: The risk of a project if it were the company's only asset.
Financial managers typically categorize project risks into three levels: 2016 Fin 380 Week 5 Dq1
: How the project affects the overall stability of the company's existing portfolio. : The risk of a project if it were the company's only asset
To quantify these risks, professionals use several sophisticated techniques: Capital Budgeting Basics | Ag Decision Maker 2016 Fin 380 Week 5 Dq1
Every financial projection is essentially an educated guess about the future. Because future cash flows are never guaranteed, must be integrated into the budgeting process to prevent costly blunders.