Why is it important to identify revenue sources while designing a business model?
Answer and explanation
Correct answer: Because it shows how the business will earn money
Revenue sources explain how an enterprise will receive money, such as through direct sales, subscriptions, commissions, service fees, or licensing. Identifying them helps assess whether the business model can cover costs and remain financially sustainable. It does not determine customer age, office colour, or eliminate competitors. Therefore, option A correctly states why revenue sources matter.
Frequently asked questions
What is the correct answer to this question?
Because it shows how the business will earn money
Why is this the correct answer?
Revenue sources explain how an enterprise will receive money, such as through direct sales, subscriptions, commissions, service fees, or licensing. Identifying them helps assess whether the business model can cover costs and remain financially sustainable. It does not determine customer age, office colour, or eliminate competitors. Therefore, option A correctly states why revenue sources matter.
Which subject and chapter does this question cover?
This is a Class 11 Business Studies question. Chapter: MSME and Business Entrepreneurship. Topic: Entrepreneurship Development.
