Asked by Kelin Martinez on Apr 24, 2024
Verified
A change in the price of corn caused by _____ is an example of a long-run financial risk.
A) A strong tornado season which ruined a major percentage of the crop.
B) A shortage due to a severe drought.
C) An increased supply due to an abundant crop.
D) An increased supply due to technological improvements in the production of the grain.
E) A sudden decrease in demand due to a low market price for other grains.
Long-Run Financial Risk
The potential for financial loss or difficulties a company may face over an extended period, often due to changes in market conditions, operational challenges, or shifts in demand.
Price Of Corn
The market value per unit of corn, influenced by factors such as supply, demand, weather conditions, and agricultural policies.
Technological Improvements
Enhancements in technology which boost productivity, efficiency, or create new products and services.
- Distinguish between the sources and characteristics of short-term and long-term financial risks.
Verified Answer
MS
Michelle Sharp7 days ago
Final Answer :
D
Explanation :
Technological improvements in the production of grain represent a long-run change because they permanently alter the production capacity and efficiency, leading to sustained changes in supply and potentially the price of corn. Other options are more short-term or cyclical in nature.
Learning Objectives
- Distinguish between the sources and characteristics of short-term and long-term financial risks.