Homework Answers
ANS: Option (C) (Forecasting risk)
Forecasting risk is the possibility that error in the projected cash flow will lead to wrong or incorrect decision-making. Forecasting is the process of estimating the future based on the past & present data analysis. It helps the management to gain confidence level & enable them make firm & profitable decisions by handling the uncertainities of future.
There are 3 types of Forecasting - Qualitative techniques, Time-Series analysis & casual model.
So the other options given in question, other than Option C are not viable.
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