If business risk of a company goes up than price of stock will
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the price of stock will decrease
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Price of a stock will be reduced if business risk of company is high.
Explanation:
If market is unpredictable it tends to have high risk of the business. High risk adversely affects the financial health of the company. It will also affect the creditability and it will reduce the goodwill of a company. People analyze the stock price in order to know the financial position of the company. When stock price will be reduced people will start selling the shares automatically value of the firm will be reduced in the market.
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