RMI 2303 EXAM 2 FSU WITH COMPLETE SOLUTIONS
100% VERIFIED
How do you use the "reward" amount? - ANSWER Cost/benefit analysis
Project cash flows
Discount back to present value
Determine optimal choice
Individuals are measured using - ANSWER Expected Utility
Organizations are measured using - ANSWER Expected value
Organizations have no natural - ANSWER Risk aversion
What are the overriding themes of the BP case? - ANSWER Process management and
Public relations
What best describes the differences in profitability? - ANSWER Business Risk
Efficient Frontier - ANSWER The graphical representation of the tradeoff between risk
and reward
The rebranding of BP under Browne included - ANSWER Green Company/Alternative
fuels
BP Overriding Themes of Case - ANSWER Corporate Strategy
Public Relations
Corporate Culture
,Workplace Safety
Process Management
Greenwashing - ANSWER An attempt to promote the appearances of products and
commodity consumption as environmental or green while deliberately disavowing
environmental impacts; how can an oil company be green? ~ BP case
BP case risk/reward trade-off - ANSWER Worker safety -> $ > Safety
OSHA - ANSWER Concern for worker safety
US Chemical Safety & Hazard Investigation Board (CSB) - ANSWER Concern for safety
leadership and resources for safety
The Baker Report (BP) - ANSWER Failed to give process safety the same emphasis as
other incentives; decentralized management; communication lacking
Premature Death - ANSWER Death with financial obligations remaining
Who is the largest risk with premature death? - ANSWER Single wage earners with
dependants
Smart Pills risk/rewards - ANSWER Health problems, Potentially addictive, Decreased
performance overtime
Increased performance on learning tasks
Who is using smart pills? - ANSWER College students
Increase in GDP can be from ______ increase OR ______ increase - ANSWER Production;
Price
, Political incentives often do what to the discount rate? - ANSWER Increase -> which
means long term $ is not as important
It is ____ to regulate derivatives - ANSWER Difficult
For derivatives, ______ and _____ generates risk and reward - ANSWER Hedging and
Speculation
Labor - ANSWER Efforts of mind and muscle that can be used in the production process
Capital Asset Pricing Model (CAPM) - ANSWER Only reward systemic risk
Not a diversifiable risk
Bias - ANSWER Subjective view/probability - different from objective
What are the types of biases? - ANSWER Age, Cultural, Experience, Gender, Media
Age Bias - ANSWER Younger people take more risks
Cultural Bias - ANSWER Different cultures take more risks
Experience Bias - ANSWER People who have never experienced disaster take more
risks
Gender Bias - ANSWER Men take more risks
Media Bias - ANSWER Disasters on media are what I am at risk for happening to me
100% VERIFIED
How do you use the "reward" amount? - ANSWER Cost/benefit analysis
Project cash flows
Discount back to present value
Determine optimal choice
Individuals are measured using - ANSWER Expected Utility
Organizations are measured using - ANSWER Expected value
Organizations have no natural - ANSWER Risk aversion
What are the overriding themes of the BP case? - ANSWER Process management and
Public relations
What best describes the differences in profitability? - ANSWER Business Risk
Efficient Frontier - ANSWER The graphical representation of the tradeoff between risk
and reward
The rebranding of BP under Browne included - ANSWER Green Company/Alternative
fuels
BP Overriding Themes of Case - ANSWER Corporate Strategy
Public Relations
Corporate Culture
,Workplace Safety
Process Management
Greenwashing - ANSWER An attempt to promote the appearances of products and
commodity consumption as environmental or green while deliberately disavowing
environmental impacts; how can an oil company be green? ~ BP case
BP case risk/reward trade-off - ANSWER Worker safety -> $ > Safety
OSHA - ANSWER Concern for worker safety
US Chemical Safety & Hazard Investigation Board (CSB) - ANSWER Concern for safety
leadership and resources for safety
The Baker Report (BP) - ANSWER Failed to give process safety the same emphasis as
other incentives; decentralized management; communication lacking
Premature Death - ANSWER Death with financial obligations remaining
Who is the largest risk with premature death? - ANSWER Single wage earners with
dependants
Smart Pills risk/rewards - ANSWER Health problems, Potentially addictive, Decreased
performance overtime
Increased performance on learning tasks
Who is using smart pills? - ANSWER College students
Increase in GDP can be from ______ increase OR ______ increase - ANSWER Production;
Price
, Political incentives often do what to the discount rate? - ANSWER Increase -> which
means long term $ is not as important
It is ____ to regulate derivatives - ANSWER Difficult
For derivatives, ______ and _____ generates risk and reward - ANSWER Hedging and
Speculation
Labor - ANSWER Efforts of mind and muscle that can be used in the production process
Capital Asset Pricing Model (CAPM) - ANSWER Only reward systemic risk
Not a diversifiable risk
Bias - ANSWER Subjective view/probability - different from objective
What are the types of biases? - ANSWER Age, Cultural, Experience, Gender, Media
Age Bias - ANSWER Younger people take more risks
Cultural Bias - ANSWER Different cultures take more risks
Experience Bias - ANSWER People who have never experienced disaster take more
risks
Gender Bias - ANSWER Men take more risks
Media Bias - ANSWER Disasters on media are what I am at risk for happening to me
