A Market System Tends to Restrict Business Risk to Owners

question 85

Multiple Choice

A market system tends to restrict business risk to owners and investors. This results in which of the following benefits?

• A) It encourages more people to become entrepreneurs.
• B) Firms have to pay more to attract inputs, as these inputs have to share the risk.
• C) Firms focus attention on prudent risk management, as it is profitable to manage risk.
• D) Income becomes more equally distributed.

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Definitions:

Competitive Advantage

A condition or circumstance that puts a company in a favorable or superior business position compared to its competitors.

Great Locations

Prime or advantageous physical positions for businesses, typically offering high visibility, accessibility, and customer traffic.

Proximity

The physical or psychological closeness between people, places, or things, often influencing interactions and communications.

Integrated CRM

A holistic approach to customer relationship management (CRM) that combines data and processes across all departments to provide a unified customer experience.