Which One of the Following Is NOT True of Risk

question 53

Multiple Choice

Which one of the following is NOT true of risk?

• A)It is composed of the length of time the asset will be unavailable for other uses.
• B)It is the probability that the strategy will be effective.
• C)Managers who own a significant amount of stock in their firms are less likely to engage in risk-taking actions.
• D)It is the amount of assets the corporation must allocate to that strategy.
• E)The greater the assets involved, the more likely top management is to demand a high probability of success.

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Definitions:

Purely Competitive Firm

A firm that operates in a perfectly competitive market, where there are many buyers and sellers, the product is homogeneous, and there is free entry and exit in the market.

Output Level

The total quantity of goods or services produced by a firm or industry at a given time.

Monopolistic Competition

A market configuration where numerous companies offer products that are alike but not the same, resulting in competitiveness centered on aspects other than price.

Pure Competition

A market structure characterized by an extremely large number of sellers, none of which can influence market price or terms for exchange.