Problem
a. Why is risk analysis so important to the capital budgeting process?
b. Describe the three types of project risk. Under what situation is each of the types most relevant to the capital budgeting decision?
c. Which type of risk is easiest to measure in practice?
d. Are the three types of project risk usually highly correlated? Explain your answer.
e. Why is the correlation among project risk measures important?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.