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An entrepreneur invests all savings and starts large production without market study. What is the main entrepreneurial weakness here?

Answer and explanation

Correct answer: Lack of calculated risk

Risk is a normal part of entrepreneurship, but an entrepreneur is expected to take a calculated risk rather than act blindly. Before investing, the person should study customer demand, competitors, costs, available resources, production capacity, and possible losses. Investing all savings in large production without this information exposes the business to avoidable danger. If demand is lower than expected, unsold stock and financial loss may result.

Option B is correct because the main weakness is the lack of calculated risk. The problem is not excess innovation, customer service, or social responsibility. Innovation may be useful, and service may help a business, but neither explains the careless investment described. The entrepreneur should gather evidence, prepare a budget, consider alternatives, and begin at a manageable scale before committing all savings.

Related tags

RiskMarket StudyCalculated Risk

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