Speculative Business Risk Example
CMAT 2024 · Innovation & Entrepreneurship · Medium · Innovation and Entrepreneurship
Which of the following is an example of speculative business risk?
- A.
A customer is injured while using the product and sues the company
- B.
A supplier's shipment is lost in transit
- C.
A special promotion fails to increase the sales
- D.
A cashier gives unauthorized discounts to friends
Answer
C
Explanation
Speculative risk involves the possibility of either a gain or a loss. A special promotion failing to increase sales is an example of speculative risk because there was potential for either profit or loss associated with running the campaign.
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