comprehensive exam 2025
riskf-fANSWERfanyfuncertaintyfregardingffinancialflossf(thus,f"entity"forf"enterprise"fwidefinfscope)
Whatfaref4friskfclassification?f-fANSWERfpurefvs.fspeculative;fstaticfvs.fdynamic;fobjectivefvs.fsubjective
WhatfisfriskfNOT?f-fANSWERfprobability
puref-fANSWERfloss/noflossfonly
speculativef-fANSWERfloss/nofloss/gain
staticf-fANSWERfunchangingfoverftime
dynamicf-fANSWERfchanges-especiallyfwithftechnology
objectivef-fANSWERfstatisticalfvariationffromfexpectation
subjectivef-fANSWERfindividualfperception/psychology
Whatfarefthefprimaryfburdensfoffriskf-fANSWERfactualfcostfoffloss;fopportunityfcost;fmentalfaguish
Actualfcostfofflossesf-fANSWERftofthefindividualfandfsociety,fcurrentfandffuturefpremiums;floss-
controlfandfcompliancefcosts
, opportunityfcostf-fANSWERfscarcefresourcesfsuchfasftimefandfmoney;frisk/returnftradefoff
mentalfanguishf-fANSWERfgeneralfaggravationfsuchfasfafgoodfnightsfsleep
exposuref-fANSWERfMPL:fMax.fprobableflossf<>fmaxfpossiblefloss
perilf-fANSWERfimminentfdanger;fthefexposureftofriskfoffharmforfloss
hazardf-fANSWERftheffrequency,fphysical,fmoral,forfmoralefthatfisfinfafrisk
frequencyf-fANSWERfnumberfofflossesfand/orfseverityf(moneyfoffloss);fhappensfwhenfoneforfboth
physicalf-fANSWERfbodilyfharm
moralf-fANSWERfconsciousfdesirefforflossfoccurrence
moralef-fANSWERfsubconscious/facilitationfoffloss
adversefselectionf-
fANSWERftendencyfforfpersonsfwhofneedfinsuranceftofgetfit;fmiscalculationfoffhighfriskfasfaflowfrisk
Whatfarefthefbasicftoolsfoffriskfmanagementf-fANSWERfavoid,fretain,ftransfer,fcontrol,fhedging/
arbitrage??
retainf-fANSWERfpassiveforfactive