How is risk defined? What will be an ideal response?

How is risk defined?

What will be an ideal response?

ANSWER

Risk means different things to different people, depending on the context and on how they feel about taking chances.
While certainly acknowledging these different kinds of risk, we limit our attention to the risk inherent in an
investment. In this context, risk is the potential variability in future cash flows. The wider the range of possible events
that can occur, the greater the risk.