Question

State with reasons whether the following statements are true or False.

Small business work on full utilisation of their capacity.

Answer 1

Small business work on full utilisation of their capacity- False

Explanation:
The above statement is incorrect. Small-scale firms fail to utilise their optimum capacity due to lack of funds, lack of marketing skills and low demand for their products. This not only leads to the wastage of resources but also increases the operating costs, which forces them to close down their business.