The risk-shifting problem tends to be __________ for __________ firms than for __________ firms.
A) greater; small; large
B) greater; large; small
C) the same; large; small
D) None of the above.

Question

Quizplus · Accepted Answer

The risk-shifting problem tends to be greater for small firms than for large firms, primarily because small firms often have less diversified business operations and may have more difficulty accessing capital markets to spread or manage risk.

The Risk-Shifting Problem Tends to Be __________ for __________ Firms

The Risk-Shifting Problem Tends to Be for Firms