ENTREPRENEURSHIP

Detailed explanation-1: -In many cases, the greater the speculative risk, the higher the potential for profits or returns on the investment. A speculative risk has the potential to result in a gain or a loss.

Detailed explanation-2: -A positive correlation exists between risk and return: the greater the risk, the higher the potential for profit or loss. Using the risk-reward tradeoff principle, low levels of uncertainty (risk) are associated with low returns and high levels of uncertainty with high returns.

Detailed explanation-3: -Types of Risks Widely, risks can be classified into three types: Business Risk, Non-Business Risk, and Financial Risk.

Detailed explanation-4: -strategic risk-eg a competitor coming on to the market. compliance and regulatory risk-eg introduction of new rules or legislation. financial risk-eg interest rate rise on your business loan or a non-paying customer. operational risk-eg the breakdown or theft of key equipment.