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Which one of the following is an example of a calculated risk for Paul's business? Select one answer: ☐ A Sales have increased by 10% in the past 12 months ☐ B Expenses have increased by 15% in the past year ☐ C Profit for the year has decreased by 3.5% ☐ D There is a 30% chance of his business failing - Edexcel - GCSE Business - Question 5 - 2015 - Paper 1
Question 5
Which one of the following is an example of a calculated risk for Paul's business? Select one answer: ☐ A Sales have increased by 10% in the past 12 months ☐ B Expe... show full transcript
Worked Solution & Example Answer:Which one of the following is an example of a calculated risk for Paul's business? Select one answer: ☐ A Sales have increased by 10% in the past 12 months ☐ B Expenses have increased by 15% in the past year ☐ C Profit for the year has decreased by 3.5% ☐ D There is a 30% chance of his business failing - Edexcel - GCSE Business - Question 5 - 2015 - Paper 1
Step 1
Select one answer:
Answer
The most appropriate answer that reflects a calculated risk is:
D There is a 30% chance of his business failing.
Explanation:
A calculated risk involves an informed decision where the potential outcome is weighed against the risks involved. Option D presents an analysis of risk (i.e., a 30% chance) which reflects a consideration of failure and allows for strategic planning to mitigate that risk. In contrast, options A, B, and C describe outcomes rather than risks.