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The chance that a firm fails to meet its payment obligations is called:
ABusiness risk
BMarket risk
CProduct risk
DFinancial risk
Answer & Solution
Correct answer: D. Financial risk
1. Higher debt raises fixed financial charges.
2. Default can force liquidation.
3. That chance is financial risk.
_Source: NCERT Class 12 Business Studies Part II, Chapter 9, Financial Management._
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