Economics B A-Level
Financial risk
What Financial risk means in Economics B A-Level, as defined for Pearson Edexcel.
Definition of Financial risk
Check what you remember
Read the wording for your board, then hide it and explain Financial risk in your own words. Rough notes are fine. This is a self-check, with no mark or grade.
Reference: Pearson Edexcel
The risk of making a loss, which a larger margin of safety indicates is lower, giving the business a buffer against unexpected downturns in demand or increases in costs.
Topics that use Financial risk
- The relationship between revenue and costs (Pearson Edexcel A-Level)
Related terms
- Break-even analysis
- Break-even output
- Break-even point
- Business viability
- Contribution per unit
- Economies of scale
- Fixed costs
- Margin of safety
Using Financial risk in the exam
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