Question

"No business is risk free ".ln the light of this statement explain the different causes of business risk.

Answer 1

Answer:

There are two main causes of business risk;

Market which produces price variability for both outputs and inputs and uncertain availability and quality of the latter.

Biophysical environment which produces yields or production variation.

CAUSES OF BUSINESS RISK;

Competition by different producers and companies.

Input costs,fluctuation of price results unto risk in business.

Overall economic climate which results unto the reduction of suppliers because of low production rate.