Why should an entrepreneur first conduct a small market test of a product?
Answer and explanation
Correct answer: To obtain feedback before risking a major loss
A small market test lets an entrepreneur observe responses to the product, price, packaging, and service before making a large commitment. Feedback can reveal needed changes and limit the cost of failure. The aim is controlled learning, not confusing customers, hiding costs, or advertising without purpose. Therefore, option A correctly explains the value of a small market test.
Frequently asked questions
What is the correct answer to this question?
To obtain feedback before risking a major loss
Why is this the correct answer?
A small market test lets an entrepreneur observe responses to the product, price, packaging, and service before making a large commitment. Feedback can reveal needed changes and limit the cost of failure. The aim is controlled learning, not confusing customers, hiding costs, or advertising without purpose. Therefore, option A correctly explains the value of a small market test.
Which subject and chapter does this question cover?
This is a Class 11 Business Studies question. Chapter: MSME and Business Entrepreneurship. Topic: Entrepreneurship Development.
