Risks are common for all firms, but there are different levels of risks in different industries and in different countries. The differences in risks from firm to firm or industry to industry are called unsystematic risks. Consequently, individual firms and industries deal with risks in different ways.
Tasks:
Consider two companies that deal in two entirely different industries, such as Microsoft, which is a technology company, and Caterpillar Inc., which manufactures heavy equipment.
Respond to the following questions:
- Explain how the risks and the approaches to anticipate these risks differ for each company.
- Analyze the kinds of risks that are most intimidating for each.
- While responding, consider how the companies selected should mitigate their risks. How do these companies mitigate their risks during periods of greater uncertainty? What are some of the ways to assess these risks?
Write your response in a minimum of 500 words. Your response should be thorough and address all components of the discussion question in detail, include citations of all sources, where needed, according to the APA Style, and demonstrate accurate spelling, grammar, and punctuation.