Which is an example of a speculative risk?
Speculative risk refers to a situation with three possible outcomes. Either (1) nothing will happen, or (2) there will be a loss, or (3) there will be a gain or profit. The best example of speculative risk is gambling. When you enter a casino with $100, there are three possible outcomes with this type of risk.
What is speculative business risk?
Speculative Risk — uncertainty about an event under consideration that could produce either a profit or a loss, such as a business venture or a gambling transaction. A pure risk is generally insurable while speculative risk is usually not.
What is speculative risk and pure risk?
Whereas pure risk is beyond human control and can only result in a loss if it occurs, speculative risk is risk that is taken on voluntarily and can result in either a profit or loss. Speculative risks are thus considered controllable risks.
What is speculative risk class 11?
Speculative risks arise due to changes in market conditions including fluctuations in demand and supply, changes in prices or changes in fashion and tastes of customers. (ii) Pure Risks involve only the possibility of loss or no loss. The chance of fire, theft or strike is example of pure risks.
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