Which is not associated with business risk

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Problem 1: Which of the following is NOT associated with (or does not contribute to) business risk?

Option 1: Demand variability

Option 2: The extent to which interest rates on the firm's debt fluctuate.

Option 3: The extent to which operating costs are fixed.

Option 4: Sales price variability

Option 5: Input price variability

Problem 2: Different borrowers have different risks of bankruptcy, and bankruptcy is costly to lenders. Therefore, lenders charge higher rates to borrowers judged to be more at risk of going bankrupt.

Option 1: true

Option 2: false

Reference no: EM132933990

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