objective of risk management can be to reduce the volatility of a firm's cash flows.

Question

Quizplus · Accepted Answer

Risk management aims to identify, assess and control potential risks that may negatively affect a company's financial performance, including volatility in cash flows. By implementing risk management strategies, a company can reduce the likelihood and impact of financial losses due to market fluctuations, credit events, operational risks, and other potential threats. Therefore, the objective of risk management can be to reduce the volatility of a firm's cash flows.

Objective of Risk Management Can Be to Reduce the Volatility