What is the primary objective of a feasibility study?

Correct option is C

The primary objective of a feasibility study is to evaluate whether a business idea, project, or venture is viable and sustainable. It involves identifying the strengths and weaknesses of the idea, analyzing the opportunities and challenges, and determining its overall feasibility in terms of market demand, technical requirements, financial viability, and operational practicality.

Explanation of Options:

1. Persuading investors to fund a project: While feasibility studies can be used to attract investors, their primary purpose is to assess viability, not to serve as a direct funding pitch.
2. Assessing the historical background of a business: This is not the focus of a feasibility study; historical analysis may be part of a broader business evaluation but is not the main objective.
3. Uncovering strengths and weaknesses of a business idea: Correct, as feasibility studies aim to analyze all critical aspects of a business idea to determine its practicality and success likelihood.
4. Outlining the technical development process: While technical aspects are considered in a feasibility study, it is broader in scope and includes financial, market, and operational assessments.

Information Booster:

Key Components of a Feasibility Study:

1. Market Feasibility: Analyzes market demand, competition, and target audience.
2. Technical Feasibility: Assesses the technical requirements and resources needed to execute the project.
3. Financial Feasibility: Determines costs, potential revenue, and profitability.
4. Operational Feasibility: Evaluates the practicality of implementing the idea within existing systems.
5. Legal Feasibility: Reviews compliance with laws and regulations.

The outcome of a feasibility study helps stakeholders decide whether to proceed with, modify, or abandon a project.

Additional Knowledge:

Feasibility studies are essential for informed decision-making and minimizing business risks.