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Unformatted text preview: rted prices may result in net
impoverishment. Profit and Risk
Revenue – Expense = Profit (Loss);
The higher the risk, the higher the probability of
losing a large amount of money;
Investment of factors/resources/capital will occur
only if there is a equally large or larger
probability of winning a large amount of money.
winning Risk vs. Uncertainty
Risk Known likelihood of losing a large amount of
Known unknown Uncertainty Unknown likelihood of losing a large amount
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- Spring '06