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The two firms have the same level of total assets and expected net operating profit...

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The two firms have the same level of total assets and expected net operating profit after taxes (NOPAT), but they differ in two critical characteristics: total debt and the standard deviation of the expected NOPAT. The following table outlines some of Red Hamster's and Blue Mouse's major attributes: Red Hamster Blue Mouse Total assets Total debt Expected NOPAT Standard deviation of expected NOPAT Manufacturing Inc. Production Inc. $5,200,000 $1,040,000 $1,248,000 $301,600 $5,200,000 $2,860,000 $1,248,000 $202,800 Use the given financial data to indicate which firm has the higher degree of each type of risk. Which firm has more financial risk? Which firm has more business risk? O Blue Mouse Red Hamster O Blue Mouse O Red Hamster

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