You can measure risk by calculating the risk associated with each project the company decides to take on. A company will generally balance their risks with their expected returns.
to what extent does profitability of a firm measure its efficiency
C) What is the goal of the firm? Discuss how to measure achievement of this goal?
C) What is the goal of the firm? Discuss how to measure achievement of this goal?
if the risk control measure is consistent with mission objectives and budget constraints
Financial risk
The best example of firm-specific risk is the potential for a company to experience a significant drop in stock price due to negative news about its management or a product recall. This type of risk is unique to the firm and does not affect the broader market or other companies in the same industry. Unlike systematic risk, which impacts all firms, firm-specific risk can be mitigated through diversification in a portfolio.
That is NOT true.
___ measure how effectively a firm manages assets to generate revenue
Sensitivity is the an absolute measure of risk
Risk
help to judge risk in the firm
leveraged firm is good because it has low risk than unleveraged firm while earning same amount of profit.