Question

Q1. Praveen and Ajay are two friends. Both of them are doing different business. Praveen’s business is facing change in fashion and change in prices and he is also very upset because of tough competition. On the other hand there is a great hurdle in Ajay’s business because of dishonesty of employees, dishonesty of customers and strikes & lockouts.

Point out and explain the type of business risk the two friends are suffering from.

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Answer 1

Point out and explain the type of business risk the two friends are suffering from.

Explanation:

Praveen is facing so many problem just because of speculative risk which includes:

• Degree of gain or loss.
• Environmental changes.

Ajay is facing so many problem because of Economic business risk which includes:

• Changes due to fluctuation on markets.