Firms that are not highly capital intensive are more risky than those that are.

Question

Quizplus · Accepted Answer

Firms that are highly capital intensive require large investments in physical assets and tend to have a higher level of fixed costs. This means that they can be more vulnerable to economic downturns or changes in demand for their products or services. In contrast, firms that are not highly capital intensive typically have lower fixed costs and are more adaptable to changes in the market, making them less risky.

Firms That Are Not Highly Capital Intensive Are More Risky