Why should an entrepreneur follow legal rules?
Answer and explanation
Correct answer: To avoid penalties and build a trustworthy enterprise
Legal compliance helps an enterprise operate lawfully and reduces the possibility of fines, suspension, or other penalties. It also supports the trust of customers, workers, and business partners because the enterprise fulfils recognised duties. Confusing customers, hiding expenses, or reducing quality are unethical actions, not purposes of compliance.
Frequently asked questions
What is the correct answer to this question?
To avoid penalties and build a trustworthy enterprise
Why is this the correct answer?
Legal compliance helps an enterprise operate lawfully and reduces the possibility of fines, suspension, or other penalties. It also supports the trust of customers, workers, and business partners because the enterprise fulfils recognised duties. Confusing customers, hiding expenses, or reducing quality are unethical actions, not purposes of compliance.
Which subject and chapter does this question cover?
This is a Class 11 Business Studies question. Chapter: Social Responsibilities of Business and Business Ethics. Topic: Business Ethics.
