FP2 1.01 Management Risk Management

What can risk managers do to ensure the successful launch of a new product?

• act quickly to beat the competition
• evaluate potential gains and losses of the event
• develop fail-proof strategies for the calendar year
• ignore issues the company has encountered in the past

What category of risk typically has the most impact on the ability of a business to reach planned goals and objectives?

• financial
• hazard
• operational
• strategic

Technological innovations can increase the strategic risk for business by:

• causing interest rate growth.
• making some products obsolete.
• eliminating the convenience of buying in person.
• decreasing the supply of people seeking employment.

A good source of information about the retroactive risks of a business would be a/an:

• environmental scan.
• purchasing manager.
• business incident log.
• local weather forecast.

The term risk is used in business to refer to the:

• chances that consumers take.
• possibility or probability of loss.
• mistakes that employees make.
• uncontrollable possibility of danger.

Which is often used to measure and rate potential risks?

• an environmental scan
• transference strategies
• an impact/probability chart
• contingency and fallback plans

Which statement accurately describes the nature of prospective risks?

• They are typically more common than retroactive risks.
• They are usually easier to identify than retroactive risks.
• They have failed to happen before but could occur in the future.
• They have occurred in the past so they will fail to reoccur in the future.

An earthquake is an example of which type of risk?

• operational
• pure
• speculative
• strategic

The two dimensions of risk are:

• impact and avoidance.
• probability and impact.
• probability and avoidance.
• mitigation and acceptance.

Which is an example of a hazard risk?

• competitive advantage
• product shortages
• tornadoes
• inflation