Difference between revisions of "Introduction to entrepreneurship/IENT101/Nature/Risk"

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[[File:Risk dice.jpg|300px|right]]
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Anyone thinking about starting a new business or venture of any kind needs to think about possible risks and reward.  
 
Anyone thinking about starting a new business or venture of any kind needs to think about possible risks and reward.  
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* Risk can be defined as the chance of loss. Generally, the higher the risk, the higher the potential for loss. <ref>www.stlouisfed.org/education_resources.</ref>
 
  
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* A Reward is a positive incentive that makes people better off. <ref>www.stlouisfed.org/education_resources.</ref>
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There are two elements to risk assessment: The likelihood that the bad thing will happen and the impact if the bad thing does happen.
  
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There is usually a direct relationship between the risk of a loss and the expected rate of return. The higher the risk of loss, the greater the potential reward. Conversely, the lower the risk of loss, the lower the potential reward.
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A reward is an incentive - it ''may'' be financial, but doesn't have to be. It could be positive feedback, customer loyalty, reputation, and so on.
  
  
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|body=Read these two short articles to learn more about risk and reward:
 
|body=Read these two short articles to learn more about risk and reward:
  
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* [https://www.inc.com/john-brandon/here-s-why-the-risk-reward-model-works-so-well.html/ Here's why the risk-reward model works so well]
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* [https://www.inc.com/john-brandon/here-s-why-the-risk-reward-model-works-so-well.html/ Here's why the risk-reward model works so well] inc.com, 14 October 2015
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* [https://www.entrepreneur.com/article/243061 4 examples of risks leading to reward] entrepreneur.com 21 March 2015
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* [https://www.entrepreneur.com/article/243061 4 examples of risks leading to reward] entrepreneur.com, 21 March 2015
 
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'''WEnote'''
  
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Did anything surprise you in these readings? What do you need to think about in particular in terms of risk and reward?
  
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Let us know your thoughts. For example:
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* ''I was most surprised to discover ...''
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* ''I think entrepreneurs need to ...''
  
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{{:Introduction_to_entrepreneurship/Links/IENT101/WEnote-p}}
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'''References'''
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<references>
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Latest revision as of 21:15, 16 October 2018

Risk dice.jpg


Anyone thinking about starting a new business or venture of any kind needs to think about possible risks and reward.

There are two elements to risk assessment: The likelihood that the bad thing will happen and the impact if the bad thing does happen.

A reward is an incentive - it may be financial, but doesn't have to be. It could be positive feedback, customer loyalty, reputation, and so on.


Icon inter line.svg
Web resources

Read these two short articles to learn more about risk and reward:



WEnote

Did anything surprise you in these readings? What do you need to think about in particular in terms of risk and reward?

Let us know your thoughts. For example:

  • I was most surprised to discover ...
  • I think entrepreneurs need to ...

Post your comment(s) below and then look on the course feed page to see what others have posted.

If you prefer you can create a post on your learning journal blog. Be sure to label or tag your post IENT101.
Note: Your comment will be displayed in the course feed.

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