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A business entity is evaluating the different risks it is currently facing Required Identify the risk being considered in each case NB Use N /
A business entity is evaluating the different risks it is currently facing
Required
Identify the risk being considered in each case
NB
Use NA Where it is not possible to calculate a meaningful value
aThe business management is worried about the finance manager who was brought by the CEO has been engaging in frenzy of investing in money market fund without the approval of the management and thos may expose the business to risk
answers
none of the risks given
Financial risk
Exchange rate risk
liquidity risk
political risk
default risk
b The business has taken a lot of loans to finance various activities and to acquire long term assets which have questionable productivity
answers
none of the risk given
financial risk
exchange rate risk
liquidity risk
political risk
default risk
c Due to the tough economic times environment currently prevailing in the economy, the business entity is worried the impact of the economic environment on the business debtors ability to meet their obligation
answers
none of the risk given
financial risk
exchange rate risk
liquidity risk
political risk
default risk
d the business entity management is worried that the impeachment of a key politician will negatively affect the operating environment
none of the risk given
financial risk
exchange rate risk
liquidity risk
political risk
default risk
e the business entity has moved to a new location, and they are surprised to realise the location is prone to flooding.Answers none of the risk given
financial risk
exchange rate risk
liquidity risk
political risk
default risk
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