Quiz on Business Risks and Risk Management

What does business risk refer to?

• The possibility of making excessive profits

• The possibility of making inadequate profits or losses

• The elimination of all risks

• The certainty of making profits

Which of the following is an internal risk?

• Strikes

• Market fluctuations

• Government regulations

• Natural disasters

What type of risk involves a chance of either profit or loss?

• External Risks

• Operational Risks

• Pure Risks

• Speculative Risks

Which of the following is an example of pure risk?

• Technological advancements

• Investing in stocks

• Fire damage

• Market competition

What is the primary goal of risk management?

• To ensure compliance with regulations

• To increase profits

• To eliminate all risks

• To protect and conserve assets and people

Which method involves eliminating the possibility of a risk becoming a reality?

• Reducing the Risks

• Assuming the Risks

• Avoiding the Risks

• Shifting the Risks

What does reducing the risks involve?

• Transferring responsibility to another party

• Identifying and implementing measures to minimize damage

• Accepting potential losses

• Avoiding risky investments

What is meant by assuming the risks?

• Reducing the likelihood of risks

• Eliminating all risks

• Transferring risks to an insurance company

• Taking responsibility for potential losses

Which of the following is an external risk?

• Employee strikes

• Economic downturns

• Operational inefficiencies

• Technological failures

What is risk shifting also known as?

• Risk transfer

• Risk avoidance

• Risk assumption

• Risk reduction