Final answer:
Risk analysis is crucial in business decision-making. Solar Designs is exploring two expansion options and conducting a risk analysis to assess their viability and potential success.
Step-by-step explanation:
Risk analysis is an important step in business decision-making. In this case, Solar Designs is considering an investment in an expanded product line. They are exploring two possible types of expansion. To assess the risks associated with each option, the company investigates the possible outcomes.
One way to analyze the potential risks is to consider the characteristics of each design concept. For example, the solar-powered bicycle in Figure above represents Concept 1. By examining its features, Solar Designs can draw conclusions about the risks involved.
Understanding the risks is crucial for making informed decisions and minimizing potential losses. By conducting a risk analysis, Solar Designs can evaluate the viability and potential success of each expansion option.