Which of the following best explains a 'commercial risk'?
A) The potential for machinery to breakdown.
B) The extent to which the supplier has a history of success.
C) The uncertainty with regard to the price to be paid and the costs incurred.
D) The extent to which the provider is trustworthy.

Question

Which of the following best explains a 'commercial risk'? 
A) The potential for machinery to breakdown. 
B) The extent to which the supplier has a history of success. 
C) The uncertainty with regard to the price to be paid and the costs incurred. 
D) The extent to which the provider is trustworthy.

Quizplus · Accepted Answer

Commercial risk refers to the risk associated with financial transactions or business ventures. The uncertainty surrounding the price to be paid and costs incurred falls under this category. The potential for machinery breakdown (A) is an operational risk while the provider's trustworthiness (D) relates to reputational risk. The supplier's history of success (B) could be a factor in determining operational or financial risk but does not fully explain commercial risk.

Which of the Following Best Explains a 'Commercial Risk