Barney Hopkins is the financial manager for Amax Corporation.He knows that ________ risk deals with good or bad management decisions and ________ is associated with his company's use of debt.

Question

Quizplus · Accepted Answer

Business risk deals with good or bad management decisions, while financial risk is associated with a company's use of debt. Choice D matches these definitions, making it the correct answer. Choices A and B both refer to market risk, which is not the same as business or financial risk. Choice C only half-matches the definitions, as interest rate risk is a type of financial risk, but it does not encompass all aspects of the company's use of debt. Choice E flips the definitions, which is incorrect.

Barney Hopkins Is the Financial Manager for Amax Corporation