Practicing Success

Target Exam

CUET

Subject

Economics

Chapter

Macro Economics: Introduction

Question:

Which of the following is NOT a risk or uncertainty faced by an entrepreneur?

Options:

Not getting high enough price for the goods

Fall in the profits

Face high demand

Loss of capital invested

Correct Answer:

Face high demand

Explanation:

The correct answer is option 3: Face high demand

Here’s why:

  • Not getting high enough price for the goods: This is a risk as the entrepreneur may not be able to sell their products at a price high enough to cover their costs or generate sufficient profits.

  • Fall in profits: Entrepreneurs face the risk of experiencing a decline in profits due to various factors such as increased competition, rising costs, or changes in market demand.

  • Loss of capital invested: This is a significant risk for entrepreneurs, as they may lose the money they have invested in their venture if it fails or does not generate the expected returns.

However, facing high demand is typically not considered a risk for entrepreneurs; in fact, it's often a desirable outcome as it indicates strong market interest in their products or services. While managing high demand may bring its own challenges, it's generally seen as a positive scenario for entrepreneurial success.