Question

According to prof.knight the duration between two major cycles is.
Options
0 3 to 4 years
6 to 12 years
О 5
1 to 5 years
O Upto 12 years
Clear Response​

Answer 1

Answer:

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Answer 2

Answer:

According to Prof. Knight, the duration between two major cycles is 3 to 4 years.

Explanation:

• Professor Frank H. Knight, an American economist, is the author of this hypothesis.
• Hawley's risk-bearing theory serves as the basis for this hypothesis.
• Knight concurs with Hawley that financial gain is an incentive for taking chances.
• Risks come in two flavours: foreseeable danger and unforeseen risk.
• The unpredictable danger is referred to as uncertainty beaming, in Knight's opinion.
• Knight sees financial success as the payoff for assuming risks and uncertainties that are not insurable.
• He distinguishes between insurable risks and those that are not.
• Certain dangers can be quantified, and statistics can be used to determine the likelihood that they will occur.
• Fire, theft, flood, and accidental death hazards are all insurable.
• The insurance provider takes on these risks.
• The cost of production includes the insurance premium that was paid.
• According, to Knight, these anticipated risks are not actual economic hazards that could result in compensation in the form of profit.
• In other words, an insurable risk does not result in a profit.
• According to Prof. Knight, these risks are "uncertainties" and "profit in the appropriate usage of the term is explained by  uncertainties in this sense."
• Since these risks cannot be anticipated or quantified, they cease to be insurable, and the entrepreneur must bear the uncertainty.
• Profit and assuming uncertainty are directly correlated, according to this idea.
• The level of profit increases as uncertainty bearing increases.
• In the current corporate world, uncertainty beaming has grown to be so significant that it is now regarded as a distinct element of production.
• It has a supply price like other aspects, and business owners take risks with the hope of making a specific amount of profit.
• Thus, earning money is the benefit for incurring risk.
• In the modern day, manufacturing must occur before consumption.
• The producers must deal with competing producers, and the future is unknowable and uncertain.
• These uncertainties exist.
• Some business owners can perceive it more clearly than others, which enables them to make money.

Hence, the duration between major cycles is 3 to 4 years.

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