Business Management And Law: Risk Management Test Quiz

47 Questions | Total Attempts: 229

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Business Management Quizzes & Trivia

Business Management and Law, Chapter 11: Risk Management


Questions and Answers
  • 1. 
    No matter how carefully you plan, you cannot avoid all risk.
    • A. 

      True

    • B. 

      False

  • 2. 
    A company can reduce international business risk by offering a wide range of products.
    • A. 

      True

    • B. 

      False

  • 3. 
    Piracy is the illegal copying of software packages or information.
    • A. 

      True

    • B. 

      False

  • 4. 
    Insurance exchanges the uncertainty of a possible large financial loss for a certain smaller payment.
    • A. 

      True

    • B. 

      False

  • 5. 
    Companies should always insure against all risks, no matter how unlikely they are.
    • A. 

      True

    • B. 

      False

  • 6. 
    Insurance companies also function as investment companies.
    • A. 

      True

    • B. 

      False

  • 7. 
    Not all insurance agents work for an insurance company.
    • A. 

      True

    • B. 

      False

  • 8. 
    Commercial property insurance provides compensation for ongoing business expenses that occur if a business has a temporary shutdown due to a fire, flood or other major problem.
    • A. 

      True

    • B. 

      False

  • 9. 
    If a company cannot afford the cost of insurance protection, it simply must go out of business.
    • A. 

      True

    • B. 

      False

  • 10. 
    Counterfeiting refers to the illegal use of intellectual property, whether it is in the form of a patent, trademark, or copyright.
    • A. 

      True

    • B. 

      False

  • 11. 
    Business interruption insurance
    • A. 

      Covers property losses resulting from fire, storms, and theft

    • B. 

      Provides compensation for ongoing business expenses that occur if a business has a temporary shutdown due to a fire, flood or other major problem.

    • C. 

      Provides payments to employees who can not work due to illness or injury

    • D. 

      Protects against losses from injury to people or property resulting from a company's products, services or actions.

  • 12. 
    A risk that relates to harm or injury to other people or their property because of your actions is called
    • A. 

      Personal risk

    • B. 

      Property risk

    • C. 

      Liability risk

    • D. 

      Speculative risk

  • 13. 
    The person or company buying an insurance policy.
    • A. 

      Policyholder

    • B. 

      Agent

    • C. 

      Beneficiary

    • D. 

      Insured

  • 14. 
    A policyholder's request for payment for a loss covered by an insurance policy is a
    • A. 

      Claim.

    • B. 

      Premium.

    • C. 

      Deductible.

    • D. 

      Fraud.

  • 15. 
    A risk that can result in damage to your own health or well-being is called
    • A. 

      Personal risk.

    • B. 

      Property risk.

    • C. 

      Pure risk.

    • D. 

      Liability risk.

  • 16. 
    The person or company for which the insurer assumes the risk is the
    • A. 

      Insured.

    • B. 

      Beneficiary.

    • C. 

      Policyholder.

    • D. 

      Agent.

  • 17. 
    A risk that presents the chance for loss but no opportunity for gain is a
    • A. 

      Speculative risk.

    • B. 

      Pure risk.

    • C. 

      Non-economic risk.

    • D. 

      Liability risk.

  • 18. 
    The exclusive right to possess, use and dispose of property and its profits.
    • A. 

      Property rights

    • B. 

      Patent rights

    • C. 

      Copyright

    • D. 

      Civil rights

  • 19. 
    A risk that can lead to loss of items such as money, vehicles and buildings.
    • A. 

      Property risk

    • B. 

      Personal risk

    • C. 

      Liability risk

    • D. 

      Speculative risk

  • 20. 
    The amount a policyholder pays for insurance coverage.
    • A. 

      Premium

    • B. 

      Claim

    • C. 

      Benefits

    • D. 

      Liability

  • 21. 
    A risk that offers a chance to either gain or lose.
    • A. 

      Speculative risk

    • B. 

      Pure risk

    • C. 

      Personal risk

    • D. 

      Controllable risk

  • 22. 
    Personal, liability and property risks are all examples of
    • A. 

      Uninsurable risks

    • B. 

      Economic risks

    • C. 

      Speculative risks

    • D. 

      Non-economic risks

  • 23. 
    Shrinkage is
    • A. 

      Loss of inventory due to shoplifting, employee theft, or other sources.

    • B. 

      Loss of profits due to a poor business climate.

    • C. 

      Loss of employees to other companies which offer better pay and benefits.

    • D. 

      Loss of ownership share due to stock sales.

  • 24. 
    The actual loss for a business from theft is
    • A. 

      The price the business paid for the product.

    • B. 

      The retail price of the product.

    • C. 

      The profit that would have been made on the product.

    • D. 

      The amount the insurance company will pay for the item.

  • 25. 
    Which of these actions encourages employee theft?
    • A. 

      Ensuring employees are satisfied with their jobs

    • B. 

      Allow employees to process transactions between themselves and the company

    • C. 

      Prohibit employees from making copies of any business-related keys

    • D. 

      Empty cash registers on a regular basis, or whenever they have more than a set level of cash

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