1According to the Indian Ministry of Commerce and Industry, an entity is considered a 'Startup' up to how many years from the date of its incorporation?
A.5 years
B.7 years
C.15 years
D.10 years
Correct Answer: 10 years
Explanation:
An entity shall be considered a Startup up to a period of 10 years from the date of incorporation/registration, provided its turnover has not exceeded 100 Crores.
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2Which government body in India is responsible for recognizing Startups?
A.SEBI
B.RBI
C.DPIIT (Department for Promotion of Industry and Internal Trade)
D.NITI Aayog
Correct Answer: DPIIT (Department for Promotion of Industry and Internal Trade)
Explanation:
The Department for Promotion of Industry and Internal Trade (DPIIT) operates under the Ministry of Commerce and Industry and is the nodal agency for the Startup India initiative.
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3Under the 'Startup India' initiative, eligible startups are exempted from income tax for 3 consecutive years out of 10 years under which section of the Income Tax Act?
A.Section 54GB
B.Section 80C
C.Section 80-IAC
D.Section 10(10D)
Correct Answer: Section 80-IAC
Explanation:
Startups recognized by DPIIT can apply for income tax exemption under Section 80-IAC of the Income Tax Act for 3 consecutive financial years out of their first 10 years.
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4What is the primary benefit regarding patent registration provided under the Startup India scheme?
A.100% reimbursement of filing fees
B.Automatic patent grant without examination
C.80% rebate on filing fees and fast-tracking
D.Exemption from patent laws
Correct Answer: 80% rebate on filing fees and fast-tracking
Explanation:
Startups are provided an 80% rebate in filing of patents vis-a-vis other companies and the examination of patent applications is expedited.
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5The 'Fund of Funds for Startups' (FFS) was established with a corpus of approximately how much amount?
A.
B.
C.
D.
Correct Answer:
Explanation:
The Government established a Fund of Funds for Startups (FFS) with a corpus of INR 10,000 crore to provide funding support for innovation and startups.
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6Under the Startup India initiative, startups can self-certify compliance with how many labour and environment laws?
A.9 Labour Laws and 3 Environment Laws
B.6 Labour Laws and 3 Environment Laws
C.3 Labour Laws and 2 Environment Laws
D.5 Labour Laws and 5 Environment Laws
Correct Answer: 6 Labour Laws and 3 Environment Laws
Explanation:
To reduce the regulatory burden, startups are allowed to self-certify compliance for 6 Labour Laws and 3 Environment Laws.
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7Which of the following is NOT a criterion for a business to be defined as a Startup in India?
A.Incorporated as a Private Limited Company, Partnership Firm, or LLP
B.Turnover not exceeding INR 100 Crore
C.Entity should be working towards innovation/improvement of products
D.Must have at least 50 employees
Correct Answer: Must have at least 50 employees
Explanation:
There is no minimum employee requirement to be defined as a Startup. The definition focuses on age, legal structure, turnover, and scalability/innovation.
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8The '10,000 Startups' initiative is a program led by which organization?
A.CII
B.ASSOCHAM
C.NASSCOM
D.FICCI
Correct Answer: NASSCOM
Explanation:
The 10,000 Startups program is a NASSCOM initiative aimed at incubating, funding, and supporting 10,000 technology startups in India.
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9What is the primary objective of the 'Stand-Up India' scheme?
A.To facilitate bank loans between 10 lakh and 1 Crore to SC/ST and Women borrowers
B.To provide funding solely for IT exports
C.To support large manufacturing industries
D.To support agricultural cooperatives
Correct Answer: To facilitate bank loans between 10 lakh and 1 Crore to SC/ST and Women borrowers
Explanation:
Stand-Up India facilitates bank loans between 10 lakh and 1 Crore to at least one SC or ST borrower and at least one woman borrower per bank branch for setting up a greenfield enterprise.
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10Under the Pradhan Mantri MUDRA Yojana, the 'Tarun' category covers loans of what amount?
A. to
B.Up to
C.Above
D. to
Correct Answer: to
Explanation:
MUDRA has three categories: Shishu (up to 50k), Kishore (50k to 5L), and Tarun (5L to 10L).
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11What does CGTMSE stand for in the context of bank loans for small businesses?
A.Credit Guarantee Fund Trust for Micro and Small Enterprises
B.Central Government Trust for Medium Scale Enterprises
C.Credit Granting Trust for Manufacturing and Service Enterprises
D.Corporate Guarantee Trust for Medium and Small Exports
Correct Answer: Credit Guarantee Fund Trust for Micro and Small Enterprises
Explanation:
CGTMSE provides collateral-free credit to the Micro and Small Enterprise sector.
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12Which scheme allows Startups to wind up their business within 90 days?
A.Startup Closure Act
B.Easy Exit Scheme 2020
C.Fast Track Exit under IBC
D.Voluntary Liquidation Scheme
Correct Answer: Fast Track Exit under IBC
Explanation:
Startups with simple debt structures can be wound up within 90 days under the Insolvency and Bankruptcy Code (IBC), compared to the standard 180 days.
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13Software Technology Parks (STPs) in India are primarily focused on promoting what?
A.Hardware manufacturing
B.Agricultural technology
C.Domestic software sales
D.Software exports
Correct Answer: Software exports
Explanation:
The Software Technology Parks (STP) scheme is a 100% export-oriented scheme for the development and export of computer software.
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14Which agency is responsible for the administration of the STP scheme?
A.TRAI
B.SEBI
C.STPI (Software Technology Parks of India)
D.NASSCOM
Correct Answer: STPI (Software Technology Parks of India)
Explanation:
STPI is an autonomous society under the Ministry of Electronics and Information Technology (MeitY) that administers the STP scheme.
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15Units in Special Economic Zones (SEZs) are considered as ______ for the purpose of trade operations, duties, and tariffs.
A.Domestic Tariff Areas
B.Deemed Foreign Territory
C.Duty-Free Shops
D.Restricted Trade Areas
Correct Answer: Deemed Foreign Territory
Explanation:
SEZs are considered deemed foreign territory for trade operations, meaning goods entering SEZs are treated as imports and goods leaving SEZs to the domestic area are treated as imports.
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16Under the SEZ Act, what is the tax holiday benefit provided for the first 5 years of operation?
A.25% rebate on GST
B.50% income tax exemption
C.100% income tax exemption on export income
D.No tax benefits
Correct Answer: 100% income tax exemption on export income
Explanation:
SEZ units enjoy 100% income tax exemption on export income for the first 5 years, 50% for the next 5 years, and 50% of the reinvested export profit for the next 5 years.
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17What is the full form of SBIR, a highly successful US government funding program for startups?
A.Strategic Business Initiative for Research
B.Small Business International Relations
C.Startup Business Investment Returns
D.Small Business Innovation Research
Correct Answer: Small Business Innovation Research
Explanation:
SBIR stands for Small Business Innovation Research, a US government program that encourages domestic small businesses to engage in Federal Research/R&D.
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18What is the key difference between SBIR and STTR programs?
A.SBIR requires a non-profit research partner, while STTR does not
B.STTR requires the small business to collaborate with a research institution
C.SBIR is only for large corporations
D.STTR does not provide funding
Correct Answer: STTR requires the small business to collaborate with a research institution
Explanation:
The primary difference is that STTR (Small Business Technology Transfer) requires the small business to formally collaborate with a research institution (e.g., a university), whereas SBIR allows it but does not require it.
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19In the context of US Federal Grants, what does NSF stand for?
A.National Science Foundation
B.National Startup Fund
C.New Science Frontiers
D.North American Startup Forum
Correct Answer: National Science Foundation
Explanation:
NSF stands for National Science Foundation, which offers grants like 'America's Seed Fund' to startups developing high-impact technologies.
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20Which phase of the SBIR program is primarily for 'Concept Development' or feasibility study?
A.Phase IV
B.Phase I
C.Phase II
D.Phase III
Correct Answer: Phase I
Explanation:
Phase I of SBIR is to establish the technical merit, feasibility, and commercial potential of the proposed R&D efforts.
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21What is the 'Angel Tax' exemption provided to recognized startups in India?
A.Exemption on dividend tax
B.Exemption on GST for angel investors
C.Exemption on tax levied on investments raised above fair market value
D.Exemption on capital gains from selling shares
Correct Answer: Exemption on tax levied on investments raised above fair market value
Explanation:
Recognized startups are exempt from tax under Section 56(2)(viib) (Angel Tax) when they receive consideration for issue of shares that exceeds the fair market value.
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22Which form must STP units file to certify their software exports?
A.IEC Code
B.GSTR-1
C.Bill of Lading
D.SOFTEX
Correct Answer: SOFTEX
Explanation:
IT/ITeS companies in India, including STP units, must file SOFTEX forms to certify their software exports and repatriate foreign exchange.
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23For a startup to be eligible for the 'Startup India' benefits, it must be incorporated as:
A.Sole Proprietorship
B.Public Limited Company
C.Private Limited Company, Registered Partnership, or LLP
D.Hindu Undivided Family (HUF)
Correct Answer: Private Limited Company, Registered Partnership, or LLP
Explanation:
Sole proprietorships and Public Limited Companies are generally not eligible for DPIIT Startup recognition; it must be a Pvt Ltd, LLP, or Registered Partnership.
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24What is the 'Startup India Hub'?
A.A bank for startups
B.A physical building in Delhi for startups
C.A new tax law
D.An online portal for stakeholder engagement and query resolution
Correct Answer: An online portal for stakeholder engagement and query resolution
Explanation:
The Startup India Hub is a one-stop digital platform for all stakeholders in the startup ecosystem to interact, exchange knowledge, and resolve queries.
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25Which of the following is a key feature of the STTR program regarding the Principal Investigator (PI)?
A.The PI can be employed by either the small business or the research institution
B.The PI must be a foreign national
C.The PI must be a government employee
D.The PI must be employed by the small business
Correct Answer: The PI can be employed by either the small business or the research institution
Explanation:
Unlike SBIR where the PI must be primarily employed by the small business, STTR allows the PI to be employed by either the small business or the collaborating non-profit research institution.
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26NSF SBIR/STTR grants are often referred to as:
A.America's Seed Fund
B.Federal Loans
C.The Golden Ticket
D.Tech Giant Fund
Correct Answer: America's Seed Fund
Explanation:
The NSF SBIR/STTR programs are branded as 'America's Seed Fund' because they provide equity-free funding to early-stage startups.
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27In the context of Startup laws, what does ESOP stand for?
A.Electronic Software Operating Procedure
B.Early Stage Operational Protocol
C.Economic Stabilization of Private companies
D.Employee Stock Ownership Plan
Correct Answer: Employee Stock Ownership Plan
Explanation:
ESOP stands for Employee Stock Ownership Plan, a common method for startups to attract and retain talent by offering ownership interest.
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28Which Indian ministry oversees the Special Economic Zones (SEZs)?
A.Ministry of External Affairs
B.Ministry of Finance
C.Ministry of Corporate Affairs
D.Ministry of Commerce and Industry
Correct Answer: Ministry of Commerce and Industry
Explanation:
The Ministry of Commerce and Industry (Department of Commerce) oversees the implementation and regulation of SEZs in India.
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29What is the primary condition regarding Net Foreign Exchange (NFE) for SEZ units?
A.NFE must be positive every single year
B.NFE must be positive cumulatively over 5 years
C.NFE must exceed
D.NFE is not applicable to SEZ
Correct Answer: NFE must be positive cumulatively over 5 years
Explanation:
SEZ units are required to achieve positive Net Foreign Exchange (NFE) earnings calculated cumulatively for a period of 5 years.
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30Under the NASSCOM 10,000 Startups initiative, what is the 'Warehouse' program?
A.A co-working space and incubation facility
B.A storage facility for hardware goods
C.A cloud storage plan
D.A database of investors
Correct Answer: A co-working space and incubation facility
Explanation:
The 'Warehouse' is a premium co-working space and incubation program initiated by NASSCOM in partnership with state governments to support startups.
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31What type of funding does the NSF SBIR/STTR provide?
A.Equity-free Grants
B.Venture Debt
C.Convertible Note
D.Loan with low interest
Correct Answer: Equity-free Grants
Explanation:
NSF provides non-dilutive (equity-free) grants. The government does not take ownership shares in the company.
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32What is the maximum turnover limit for a Micro Enterprise under the MSME definition (often relevant for startup resources)?
A.
B.
C.
D.
Correct Answer:
Explanation:
Under the revised MSME classification, a Micro enterprise is one where investment does not exceed 1 Crore and turnover does not exceed 5 Crore.
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33Which scheme allows startups to access government tenders that were previously restricted by prior experience/turnover criteria?
A.Global Tender Exemption
B.Startup Tender Waiver
C.Corporate Social Responsibility
D.Public Procurement Policy for MSEs
Correct Answer: Public Procurement Policy for MSEs
Explanation:
The government has relaxed norms for Startups in public procurement, exempting them from 'prior experience' and 'prior turnover' criteria.
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34Phase III of the SBIR program is funded by:
A.Private sector or non-SBIR federal agency funding
B.The SBIR program funds
C.Charitable donations
D.The World Bank
Correct Answer: Private sector or non-SBIR federal agency funding
Explanation:
Phase III is the commercialization phase. It is not funded by the SBIR program itself but must be funded by private investment or regular government contracts.
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35What is a 'Unicorn' in the startup ecosystem?
A.A startup that has gone bankrupt
B.A startup with a valuation of over
C.A startup with a valuation of over
D.A startup focused on animal welfare
Correct Answer: A startup with a valuation of over
Explanation:
A Unicorn is a privately held startup company valued at over .
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36Which of the following is an intellectual property right often critical for technology startups?
A.Affidavit
B.Habeas Corpus
C.Patent
D.Power of Attorney
Correct Answer: Patent
Explanation:
A Patent protects inventions and is a critical form of Intellectual Property Right (IPR) for tech startups.
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37SIDBI stands for:
A.Small Investment Direct Bank of India
B.Startup Investment and Development Bank of India
C.State Industrial Development Bureau of India
D.Small Industries Development Bank of India
Correct Answer: Small Industries Development Bank of India
Explanation:
SIDBI (Small Industries Development Bank of India) is the principal financial institution for the promotion, financing, and development of the MSME sector.
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38Under the STTR program, the small business must perform at least what percentage of the R&D work?
A.10%
B.50%
C.100%
D.40%
Correct Answer: 40%
Explanation:
Under STTR, the small business must perform at least 40% of the work, and the research institution must perform at least 30%.
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39The 'GeM' portal, which aids startups in selling to the government, stands for:
A.Global electronic Market
B.General enterprise Mechanism
C.Government e-Marketplace
D.Goods export Module
Correct Answer: Government e-Marketplace
Explanation:
GeM stands for Government e-Marketplace, an online platform for public procurement in India where startups can sell goods and services to government departments.
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40Which legal structure is most preferred by VCs (Venture Capitalists) for investing in a startup in India?
A.Sole Proprietorship
B.Partnership
C.Private Limited Company
D.LLP
Correct Answer: Private Limited Company
Explanation:
VCs prefer Private Limited Companies because of the ability to issue shares (equity), limited liability, and clear distinction between owners and management.
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41Under the Startup India scheme, the rebate on Trademark filing fees is:
A.10%
B.50%
C.25%
D.100%
Correct Answer: 50%
Explanation:
Startups are eligible for a 50% rebate on Trademark filing fees under the Startup India initiative.
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42Which of the following describes 'Bootstrapping'?
A.Raising money from Angel Investors
B.Getting a government grant
C.Taking a large bank loan
D.Starting a business using personal savings and revenue
Correct Answer: Starting a business using personal savings and revenue
Explanation:
Bootstrapping refers to starting and growing a company using only personal finances or the operating revenue of the new company.
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43For STPs, the import of hardware and software is:
A.Taxed at 28%
B.Taxed at 18%
C.Banned
D.Duty Free
Correct Answer: Duty Free
Explanation:
STP units are allowed to import all types of hardware and software required for their operations completely duty-free.
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44What is the primary role of an 'Incubator' for startups?
A.To provide mentorship, office space, and early-stage support
B.To provide huge loans
C.To buy the startup
D.To audit the startup
Correct Answer: To provide mentorship, office space, and early-stage support
Explanation:
Incubators nurture early-stage startups by providing workspace, mentorship, education, and access to investors.
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45Under Section 54GB of the Income Tax Act, capital gains exemption is available if the proceeds are invested in:
A.Gold Bonds
B.Real Estate
C.Eligible Startups
D.Mutual Funds
Correct Answer: Eligible Startups
Explanation:
Section 54GB provides exemption on capital gains arising from the transfer of residential property if the net consideration is invested in the equity shares of an eligible startup.
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46Which document is essential for a startup to officially govern the relationship between co-founders?
A.NDA
B.Founders' Agreement
C.Rent Agreement
D.Offer Letter
Correct Answer: Founders' Agreement
Explanation:
A Founders' Agreement outlines the roles, responsibilities, equity ownership, and vesting schedules among the co-founders.
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47The 'Multiplier Grants Scheme' (MGS) by MeitY is designed to encourage:
A.Startups to hire more women
B.Collaborative R&D between Industry and Acadernia/R&D institutions
C.Banks to lend to startups
D.Startups to export more
Correct Answer: Collaborative R&D between Industry and Acadernia/R&D institutions
Explanation:
MGS encourages industry to collaborate with premier R&D institutions for the development of products/packages. The government matches the industry's contribution.
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48In the context of SEZ, 'DTA' stands for:
A.District Trade Association
B.Domestic Tariff Area
C.Duty and Tariff Authority
D.Direct Tax Area
Correct Answer: Domestic Tariff Area
Explanation:
DTA stands for Domestic Tariff Area, which refers to the area within India that is outside the Special Economic Zones.
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49What is the typical time frame for a patent examination for recognized startups under the expedited scheme?
A.5-7 years
B.2 weeks
C.10 years
D.Under 1 year (often faster)
Correct Answer: Under 1 year (often faster)
Explanation:
While normal patent examination can take several years, the expedited route for startups aims to complete the process much faster, often within a year.
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50Which act largely governs the formation and regulation of Private Limited Companies in India?
A.The Contract Act, 1872
B.The MSME Act, 2006
C.The Partnership Act, 1932
D.The Companies Act, 2013
Correct Answer: The Companies Act, 2013
Explanation:
The Companies Act, 2013 is the primary legislation governing the incorporation, responsibilities, and dissolution of companies in India.