Nondiversifiable risk Study guides, Class notes & Summaries

1) A family's automobile that is a total loss as a result of a collision is an example of which of the following types of risk? I. Speculative risk II. Diversifiable risk A) I only B) II only C) both I and II D) neither I nor II - B 3) Which of the following statements about chance of loss and risk is (are) true? I. If the chance of loss is identical for two groups, the objective risk must be the same. II. Two individuals may perceive differently the risk inherent in a given activity....

LOMA 308 Module 2 Exam Questions and Answers All Correct The Amber Insurance Company is designing a new life insurance product and has identified two important risks associated with the product: A. The risk that inflation rates will increaseB. The risk that the bonds used to back the product will default Amber will be able to diversify Both Risk A and Risk B Risk A only Risk B only Neither Risk A nor Risk B - Answer-Risk B Only - Bond defaults (Risk B) are diversifiable risks because...

CPCU 500 - Foundations of Risk Management and Insurance Latest 2024 Graded A+ CHAPTER 1 ... What are the two elements of risk? -Uncertainty of outcome - Time of the outcome and type of outcome are uncertain -possibility of a negative outcome - at least 1 outcome is negative What is the difference between probability and possibility? Possibility - an outcome or event may or may not occur. It does not quantify the risk, only verifies the risk is there Probability - the likelihood ...

Risk involves The possibility of a negative outcome. Possibility means - That an outcome may or may not occur. Probabilities are stated as decimal figure, a percentage, or a - Fraction To understand risk, one needs to know the probability of an outcome or event occurring. Which one of the following statements is correct with respect to probability? - It can be used to decide which activities to undertake. The statement, "There is a five percent chance that John will be injured in an au...

CPCU 500 - Full Practice Exam Questions and Answers 100% Verified In order to achieve collaboration, group leaders must A. Remain focused on achieving the goals of their individual groups. B. Focus on the worker's personality rather than results. C. Remain focused on preventing stakeholders from straying from the common goal. D. Promote competition among members of the group. - answerC. Remain focused on preventing stakeholders from straying from the common goal. Which of the following ...

Final Study Set: RMIN 4000 - Daniel Jeremy Brown Questions and Answers Rated A+ Exposures Things of value (assets) that could be lost (Any situation/circumstance in which a loss is possible, regardless of whether a loss actually occurs) Perils Things that could happen to your assets - cause of loss Risk Management What you do to protect these assets and/or prevent/reduce losses (Identifies loss exposures faced by an organization and selects the most appropriate techniques for tre...

RMIN Daniel Brown Test 1 Latest Update 100% Pass exposure things of value (assets) that could be lost Perils things that could happen to your assets cause of a loss risk management what someone does to protect their assets or prevent/ reduce their losses risk a calculated possibility of a negative outcome uncertainty concerning the occurrence of a loss Calculated possibility a probablilistic outcome that is known or estimated ranges from 0 to 1 or a percentage 0 imp...

Risk - Answer the uncertainty about outcomes, with the possibility that some of the outcomes can be negative. Quantified by knowing the probability of the possible outcomes Probability - Answer the likelihood that an outcome or event will occur. Probabilities are stated as a decimal figure, a percentage, or a fraction. What are the 2 elements associated with risk? - Answer uncertainty of outcome + possibility of negative outcome Pure Risk - Answer a chance of loss or no loss, bu...

ARM 400 Exam Questions and Answers 100% Verified When communicating a decision up the organization's chain of command, consulting with outside experts can help a risk management professional do which one of the following? Select one: A. Enhance stakeholders' confidence in the process B. Stay focused on the organization's objectives C. Seek feedback from stakeholders D. Define the organization's risk appetite - answerA An organization must meet the standard of care that it owes to ot...

CPCU 500 Questions and Answers Rated A+ Risk the uncertainty about outcomes, with the possibility that some of the outcomes can be negative. Quantified by knowing the probability of the possible outcomes Probability the likelihood that an outcome or event will occur. Probabilities are stated as a decimal figure, a percentage, or a fraction. What are the 2 elements associated with risk? uncertainty of outcome + possibility of negative outcome Pure Risk a chance of loss or no los...