What is meant by the term 'business risk'?
A) The greatest negative change in share value over a 10- year period
B) The percentage change in share value per year
C) The variability of the firm's operating income
D) The variability in the return to shareholders

Question

Quizplus · Accepted Answer

Business risk refers to the variability in a firm's operating income, which is the income earned from the company's core business operations. This risk is influenced by a variety of factors, including competition, economic conditions, market trends, and management decisions. It is important for investors to consider a company's business risk when making investment decisions, as it can impact the company's ability to generate profits and pay dividends to shareholders.

What Is Meant by the Term 'Business Risk