Deal of The Day! Hurry Up, Grab the Special Discount - Save 25% - Ends In 00:00:00 Coupon code: SAVE25
Welcome to Pass4Success

- Free Preparation Discussions
Mail Us support@pass4success.com
Location US
Mob_nav_barsMENU

CIMA Exam CIMAPRO19-P02-1 Topic 5 Question 107 Discussion

Actual exam question for CIMA's CIMAPRO19-P02-1 exam
Question #: 107
Topic #: 5
[All CIMAPRO19-P02-1 Questions]

A company is investing in a huge diversification project. The plan is to develop and sell a whole new product line that they have never sold before. They've already started a massive marketing campaign for this new

product line and they are getting good feedback in their market research.

They've had to use debt funding in order to finance the project, but they hope that the returns will be worth the investment and restructuring. If they are successful they will be a step ahead of all their competitors and offer

something none of them can.

What is the risk appetite of this company?

Show Suggested Answer Hide Answer
Suggested Answer: A

by Shawnna at Feb 08, 2025, 01:19 AM

Limited Time Offer

25%

Off

Get Premium CIMAPRO19-P02-1 Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

Submit Cancel
Kristofer
9 days ago
This company is like a gambling addict - all in on the new product line. I hope they've got a backup plan, otherwise they're playing with fire!
upvoted 0 times
...
Devorah
13 days ago
A. Risk seeking, no doubt. They're going all-in on this new product line. Might as well roll the dice while they're at it!
upvoted 0 times
...
Shaquana
18 days ago
D. Impossible to say. We don't have enough information about their overall risk profile and decision-making process to determine their risk appetite here.
upvoted 0 times
Carin
3 days ago
A) Risk seeking
upvoted 0 times
...
...
Shelba
29 days ago
But what if the project fails? Wouldn't that put the company in a risky position?
upvoted 0 times
...
Eva
1 months ago
I agree with Leontine, the company seems to have a high risk appetite to invest in a new product line.
upvoted 0 times
...
Leontine
1 months ago
I think the company is risk seeking because they are taking on debt to finance a new project.
upvoted 0 times
...
Moira
1 months ago
I think the answer is C. Risk neutral. They're not avoiding risk, but they're also not actively seeking it. They're just trying to diversify and stay competitive.
upvoted 0 times
...
Nida
1 months ago
This is a classic case of a risk-seeking company. Investing in a whole new product line with debt financing definitely shows they are willing to take on high risk for potentially high returns.
upvoted 0 times
Rikki
9 days ago
A) Risk seeking
upvoted 0 times
...
Yolando
14 days ago
I don't think they would have taken on debt financing if they were risk averse.
upvoted 0 times
...
Shawna
18 days ago
B) Risk averse
upvoted 0 times
...
Kimbery
20 days ago
I agree, they are definitely taking on a lot of risk with this new project.
upvoted 0 times
...
Micheal
22 days ago
A) Risk seeking
upvoted 0 times
...
...

Save Cancel