Match List – I with List – II. (Type of business risk with example)

Choose the correct answer from the options given below :

A-III, B-IV, C-II, D-I

The correct answer is option 4- A-III, B-IV, C-II, D-I.

* Demand for goods or Competition- Economic causes.
Economic causes include uncertainties relating to demand for goods, competition, price, collection of dues from customers, change of technology or method of production, etc. Financial problems, like rise in interest rate for borrowing, levy of higher taxes, etc., also come under these type of causes as they result in higher unexpected cost of operation or business.

* Political disturbances or Mechanical failures- Other causes.
Other causes are unforeseen events, like political disturbances and mechanical failures, such as the bursting of boiler, fluctuations in exchange rates, etc., which lead to the possibility of business risks.

* Carelessness or Negligence of employees- Human causes.
Human causes include such unexpected events, like dishonesty, carelessness or negligence of employees, stoppage of work due to power failure, strikes, riots, management inefficiency, etc.

* Flood or Earthquake- Natural causes.
Natural causes: Human beings have little control over natural calamities, like flood, earthquake, lightning, heavy rains, famine, etc., property and income in business.