1. Business risk can be reduced:
A) with insurance.
B) through diversification.
C) by using less financial leverage.
D) by using only favorable financial leverage.
2. Business risk:
A) is increased by the use of financial leverage.
B) is the likelihood that actual operating results will vary from expectations.
C) stems only from the possibility that the business person will err in judgement.
D) should always be avoided.
3. One of the characteristics of Monte Carlo Simulation is that it incorporates a probability distribution for each of the different input variables into it's analysis.
A. True
B. False
3.