The correct answer is: D. Financing Risk
Financial leverage is the use of borrowed money to finance the purchase of assets. It can be used to increase the return on equity (ROE) for shareholders, but it also increases the risk of financial distress.
Marketing risk is the risk that a company’s marketing strategies will not be successful. This can be due to a number of factors, such as changes in consumer preferences, the introduction of new products by competitors, or changes in the economic environment.
Interest rate risk is the risk that a company’s financial performance will be affected by changes in interest rates. This is because interest rates affect the cost of borrowing money, which can have a significant impact on a company’s profitability.
Foreign exchange risk is the risk that a company’s financial performance will be affected by changes in the exchange rate between currencies. This is because changes in the exchange rate can affect the value of a company’s assets and liabilities, which can have a significant impact on its profitability.
Financing risk is the risk that a company will not be able to repay its debts. This can be due to a number of factors, such as a decline in sales, an increase in costs, or a change in the economic environment.