Question

The time horizon for Business Risks is generally considered to be?

Select one:

a. 1 month

b. 1 year

c. 3 years

d. 5 years

Answer 1

Business risk for any business is the inherent probability of making profts or losses , due to various reasons--external & internal.Market demand, consumer preferences are some of the  external uncertainties. Inefficient production or improper management style, labor problems are examples of internal probabilities.

Normally, businesses calculate their financial performances & ratios like profitability ratio, financial leverage ratio, to assess their performance---which takes a year atleast., to form an opinion.

So, the time horizon , given normally to assess these risks are b. 1 Year

Answer. b. 1 year