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(Business and financial risk) Which of the following sources of new earnings volatility demonstrates the effect of business versus financial risk (discuss the rationale for
(Business and financial risk) Which of the following sources of new earnings volatility demonstrates the effect of business versus financial risk (discuss the rationale for your decisions): a. Amos Gooding Real Estate Company recently constructed a new office building and borrowed 100 percent of the money needed to fund the project. b. Clearing House Outsourcing has historically paid a printer to prepare all of its printed documents. However, last year the firm acquired its own printing press (paying cash). C. Smithers Enterprises has been a specialty retail shop that sells outdoor camping equipment. The firm recently decided to purchase a golf course. a. Amos Gooding Real Estate Company recently constructed a new office building and borrowed 100 percent of the money needed to fund the project. The fact that the firm borrowed 100% of the cost of the new investment suggests that the firm's risk has risen. (Select from the drop-down menu.) b. Clearing House Outsourcing has historically paid a printer to prepare all of its printed documents. However, last year the firm acquired its own printing press (paying cash). In this instance an outsourcing firm has entered into a new business related to printing. Also, the firm paid cash for the asset acquisition. One might think that the firm's the drop-down menu.) risk may have changed. (Select from c. Smithers Enterprises has been a specialty retail shop that sells outdoor camping equipment. The firm recently decided to purchase a golf course. It would appear that this firm may have changed its overall risk since the firm was a specialty retailer and now combines this business with that of a golf course. (Select from the drop-down menu.)
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