Which type of risk must a manager evaluate when assessing potential production gains from new technology?

When evaluating potential production gains from new technology, the focus is primarily on production risk. This type of risk pertains to uncertainties that can affect the yield and efficiency of operations after adopting new technologies. It includes factors such as the effectiveness of the technology in real-world applications, potential operational difficulties, and variations in environmental conditions that might impact production processes.

Understanding production risk is crucial for managers because it aids in assessing whether the anticipated benefits of the new technology will materialize. For instance, a manager must consider whether the new technology will indeed lead to higher outputs or if it might negatively affect existing production processes. Evaluating this risk involves looking into how reliable the technology is, the learning curve associated with it, and any dependencies on specific inputs or conditions that might not be guaranteed.

In contrast, the other types of risks — market, financial, and personal — deal with different aspects of the agribusiness. Market risk focuses on factors that can affect the sale prices of products due to changes in demand and competition. Financial risk deals with the costs of implementing technology and how it impacts the overall financial health of the operation. Personal risk relates to individual or psychosocial factors affecting decision-making. While these risks are also relevant in the broader context of agribusiness management,