Question

Aalok factory was completely destroyed due to floods Identify the cases of business risk indicated in the given cases

Answer 1

Answer:

The business risk could be :

• Risk is the chance of loss. It is the possibility of some un-favourable occurrence.
• Risk may be defined as uncertainty in regard to cost, loss, or damage.
• Risk can be high according to the damage cause by flood.

Explanation:

Natural Causes:

Risks which arise due to the actions of Nature (and hence uncontrollable) are called natural risks. For example, risk of rainfall not occurring on time or excessive rain­fall causing flood is a serious risk for farmers. Again, there may be risk of hail storm destroying crops in the field.

Business risk is the possibilities a company will have lower than anticipated profits or experience a loss rather than taking a profit. Business risk is influenced by numerous factors, including sales volume, per-unit price, input costs, competition, and the overall economic climate and government regulations.