BusFin 3300 Midterm I Questions With Complete Solutions
5 views 0 purchase
Course
BusFin 3300
Institution
BusFin 3300
Risk Management - Correct Answer a process that identifies loss exposures faced by an organization and selects the most appropriate techniques for treating such exposures
Loss Exposure - Correct Answer any situation or circumstance in which a loss is possible, regardless of whether a loss oc...
BusFin 3300 Midterm I Questions With Complete
Solutions
Risk Management - Correct Answer a process that identifies loss exposures faced by an organization
and selects the most appropriate techniques for treating such exposures
Loss Exposure - Correct Answer any situation or circumstance in which a loss is possible, regardless of
whether a loss occurs
T/f: Possibility is NOT the same thing as possibility - Correct Answer True
Chance of Loss - Correct Answer the probability that an event will occur
Objective Probability - Correct Answer refers to the long-run relative frequency of an event based on
the assumptions of an infinite number of observations (uses data and past actions)
subjective probability - Correct Answer the individual's personal estimate of the chance of loss
Objective Risk - Correct Answer the relative variation of actual loss from expected loss
peril - Correct Answer cause of loss
hazard - Correct Answer Increases the chance of loss
Physical Hazard - Correct Answer a physical condition that increases the frequency or severity of loss
Moral Hazard - Correct Answer dishonesty or character defects in an individual that increase the
frequency or severity of loss
Legal Hazard - Correct Answer A condition of the legal environment that increases loss frequency or
severity.
, Pure Risk - Correct Answer only possibility is loss or no loss (catastrophies/insurance)
Speculative Risk - Correct Answer Profit or loss is possible (gambling)
diversifiable risk - Correct Answer A risk that affects only some individuals, businesses, or small groups.
nondiversifiable risk - Correct Answer A risk that affects a large segment of society at the same time.
Enterprise Risk Management - Correct Answer combines into a single unified treatment program all
major risks faced by the firm; pure, spec, strategic, operational, financial
Systematic Risk - Correct Answer a risk that influences a large number of assets; collapse of entire
system/market
Direct Loss - Correct Answer a financial loss that results from the physical damage, destruction, or theft
of the property
Indirect Loss - Correct Answer Loss that is a result or consequence of a direct loss
Liability Risk - Correct Answer relates to harm or injury to other people or their property because of
your actions
Risk Avoidance - Correct Answer how to reduce the severity of a loss
Avoidance - Correct Answer Avoiding a loss
Loss Prevention - Correct Answer any activity that reduces the probability that a loss will occur
Loss Reduction - Correct Answer A risk control technique that reduces the severity of a particular loss.
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller Victoria108. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $13.99. You're not tied to anything after your purchase.
