Variability for expected returns for projects is classified as___________?
Correct answer: B. Stand-alone risk
- A. Expected risk
- B. Stand-alone risk
- C. Variable risk
- D. Returning risk
Explanation
Stand-alone risk is the variability of a project's expected returns when the project is considered by itself. It is commonly measured by the dispersion or standard deviation of project returns.
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About Business Finance
Business finance explains how organisations plan, obtain and use money while balancing risk, return and liquidity. Topics include financial statements, time value of money, budgeting, working capital, capital structure, sources of finance, investment appraisal and cost of capital. Capital budgeting evaluates long-term projects, whereas working capital manages day-to-day operations.
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