3. Understandingbusiness financial risks The total risk in a firm is determined by evaluating the firm's business risk and financial risk. As an analyst, Olivia is comparing two nearly identical manufacturing firms: Western Gas \& Electric Corp. and Eastem Electric & Gas Inc. It is your Job to evaluate the relative business and financial risks of Western G\&E and Eastern EAG. The two firms. have the same level of total assets and expected net operating profit after taxes (NOPAT), but they differ on two critical characteristics: total debt and the standard deviation of expected NOPAT. The following table outlines some of Western G\&E's and Eastern E\&G's characteristics: Use the given financial oata to indicate which firm has the higher degree of each type of risk. Which firm has more business risk? Use the given financial data to indicate which firm has the higher degree of each type of risk. Which firm has more business risk? Western Gas \& Electric Corp. Eastern Electric s Gas Inc. Which firm has more fhancial risk? Eastern Electric \& Gas Inc. Western Gas 8 Electric Corp