Final answer:
Specialization risk is not a strategy for reducing risk. Strategies like hedging, gathering information, and spreading are implemented to manage and reduce risk in business and finance.
Step-by-step explanation:
Among the options provided, specialization risk is not typically recognized as a strategy for reducing risk in the context of business and investment. Strategies for risk management often include:
- Hedging: using financial instruments or market strategies to offset the risk of any adverse price movements.
- Gathering information: performing due diligence and research to make informed decisions.
- Spreading: diversifying investments across various assets to reduce exposure to any single risk.
Therefore, specialization risk is not considered a risk reduction strategy, as specialization typically involves focusing on a particular area which can actually increase risk due to a lack of diversification. To answer the student's question, which is not a strategy for reducing risk, the answer would be 'C. specialization risk'