (FAQ)

Frequently asked questions from Telangana State Board CLASS 12 INTERMEDIATE 2 YEAR COMMERCE — Chapter 6: Setting up a Business, with answers and explanations. These are sample questions; the exam has its own separate question set.

What does MSME stand for?

A. Micro, Small and Medium Enterprises ✓
B. Manufacturing, Service and Marketing Enterprises
C. Modern, Special and Medium Establishments
D. Micro, Service and Manufacturing Entities

Answer: A. Micro, Small and Medium Enterprises
MSME is the abbreviation for Micro, Small and Medium Enterprises. It is used to classify enterprises based on investment and other criteria.

Which organisation is mainly responsible for providing technical and managerial support to small-scale industries at the district level?

A. RBI
B. DIC ✓
C. SEBI
D. NSE

Answer: B. DIC
The District Industries Centre (DIC) provides support, guidance, and assistance to entrepreneurs at the district level.

Which of the following is the first practical step in setting up a business?

A. Launching advertisements
B. Identifying a business idea and opportunity ✓
C. Preparing the annual report
D. Paying dividend to shareholders

Answer: B. Identifying a business idea and opportunity
A business begins with identifying a viable idea or opportunity. Other activities come only after planning and establishment.

Two entrepreneurs set up units with the same product. One unit is registered and eligible for subsidies, while the other is not. What is the most likely reason for the difference?

A. The unregistered unit cannot earn profit at all
B. Registration makes a unit eligible for government benefits and incentives ✓
C. Registration increases competition automatically
D. The registered unit need not follow any rules

Answer: B. Registration makes a unit eligible for government benefits and incentives
Registered enterprises can access various concessions, subsidies, and official support. Unregistered units may not receive such benefits.

Which of the following is the most accurate reason why government encourages MSMEs?

A. They reduce the need for all other industries
B. They promote employment and balanced industrial development ✓
C. They completely replace agriculture
D. They eliminate the need for taxation

Answer: B. They promote employment and balanced industrial development
MSMEs help generate employment, encourage entrepreneurship, and support balanced regional industrial growth.