Question

For small scale production, entrepreneurs prefer:

• A. Sole trade
• B. Partnership
• C. Company
• D. None of these

Hint:

Small-scale industries thrive best under sole proprietorship due to autonomy, simplicity, and low legal requirements.

Answer 1

The Correct Option is A

Step 1: Understanding small-scale production.
Small-scale production refers to business activities carried out on a limited scale, often with small capital investment, few employees, and locally sourced materials.
The management and operations are simple, making it suitable for individuals or families.
Step 2: Suitable ownership form.
For such small operations, entrepreneurs prefer the sole trade (or sole proprietorship) form because it allows complete control, quick decision-making, and minimum legal formalities.
Step 3: Evaluation of options.
(A) Sole trade: Correct. Ideal for small-scale businesses due to flexibility and low cost.
(B) Partnership: Involves shared control, which complicates decision-making for small setups.
(C) Company: Requires more capital and complex regulations.
(D) None of these: Incorrect, as sole trade clearly fits.
Step 4: Conclusion.
Hence, entrepreneurs engaged in small-scale production prefer the sole trade form of business.