How is business risk defined in the context of Module 3?

Business risk is defined as the uncertainty in achieving financial goals. This concept encompasses various factors that could potentially impact a company's ability to generate profit, maintain cash flow, or reach other financial objectives. In this context, it reflects the unpredictability inherent in business operations, including changes in market conditions, competition, and economic factors, which can all influence financial outcomes.

Understanding this aspect of business risk is crucial for effective strategic planning and decision-making. Companies must evaluate the risks associated with their operations and market environments to establish realistic financial expectations and align resources accordingly.