Which of the Following Correctly Completes This Sentence: All Else

question 198

Multiple Choice

Which of the following correctly completes this sentence: All else the same, _____________.

• A) The business risk of a firm increases when it takes on a risky project.
• B) The business risk of a firm increases when it takes on more debt.
• C) The financial risk of a firm decreases when it takes on a risky project.
• D) The financial risk of a firm increases when it takes on more equity.
• E) The higher the business risk for a firm, the higher the financial risk as well.

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Definitions:

Nearest Whole Number

A rounding of a number to the closest integer, without any decimal part.

Balanced Scorecard

A strategic planning and management system that organizations use to communicate what they are trying to accomplish and measure progress against these objectives.

Performance Measures

Metrics or indicators used to assess the efficiency, effectiveness, and success of an organization's activities.

Net Operating Income

The profit generated from a company's everyday business operations, calculated by subtracting total operating expenses from total revenue.