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BM/APR 2010/ENT300/ETR300

UNIVERSITI TEKNOLOGI MARA

FINAL EXAMINATION

COURSE

FUNDAMENTALS OF ENTREPRENEURSHIP

COURSE CODE

ENT300/ETR300

EXAMINATION

APRIL 2010

TIME

3 HOURS

INSTRUCTIONS TO CANDIDATES
This question paper consists of four (4) parts

PART A (20 Questions)

PART B (20 Questions)
PART C (5 Questions)
PART D (2 Questions)

Answer ALL questions from PART A, B, four (4) questions from PART C, and one (1)
question from PART D.
i)
ii)
iii)

3.

Answer PART A in the True/False Answer Sheet,

Answer PART B in the Objective Answer Sheet.
Answer PART C and PART D in the Answer Booklet. Start each answer on a new
page.

Do not bring any material into the examination room unless permission is given by the
invigilator.
Please check to make sure that this examination pack consists of:
i)
ii)
iii)
iv)

the Question Paper

an Answer Booklet - provided by the Faculty
a True/False Answer Sheet - provided by the Faculty
an Objective Answer Sheet - provided by the Faculty

DO NOT TURN THIS PAGE UNTIL YOU ARE TOLD TO DO SO

This examination paper consists of 10 printed pages
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BM/APR 2010/ENT300/ETR300

PART A
1.

According to motivation theorists, an entrepreneur is a person who has high need for
power (n Pow).

2.

Joseph Aloysius Schumpeter described an entrepreneur as an innovator.

3.

Entrepreneurial motivation is viewed as the willingness of an entrepreneur to sustain

his entrepreneurial behavior.

4.

The term "creativity" refers to the generation of ideas that result in improved
efficiency or effectiveness of a system.

5.

In a franchise system, the royalty refers to an on-going payment made by the

franchisee to the franchisor based on the percentage of sales as agreed upon during
the signing of franchise contract.

6.

The most popular method of starting a business in Malaysia is through family

business succession.

7.

All small enterprises in Malaysia are registered under the Business Registration Act
1956.

8.

In a partnership business, the liability of a partner is limited to the amount of capital

invested in the business, whereas in a sole-proprietorship business, the liability of the
owner is not limited.

9.

Under the Employees Provident Fund Act 1991, all employers and employees
including foreign workers and expatriates must contribute to the Employees
Provident Fund (EPF).

10.

The preparation of a business plan involves the search for and discovery of business
opportunities.

11.

The business plan can be used as a tool to convince potential employee about the
attractiveness of working with the business.

12.

"Market share" is the term used to describe the total potential purchase of the target
market.

13.

Target market refers to the group of customers whose needs and wants can be
satisfied by the business through the supply of goods or services.

14.

The main purpose of preparing a marketing plan is to ensure that the business is
able to produce output or to provide service that can fulfill the expected market
demand or sales.

15.

The "process chart" refers to the diagram showing the job position and hierarchy of
personnel in a particular organization at a particular point in time.

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BM/APR 2010/ENT300/ETR300

16.

The best way to introduce a business organization is to state the business's vision
and objectives in the "Introduction" part of the Business Plan.

17.

In the business plan, the value and benefits of products or services to customers are
discussed in the marketing plan.

18.

The number of personnel who are directly involved in the operation of the business is
determined in the administrative/organizational plan.

19.

In hire-purchase scheme, the money borrowed from banks or financial institutions is

used to finance the acquisition of fixed asset.

20.

The most common source of finance for a new business is the revenue generated by
the business.
(20 marks)

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BM/APR 2010/ENT300/ETR300

PARTB
1.

defined an entrepreneur as a knowledgeable individual who

is instrumental in the development of city-state.
A.
B.
C.
D.
E.

2.

"A successful entrepreneur always finds ways to do things faster or with fewer
resources or at a lower cost". Which of the following entrepreneurial competencies
best describe the above statement:
A.
B.
C.
D.
E.

3.

Background or knowledge accumulation

Incubation process
Idea experience
Evaluation and implementation
Idea exploration

Which of the following statements is NOT TRUE about innovation?

A.
B.
C.
D.
E.

5.

Commitment to work contract

Concern for high quality of work
Efficiency orientation
Systematic planning
Problem solving

In the creativity process the discovery of ideas or solutions to the problems is

involved in the following phase:
A.
B.
C.
D.
E.

4.

Joseph Schumpeter
Adam Smith
Jean Babtiste Say
Carl Menger
Ibnu Khaldun

Operational innovation is more process oriented and tends to be incremental

in nature.
Innovation is a process of converting opportunities into marketable ideas.
Organizational innovation are breakthrough inventions that have widereaching impact and influence which benefit society and business.
Innovation will take place when there is a creative ideas generation.
All of the above are not true.

Which of the following statements is related to a partnership business?

A.
B.
C.
D.
E.

A partnership business can take legal action and face legal action under its
own name.
A partnership business is registered under the Business Registration Act
1956.
The liabilities of the members are limited to the total shares contributed to the
company's capital.
The life span of the entity does not depend on the resignation of its members.
It is compulsory for the entity to appoint a qualified auditor approved by the
Ministry of Finance.

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6.

B.
C.
D.
E.

B.
C.
D.
E.

A franchise is a product and/or service distribution system governed by a

contract made between two parties namely, the franchisor and the franchisee.
The franchisor is a company which sells the right to another party to operate
the franchise.
The franchisor will pay royalty to the franchisee based on the percentage of
sales as agreed in the franchise contract.
The franchisee is a person who purchases the right from the franchisor to
operate the franchise.
All of the above are not true.

Which of the following statements is NOT TRUE?

A.
B.
C.
D.
E.

9.

A sole-proprietorship business is easy to manage compared to other forms of

businesses.
A sole-proprietorship business is easy to form and dissolve with minimum
formalities.
A sole proprietorship business is formed under the Companies Act 1965.
The owner of a sole proprietorship business pays income tax based on his
total individual income.
A sole proprietorship business in not subjected to much government rules and
regulation in comparison to other form of business.

Which of the following statements is NOT TRUE about a franchise business?

A.

8.

BM/APR 2010/ENT300/ETR300

Which of the following statements is NOT TRUE about a sole-proprietorship

business?
A.

7.

An entrepreneur engaging in any manufacturing activity has to obtain a

license from Malaysian Industrial Development Authority (MIDA).
Construction of buildings can only be undertaken with the written approval
from Local Authority.
A planning permission is required from local authority in order to set up a
manufacturing business.
All manufacturers are required to control industrial activities that may result in
a new source of effluent or discharge.
All manufacturers are required to obtain design approval of certificate
machinery and certificate of fitness from Local Authority.

Which of the following ministries/agencies does not provide financial assistance for
entrepreneurs?
A.
B.
C.
D.
E.

Ministry of Science, Technology and Innovation (MOSTI).

Multimedia Development Corporation (MDeC).
Perbadanan Nasional Berhad (PNS).
Perbadanan Usahawan Nasional Berhad (PUNB).
Malaysian Industrial Development Authority (MIDA)

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10.

B.
C.
D.
E.

Investors
Bankers
Suppliers
Auditors
Customers

The "marketing plan" section of a business plan should include all of the following
items, EXCEPT:
A.
B.
C.
D.
E.

14.

A business plan can be used as a basis for determining the viability of the
new business.
A business plan can be used as a communication tool to convince potential
investors of the viability of the new venture.
The format of the business plan includes cover letter, cover page, table of
contents, executive summary, and the main body.
A business plan enables the entrepreneur to distribute business resources
more effectively.
All of the above are true.

The following parties are the readers of the business plan EXCEPT:
A.
B.
C.
D.
E.

13.

Ministry of International Trade and Industry (MITI)

Malaysian External Trade Development Corporation (MATRADE)
Federal Agricultural Marketing Authority (FAMA)
Perbadanan Usahawan Nasional Berhad (PUNB).
All of the above agencies provide marketing assistance to entrepreneurs.

Which of the following statements is TRUE about a business plan?

A.

12.

BM/APR 2010/ENT300/ETR300

Which of the following ministries/agencies does not provide marketing assistance for
entrepreneurs?
A.
B.
C.
D.
E.

11.

Competitors' analysis.
Products' attributes.
Sales forecast.
Pricing strategy.
Business location.

A well prepared marketing plan helps entrepreneurs to:

A.
B.
C.
D.
E.

develop mission and vision of the business.

identify required resources in order to manufacture the products.
evaluate customers' acceptance of the products or services.
estimate total project cost of the business.
assess the profitability of the business.

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15.

17.

standard time to produce one unit product

planned rate of production
productivity index
workers productive hours
All of the above factors are necessary

In an operation system, the business input includes:

I
II
III
IV
V

technology
information
end product
equipment
transformation process

A.
B.
C.
D.
E.

I,
I,
I,
I,
I,

II and III
II and IV
II and V
III and V
IV and V

The statement, "To be a reputable halal Chinese cuisine restaurant in the region", is
an example of the company's
.
A.
B.
C.
D.
E.

18.

BM/APR 2010/ENT300/ETR300

Which of the followings factors is unnecessary in calculating the number of

employees needed in an operation?
A.
B.
C.
D.
E.

16.

Goal
Vision
Mission
Objective
Aspiration

Monthly earning for a Production Manager at Double X-Vision is RM6.000. The

estimated rates of EPF contribution are 12% (employer's contribution) and 1 1 %
(employee's contribution). How much is the monthly cost for Double X-Vision if the
company is having 3 Production Managers?
A.
B.
C.
D.
E.

RM 6,720
RM18,000
RM19,980
RM20.160
RM22.140

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19.

BM/APR 2010/ENT300/ETR300

Which of the following statements is NOT TRUE?

A.
B.
C.
D.
E.

20.

Elements of project cost should include provision for contingencies.

Sources of finance refer to the sources of funds to finance a particular project.
Sources of finance to fund the project cost may come from external and
internal sources.
One of the internal sources of finance for new venture is the entrepreneur's
own capital.
Sources of external funds for a new venture should equal the total project
implementation cost.

Which of the following statements is/are TRUE?

I
II
III
IV
A.
B.
C.
D.
E.

A project implementation cost incorporates both long-term and short-term

expenditure needed to start a project.
Pro forma cash flow statement refers to the projected statement of cash
inflow and outflow throughout the planned period.
Pro forma income statement shows the expected profit or loss for the planned
period.
Current ratio generally shows the business' ability to generate cash to meet
its long-term obligations.
I and II only
I and III only
I and IV only
I, II and III only
All of the above are true
(40 marks)

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BM/APR 2010/ENT300/ETR300

PARTC

QUESTION 1
Define what is opportunity and state three approaches to opportunity identification.
(5 marks)
QUESTION 2
One of the methods to start a new business is through family business succession. Give
five (5) challenges faced by family business successor.
(5 marks)

QUESTION 3
Describe the importance of preparing an operation plan for a new venture.
(5 marks)

QUESTION 4
List five (5) factors that should be considered when conducting a competitors' analysis.
(5 marks)
QUESTION 5
Give five (5) topics that are discussed in an organizational plan.
(5 marks)

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10

BM/APR 2010/ENT300/ETR300

PARTD

QUESTION 1
Explain the meaning of "entrepreneurship". Discuss the importance of entrepreneurship to
Malaysian economy.
(20 marks)

QUESTION 2
Why is developing a financial plan important to a new venture? Explain three (3) pro forma
financial statements that are significant to the financial planning process.
(20 marks)

END OF QUESTION PAPER

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