Business Risk Factors

Factors Affecting Business Risk

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Question

Which of the following affects a firm's business risk?

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Explanations

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A. B. C. D.

D

Business risk depends on: (1) unit sales variability, (2) sales price variability, (3) input price variability, (4) ability to adjust output prices for changes in input prices and, (5) the extent to which costs are fixed (operating leverage).