A music store owner is considering expanding the offerings of her business (which currently only includes instrument and sheet music sales)to include instrument rental.What type of risk would accompany the possibility of earning a profit from this extension of the business?
A) Pure
B) Managed
C) Insured
D) Speculative

Question

Quizplus · Accepted Answer

The risk associated with expanding the business to include instrument rental is speculative risk. This is because there is uncertainty regarding the profitability of the new venture, as well as the potential for unforeseen events (such as damage to rented instruments) that could result in financial loss. However, there is also the possibility of earning a profit from this expansion.

A Music Store Owner Is Considering Expanding the Offerings of Her