Faking an accident to collect insurance proceeds is an example of A) physical hazard. B) objective risk. C) moral hazard. D) attitudinal hazard. ANSWER Answer: C
Date: September 19th, 2020
Dense fog that increases the chance of an automobile accident is an example of a A) speculative risk. B) peril. C) physical hazard. D) moral hazard. ANSWER Answer: C
Date: September 19th, 2020
An earthquake is an example of a(n) A) moral hazard. B) peril. C) physical hazard. D) objective risk. ANSWER Answer: B
Date: September 19th, 2020
Taylor Tobacco Company is concerned that the company may be held liable in a court of law and ordered to pay a large damage award to a smoker harmed by the company’s cigarettes. The characteristics of the judicial system that increase the frequency and severity of loss are known as A) moral hazard. B) particular […]
Date: September 19th, 2020
Some characteristics of the judicial system and regulatory environment increase the frequency and severity of loss. This hazard is called A) moral hazard. B) physical hazard. C) attitudinal hazard. D) legal hazard. ANSWER Answer: D
Date: September 19th, 2020
A name that encompasses all of the major risks faced by a business firm is A) financial risk. B) speculative risk. C) enterprise risk. D) pure risk. ANSWER Answer: C
Date: September 19th, 2020
One of the speculative financial risks considered in an enterprise risk management program is the risk of loss because of adverse changes in commodity prices, interest rates, foreign exchange rates, and the value of money. This risk is called A) property risk. B) financial risk. C) strategic risk. D) operational risk. ANSWER Answer: […]
Date: September 19th, 2020
Traditionally, risk has been defined as A) any situation in which the probability of loss is one. B) any situation in which the probability of loss is zero. C) uncertainty concerning the occurrence of loss. D) the probability of a loss occurring. ANSWER Answer: C
Date: September 19th, 2020
Which of the following statements about financial risk is (are) true? I. Enterprise risk does not include financial risk. II. Financial risk is easily addressed through the purchase of insurance. A) I only B) II only C) both I and II D) neither I nor II ANSWER Answer: D
Date: September 19th, 2020
Uncertainty based on a person’s mental condition or state of mind is known as A) objective risk. B) subjective risk. C) objective probability. D) subjective probability. ANSWER Answer: B
Date: September 19th, 2020
