FPII: Mid-term Review (Unit 1 and Unit 2)

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

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

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.

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.

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.

The two dimensions of risk are:

• impact and avoidance.

• probability and impact.

• probability and avoidance.

• mitigation and acceptance.

An earthquake is an example of which type of risk?

• operational

• pure

• speculative

• strategic

Which is an example of a hazard risk?

• competitive advantage

• product shortages

• tornadoes

• inflation