Business Risk Is Affected by a Firm's Operations

question 34

Multiple Choice

Business risk is affected by a firm's operations.Which of the following is NOT associated with (or does not contribute to) business risk?

• A)demand variability
• B)input price variability
• C)the extent to which operating costs are fixed
• D)the extent to which interest rates on the firm's debt fluctuate

---

Definitions:

Market Value

The estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller.

Par Value

The face value of a bond or stock as stated on the certificate or charter, often used for legal capital or accounting purposes.

Cash

A form of currency that includes coins and paper notes, which is used as a medium of exchange for goods and services.

Shares

Units of ownership interest in a corporation or financial asset, which provide for an equal distribution in any profits, if any are declared, in the form of dividends.