How does understanding demand and supply help an entrepreneur?
Answer and explanation
Correct answer: In making production and pricing decisions
Demand indicates customers’ willingness and ability to buy, while supply indicates the quantity available from sellers. Studying both helps an entrepreneur estimate sales, plan production, manage inventory, and make pricing decisions. The other options do not follow from demand-and-supply analysis, so A is correct.
Frequently asked questions
What is the correct answer to this question?
In making production and pricing decisions
Why is this the correct answer?
Demand indicates customers’ willingness and ability to buy, while supply indicates the quantity available from sellers. Studying both helps an entrepreneur estimate sales, plan production, manage inventory, and make pricing decisions. The other options do not follow from demand-and-supply analysis, so A is correct.
Which subject and chapter does this question cover?
This is a Class 11 Business Studies question. Chapter: MSME and Business Entrepreneurship. Topic: Entrepreneurship Development.
