RMI EXAM 1 QUESTIONS & ANSWERS
There is a great deal of debate regarding what people expect of their government.
Government's may redistribute income through which of the follow:
I. Market intervention
II. Transfer Payments
III. Taxation
A. I only
B. II only
C. III only
D. I and I
E. I, II, and III E - I, II, and III
In module 1, we discussed the six steps of the risk management process. Risk (loss)
Reduction is aimed at:
A. frequency
B. severity
C. both frequency and severity
D. retention
E. none of the above B - severity
Prevention is aimed at frequency, reduction is aimed at severity
Which of the following causes the "invisible hand mechanism" to break down:
I. positive externalities
II. pitfalls in decision making
III. negative externalities
A. I only
B III only
C. I and II
D. I and III
E. I, II, and III D - I and III
positive or negative externalities can cause breakdown
In module 1 we discussed the six steps of the risk management process. The primary
post-loss objective of an organization is:
A. I only
B. II only
C III only
D. I and III
E. I, II and III D - Legislation and Specific taxation
In module 1, we discussed the costs associated with risk. Which of the following is a
burden of risk on society.
I. Fear and worry
II. Need for larger emergency funds
III. The loss of additional of goods and services
, A. I only
B. III only
C. I and II
D. II and III
E. I, II and III E - Fear and worry, Need for larger emergency funds, The loss of
additional goods and services
In module 1 we discussed the six steps of the risk management process. The preferred
approach to risk identification is:
A. questionnaires
B. checklists
C. procedure guides
D. contract analysis
E. combination approach E - combination approach
Which of the following is part of government's role?
A. Maintaining stabiliity
B. Ensuring product development
C. Balancing the budget
D. All of the above
E. None of the above A - maintaining stability
One of the core themes of the reading "A Scientific View of Risk" is that risk reduction
has one of the following costs:
I. Monetary
II. Social utility
III. Non-monetary
A. I only
B. II only
C. III only
D. I and II
E. I and III E - I and III
Both monetary and non-monetary costs
The reading "A Scientific View of Risk: added what component to the definition of risk:
A. adverse effects
B. a time element
C. a possibility of death
D. volatility
E. value of a human life. B - a time element
According to the reading "Innovation Risk: How to Make Smarter Decisions", innovation
changes the trade-off between risk and ________.
A. cost
B. risk relatives
There is a great deal of debate regarding what people expect of their government.
Government's may redistribute income through which of the follow:
I. Market intervention
II. Transfer Payments
III. Taxation
A. I only
B. II only
C. III only
D. I and I
E. I, II, and III E - I, II, and III
In module 1, we discussed the six steps of the risk management process. Risk (loss)
Reduction is aimed at:
A. frequency
B. severity
C. both frequency and severity
D. retention
E. none of the above B - severity
Prevention is aimed at frequency, reduction is aimed at severity
Which of the following causes the "invisible hand mechanism" to break down:
I. positive externalities
II. pitfalls in decision making
III. negative externalities
A. I only
B III only
C. I and II
D. I and III
E. I, II, and III D - I and III
positive or negative externalities can cause breakdown
In module 1 we discussed the six steps of the risk management process. The primary
post-loss objective of an organization is:
A. I only
B. II only
C III only
D. I and III
E. I, II and III D - Legislation and Specific taxation
In module 1, we discussed the costs associated with risk. Which of the following is a
burden of risk on society.
I. Fear and worry
II. Need for larger emergency funds
III. The loss of additional of goods and services
, A. I only
B. III only
C. I and II
D. II and III
E. I, II and III E - Fear and worry, Need for larger emergency funds, The loss of
additional goods and services
In module 1 we discussed the six steps of the risk management process. The preferred
approach to risk identification is:
A. questionnaires
B. checklists
C. procedure guides
D. contract analysis
E. combination approach E - combination approach
Which of the following is part of government's role?
A. Maintaining stabiliity
B. Ensuring product development
C. Balancing the budget
D. All of the above
E. None of the above A - maintaining stability
One of the core themes of the reading "A Scientific View of Risk" is that risk reduction
has one of the following costs:
I. Monetary
II. Social utility
III. Non-monetary
A. I only
B. II only
C. III only
D. I and II
E. I and III E - I and III
Both monetary and non-monetary costs
The reading "A Scientific View of Risk: added what component to the definition of risk:
A. adverse effects
B. a time element
C. a possibility of death
D. volatility
E. value of a human life. B - a time element
According to the reading "Innovation Risk: How to Make Smarter Decisions", innovation
changes the trade-off between risk and ________.
A. cost
B. risk relatives
