COMPLETE TEST BANK: MULTINATIONAL
BUSINESS FINANCE, 16TH EDITION | EITEMAN,
STONEHILL, MOFFETT | ISBN 9780137496013
◉ Which of the following provides fundamental possible solutions to
risks with high and low severity and frequency?
a. Risk map
b. Forced matrix
c. Risk profile
d. Kernel's risk matrix
e. Risk management matrix. Answer: E
◉ Self-insuring is a _____ strategy
a. risk avoidance
b. risk transference
c. risk reduction
d. risk retention
e. risk ignorance. Answer: D
◉ The role of chief risk officer (CRO) expanded the traditional risk
manager's role by:
,a. developing an entirely independent department specialized in risk
management.
b. hiring professionals who are specialized in mitigating specific
types of risks.
c. performing only the risk management functions in an
organization.
d. integrating the firm's silos, or separate risks, into a holistic
framework.
e. treating all the risks individually and finding a solution to mitigate
each risk independently.. Answer: D
◉ Identify the process that evaluates all the risks of the
organizations and measures the frequency and severity of each risk.
a. Principal agent analysis
b. Risk profiling
c. Risk mapping
d. Risk benchmarking
e. Risk retention. Answer: B
◉ This process involves charting entire spectrums of risk, not
individual risk "silos" from each separate business unit. It becomes
useful both in identifying risks and in choosing approaches to
mitigate them. They present a cumulative picture of all the risks in
one risk management solution chart. Identify the process.
,a. Risk mapping
b. Risk benchmarking
c. Risk profiling
d. Risk retention
e. Principal agent analysis. Answer: A
◉ You are plotting intersection points between measures of
frequency (on an x-axis) and severity (on a y-axis) and visually
plotting intersection points. Each point represents the relationship
between the frequency of the exposure and the severity of the
exposure for each risk measured. What are you preparing?
a. A risk profile
b. A forced matrix
c. A risk map
d. Kernel's risk matrix
e. A risk management matrix. Answer: C
◉ 1. Which of the following are risks unforeseen events that arise
outside of the normal operating environment?
a. Financial risks
b. Operational risks
c. Business risks
d. Natural and man-made risks
, e. Household risks. Answer: D
◉ While preparing a risk map, risks like earthquake, tornado, mold
exposure, and terrorism would usually:
a. fall into the low-frequency/high-severity quadrant.
b. fall into the high-frequency/high-severity quadrant.
c. fall into the low-frequency/low-severity quadrant.
d. fall into the high-frequency/low-severity quadrant.
e. be excluded because they usually cannot be insured and have to be
retained.. Answer: A
◉ Identify the risks arising from changing market conditions
involving prices, volatility, liquidity, and foreign exchange risk.
a. Household risks
b. Business risks
c. Operational risks
d. Natural and man-made risks
e. Financial risks. Answer: E
◉ Glasgow Tech. is a highly leveraged corporation. What does this
mean?
a. Glasgow Corporation has numerous risk exposures due to
operations all over the world.
BUSINESS FINANCE, 16TH EDITION | EITEMAN,
STONEHILL, MOFFETT | ISBN 9780137496013
◉ Which of the following provides fundamental possible solutions to
risks with high and low severity and frequency?
a. Risk map
b. Forced matrix
c. Risk profile
d. Kernel's risk matrix
e. Risk management matrix. Answer: E
◉ Self-insuring is a _____ strategy
a. risk avoidance
b. risk transference
c. risk reduction
d. risk retention
e. risk ignorance. Answer: D
◉ The role of chief risk officer (CRO) expanded the traditional risk
manager's role by:
,a. developing an entirely independent department specialized in risk
management.
b. hiring professionals who are specialized in mitigating specific
types of risks.
c. performing only the risk management functions in an
organization.
d. integrating the firm's silos, or separate risks, into a holistic
framework.
e. treating all the risks individually and finding a solution to mitigate
each risk independently.. Answer: D
◉ Identify the process that evaluates all the risks of the
organizations and measures the frequency and severity of each risk.
a. Principal agent analysis
b. Risk profiling
c. Risk mapping
d. Risk benchmarking
e. Risk retention. Answer: B
◉ This process involves charting entire spectrums of risk, not
individual risk "silos" from each separate business unit. It becomes
useful both in identifying risks and in choosing approaches to
mitigate them. They present a cumulative picture of all the risks in
one risk management solution chart. Identify the process.
,a. Risk mapping
b. Risk benchmarking
c. Risk profiling
d. Risk retention
e. Principal agent analysis. Answer: A
◉ You are plotting intersection points between measures of
frequency (on an x-axis) and severity (on a y-axis) and visually
plotting intersection points. Each point represents the relationship
between the frequency of the exposure and the severity of the
exposure for each risk measured. What are you preparing?
a. A risk profile
b. A forced matrix
c. A risk map
d. Kernel's risk matrix
e. A risk management matrix. Answer: C
◉ 1. Which of the following are risks unforeseen events that arise
outside of the normal operating environment?
a. Financial risks
b. Operational risks
c. Business risks
d. Natural and man-made risks
, e. Household risks. Answer: D
◉ While preparing a risk map, risks like earthquake, tornado, mold
exposure, and terrorism would usually:
a. fall into the low-frequency/high-severity quadrant.
b. fall into the high-frequency/high-severity quadrant.
c. fall into the low-frequency/low-severity quadrant.
d. fall into the high-frequency/low-severity quadrant.
e. be excluded because they usually cannot be insured and have to be
retained.. Answer: A
◉ Identify the risks arising from changing market conditions
involving prices, volatility, liquidity, and foreign exchange risk.
a. Household risks
b. Business risks
c. Operational risks
d. Natural and man-made risks
e. Financial risks. Answer: E
◉ Glasgow Tech. is a highly leveraged corporation. What does this
mean?
a. Glasgow Corporation has numerous risk exposures due to
operations all over the world.
