This document discusses various types of risk that businesses face, specifically those in the agriculture industry. It outlines financial risk associated with debt, business risk from factors like sales and costs, and different attitudes toward risk. The sources of business risk in agriculture are identified as production, price, human, obsolescence, legal, political, economic, and legal risks. Finally, the document lists risk management strategies like obtaining market information, hedging, and production and marketing responses.

1. RISK IN AGRIBUSINESS
 NORFAIZATULAKMA
BT ZAINAL ABIDIN
(219801)
 RABIATUN ADAWIAH
BT NORMAN
(221179)

2. Financial Risk
- Type of risk associated with financing, including
financial transactions that include company loan in
risk of default.
- Example : the debt-to-capital ratio measure the
proportion of debt used, given the total capital
structure of the company. A high proportion of debt
indicated a risky investment.

3. Business Risk
- The possibility that a company will have lower than
anticipated profits or that it will experience a loss
rather than a profit.
- Influenced by numerous factors, including sale
volume, per-unit price, input cost, competition,
overall economic climate and government
regulations.
- A company with a higher business risk should
choose a capital structure that has a lower debt ratio
to ensure that it can meet its financial obligations at

4. Attitudes Toward Risk
1. Risk Averse
- Investor only willing to take on more risk if they are
rewarded with sufficiently higher returns.
2. Risk Seeker (Irrational investor)
- Someone who will enter into an endeavor as long as
positive long run return the money is possible.
3. Risk Neutral
- Try to maximizes return regardless of risk and will not
pay extra to have the risk.

5. Sources Of Business Risk In
Agriculture
Production Risk
Price Risk
Human Risk
Obsolescence Risk
Legal Risk
Political Risk
Economic Risk
Legal Risk

6. Risk Management Strategies
Marketing
Responses
Obtaining
Market
Information
Production
Responses
Hedging