A pragmatic assizement of defense contractor risk

Abstract

This thesis is an investigation into the measurement and analysis of the relationship between defense contractor risk and profit levels as compared to commercially oriented firms' risk and profit levels. Past studies that have attempted to quantify the interrelationship of risk and profit are examined. Hurdle's leverage, risk, market structure, and profitability model is used as a basis for the current model of risk and profitability. Empirical analyses of defense contractor risk and profit relationships are performed using least squares regression analysis, Chow tests, and three stage simultaneous regression analysis.