CMAT 2026 Previous Year Paper

To assess the adequacy of the market for a business, demand in domestic and international markets, competition analysis, and customer taste and preference analysis are important and directly relevant. But treasury bond yields are a macroeconomic factor used to judge financial markets, not specifically business markets, unless investor funding is directly taken into account.

For example, setting up a sugar-free ice cream startup would not directly consider bond yields when assessing the ice cream market landscape.

Ideation -> Validation -> Financing -> Growth -> Exit is the correct sequence of stages from idea to exit in entrepreneurial financing.

Ideation is the first step because it is the root of an endeavour; next, the idea needs to be validated by assessing its feasibility, demand, and other logistical metrics. Thereafter, financing comes into play, before anything can be implemented, because everything needs capital. After financing, growth will occur, followed by an exit (a premeditated sale, merger, or liquidation).

Market entry and licensing costs, depreciation, and patent registration fees are all directly quantifiable and tangible.

Brand equity and social impact cannot be directly measured in monetary terms; they add long-term value but cannot be assigned a monetary value and are therefore intangible.

Mezzanine financing is a hybrid, subordinated debt-equity instrument that bridges the gap between senior debt and equity, typically used by mature, mid-to-late-stage companies for growth, acquisitions, or restructuring.

Locking down financing involves securing specific terms on loans or investments to mitigate risk

Staged Financing is known for the risk mitigation it offers because by releasing funds in stages (e.g., seed, Series A, B, C), VCs can stop funding if a project is underperforming, preventing further losses. Hence, it is the right answer.

Look-up is not a type of financing.

Ideation is about creating fresh ideas.

Concept development involves defining value propositions and business models.

Implementation involves translating ideas into prototypes and tangible items.

Commercialisation is the launch of a product into the market.

And, these steps are followed in the particular order given above.

Joseph Schumpeter defined the entrepreneur as an innovator and a "disruptive force" who drives economic development by carrying out "new combinations". Instead of just managing, the Schumpeterian entrepreneur breaks the stationary, circular flow of economic activity through creative destruction, introducing new products, methods, markets, or organisational structures. These attributes are those of an innovator; hence, innovator is the correct choice.

The standard steps of the design thinking process, by definition, are- ideate, define, test, prototype and empathise.

So here, brainstorming and incubation do not come.

Brainstorming is part of the ideation process itself; hence, it is not a separate step.

Incubation is a later stage of structured support to enable growth and is not part of the design thinking process.

Entrepreneurs identify a market need and take the associated risks to solve the problem. Hence, entrepreneurs are those who introduce modernisation and innovation. They do not specifically avoid risk or follow global trends.

Entrepreneurs are innovators, and innovation is a fresh idea that is developed into a viable product or service that can generate revenue. Hence, both the assertion and the reasons are correct, and the reason appropriately explains the assertion.

NABARD is the National Bank for Agricultural and Rural Development, and hence, the right match for NABARD is rural development.

Atal Innovation Mission was launched to support grass-roots and social innovation and incubation.

Entrepreneurial development programs are for self-employment and the growth of small-scale ventures.

India permits 100% Foreign Direct Investment (FDI) in Single Brand Retail Trading (SBRT) under the automatic route, allowing foreign entities to own and operate stores without prior government approval.