FIN 341 EXAM 1 CORE FINANCIAL MANAGEMENT CONCEPTS REVIEW 2026

FIN 341 EXAM 1 CORE FINANCIAL
MANAGEMENT CONCEPTS REVIEW 2026

◉ Top 3 global risks in 2025.
Answer: Cyber incidents, business interruptions, natural
catastrophes


◉ Define Risk.
Answer: Uncertainty concerning the occurrence of a loss


◉ Loss Exposure.
Answer: any situation or circumstance in which a loss is possible,
regardless of whether a loss occurs


◉ Objective Risk.
Answer: the relative variation of actual loss from expected loss


◉ Subjective Risk.
Answer: uncertainty based on a person's mental condition or state
of mind


◉ Chance of Loss.

, Answer: the probability that an event that causes a loss will occur


◉ Peril.
Answer: cause of loss
- Fire, Flood, Theft, earthquake


◉ hazard.
Answer: a condition that creates or increases the frequency or
severity of loss
- Structure of house,


◉ Physical Hazard.
Answer: a physical condition that increases the frequency or
severity of loss
- Construction
- Location
- Road conditions


◉ moral hazard.
Answer: dishonesty or character defects in an individual that
increase the frequency or severity of loss