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Class 11 MSME and Business Entrepreneurship: cheat sheet
CBSE Business Studies. How micro, small and medium enterprises are classified, their role and problems, what entrepreneurship is, and the kinds of intellectual property.
Key ideas
- MSMEs are classified on two tests together: investment in plant and machinery or equipment, and annual turnover.
- They employ many people with little capital, help rural and backward areas grow, use local resources and skills, and add to production and exports.
- Their common problems are shortage of finance and raw materials, weak managerial skill and marketing, poor quality, low use of capacity, outdated technology and global competition.
- An entrepreneur starts a business, combines resources and bears its risks; entrepreneurship is systematic, lawful, purposeful, innovative and risk taking.
- Intellectual property is creations of the mind; the law protects it so that creators can earn from their ideas and others cannot copy them freely.
- The kinds recognised in India are copyright, trademark, geographical indication, patent, design, plant variety and semiconductor layout design.
Remember
| Micro (book’s limits) | investment up to ₹1 crore and turnover up to ₹5 crore |
| Small | investment up to ₹10 crore and turnover up to ₹50 crore |
| Medium | investment up to ₹50 crore and turnover up to ₹250 crore |
| Classifying a unit | it must be within BOTH limits of a class: try micro, then small, then medium; above all three it is not an MSME |
| Copyright | the creator’s right over an original book, song, artwork or film |
| Patent | an exclusive right over a new and useful invention |
| Trademark | a name, word, logo or symbol that marks one firm’s goods |
| Geographical indication | goods whose qualities come from their place of origin |
Watch out
- Classifying by investment alone: a unit must be within both the investment and the turnover limit.
- Mixing up patent and copyright: inventions are patented, books and songs are copyrighted.
- Calling a logo a patent: a name or symbol is a trademark.
Worked example
Classify these enterprises using the book’s limits: (a) investment ₹1 crore, turnover ₹4 crore (b) investment ₹45 crore, turnover ₹150 crore
Working: micro: ₹1 cr and ₹5 cr; small: ₹10 cr and ₹50 cr; medium: ₹50 cr and ₹250 cr
Answer: (a) micro (b) medium
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