________ is the risk that a government action will negatively affect a company's cash flows.

Question

Quizplus · Accepted Answer

Political risk refers to the risk of government actions, such as changes in regulations, taxes, or nationalization of assets, negatively impacting a company's cash flows. Economic risk refers to the risk of changes in the economy affecting the company's financial performance. Social risk relates to the impact of social factors such as public opinion, demographics, or cultural differences on the company's operations. Expropriation is the act of a government taking over a private asset without consent or compensation. Although expropriation is a form of political risk, it specifically refers to the seizure of assets rather than just the potential negative impact on cash flows.

________ Is the Risk That a Government Action Will Negatively