Based on the projected selling price of $20 per unit,the manufacturer invested a substantial portion of its available cash in a machine that could produce twenty-thousand gumballs in an hour.If consumers weren't willing to pay this much for gum,then the manufacturer faced significant:
A)financial risk.
B)promotion risk.
C)cost estimate risk.
D)market risk.

Question

Quizplus · Accepted Answer

Market risk refers to the uncertainty of consumer demand and the potential for changes in market conditions to negatively impact sales and profitability. In this case, the manufacturer invested in a machine that could produce a large quantity of gum, but if consumers were not willing to pay the projected selling price of $20 per unit, the manufacturer would face significant market risk in terms of lower demand and potential financial losses.

Based on the Projected Selling Price of $20 Per Unit,the