Assume your firm produces a good which has high sales when the economy is expanding and low sales during a recession. This firm's overall risk will be higher if it invests in another product which is counter cyclical.

Question

Quizplus · Accepted Answer

Investing in a counter-cyclical product can reduce overall risk by providing a balance, as it may perform well during economic downturns when the primary product's sales are low.

Assume Your Firm Produces a Good Which Has High Sales