answersLogoWhite

0

Basically, a risk in economic freedom is having to face and accept the concequenses of their decisions. For example, if an entrepreneur starts a business that fails, the government usually won't help out.

User Avatar

Wiki User

11y ago

What else can I help you with?

Continue Learning about Economics

What causes economic risk?

the jews


Why is private property important in the America economic system?

Private property is important in the American economic system because people having the rights to risk investment, own productive assets, and learn new ways of producing; the invisible engine for creating wealth and prosperity for all.


Explain what is meant by the economic risk of a nation Use a specific country as an example?

The possibility that an economic downturn will negatively impact an investment. For example, launching a luxury product immediately before or during a recession carries a great deal of economic risk. Economic risk is closely related to political risk as government decisions impacting the economy may also affect an investment. For example, a central bank may raise interest rates or the legislature may raise taxes, and this may result in economic conditions impacting an investment.


What is Risk adjusted return on economic capital?

RAROC is a risk based profitability measurement for analyzing the risk-adjusted financial performance of the company and for providing a consistent view of the profitability across businesses. RAROC is usually used in banking parlance where companies have to handle the risk of losses.In business enterprises, risk is traded off against benefits. RAROC is defined as the ratio of risk adjusted return to economic capital. The economic capital is the amount of money which is required to secure the survival of the organization in a worst case scenario; it is a buffer against expected shocks in the market values. Economic capital is a function of credit risk, market risk and operational risk and is often calculated by VaR (Value at Risk). This use of capital based on risk improves the capital allocation across the different functional areas of banks, insurance companies or any other business in which capital is placed at risk for an expected return above the risk-free rate.Formula:RAROC = Expected Return / Economic Capital orRAROC = Expected Return / Value at Risk


What do you call a risk taker who starts a new business within the economic system of capitalism?

entrepreneur

Related Questions

Is there a risk if one is working with international money management?

The main risk if one is involved in international money management is the risk of currency exchanges having a negative impact on the money that has been invested.


Is there any risk involved with puberty when you are a vegetarian?

There is no risk involved with puberty when you are a vegetarian.


What are the risk involved in radioactive elements?

the risk are...?


What is a thesis stament for risk involved in cesarean section?

What is a thesis stament for risk involved in cesarean


What is the difference between transaction risk and economic risk?

Transaction is bank risk


Can you get aids from having annal when they are both men?

YES, yes, yes! Anal sex regardless of the sexes involved has a very high risk of spreading the HIV+ if one of the involved parties are positive for HIV


What are the four major risk factors involved in contracting aids?

Multiple partners , sharing needles, blood transfusion, men having sex with men.


What are the three basic choices in risk maagement?

When someone is involved in risk management, they should identify risks and assess vulnerability. People involved with risk management should also identify the risk.


What is the risk involved in business debt?

Mainly 3 types of risks are involved in the debt ie. interest rate risk,Liquidity risk & credut risk. Remeber that debt doesn't mean the risk free investment.


What causes a economic risk?

the jews


What causes economic risk?

the jews


What do you think Reconstruction had on the lives of freedom?

to risk lives

Trending Questions
What is the purpose of special economic zones in china? How can I effectively compare statistical analysis software packages such as Stata and R for my research project? What is the total value of all US real estate? How Short-Term Interest rate future are Priced? What are the steps taken by government of india to increase agricultural produce? A percent of sales earned by a salesperson is called? Why is there opposition to globalization of trade and integration of the world's economy Please assess the majors arguments for and against such globalization efforts.? Direct goods are not directly involved in the production process and normally serve vertical markets. true or false? How much was the mandatory amount spent on federal farm subsidies in 2008? Why is the Graph of the Indifference Curve Convex to the Origin and not Concave? How much was 4000 pounds in 1540 worth today? Why is it important for a Business to consider productivity a well as costs? What is the trading behavior of the market? The interest that tenants own in a real estate they possess is called? What are the scope and nature of service? If four A washers five B washers two C bolts and a D bolt are required to make one grill parts kit. If 100 grill parts kits are needed how many more washers will be consumed than bolts? How have cell phones improved the economy? When is a real estate contract a binding contract? Who is the first richest man in ivory coast? Why specialization leads to economies of scale?