Final answer:
Operational risk is associated with the fixed asset acquisition process, referring to the potential losses from inadequate internal processes or external events. In financial asset investment, the risk assessment is crucial, considering credit risk, market risk, and political risk as factors influencing the return and stability of investments.
Step-by-step explanation:
The risk associated with the fixed asset acquisition process is Operational risk. This type of risk refers to the potential for loss resulting from inadequate or failed internal processes, people, and systems, or from external events. When acquiring fixed assets, such risks might involve the mismanagement of the procurement process, including paying too much for the asset, buying an asset that does not meet the company's needs, or failing to properly execute the necessary controls to prevent fraud. Other considerations for fixed asset acquisition include how the asset will be used, the potential for technological obsolescence, and the asset's impact on the company's financial statements.
From an investment standpoint, it is essential to analyze the risk involved in different types of financial assets and understand what considerations are important to investors in the financial market. Investors typically weigh the expected return of an asset against its associated risks, like credit risk, market risk, and political risk. While credit risk involves the possibility of a counterparty's failure to meet contractual financial obligations, market risk pertains to potential losses from the market moving against the position held, and political risk is related to the uncertainties that can affect investments due to political changes or instability.