Risk Management
The cause of a loss, either through natural events or acts of man, as referred to as ....
a. Cause
b. Driver
c. Peril
d. Contribution
c. Peril
A company releases a new, high-tech irrigation system and sets the initial price very high to recover development costs and take advantage of early adopters who are willing to pay more. What pricing strategy is the company using?
A. Price skimming
B. Follow the leader
C. Average pricing
D. Penetration pricing
A. Price skimming
In very small companies, the organizational structure tends to evolve with little conscious planning. T/F.
True
The primary purpose of a company’s core values is to:
A. Set financial targets for the organization.
B. Explain the day-to-day tasks of employees.
C. Establish the guiding principles that shape company culture and behavior.
D. Define long-term market growth objectives.
C. Establish the guiding principles that shape company culture and behavior.
I am considering a single investment. I calculate the B/C ratio as 1.35. According to the B/C ratio, should I invest in this project?
Yes. B/C ratio > 1.
What is the name of the current Secretary of Agriculture?
Brooke Rollins
T/F. When evaluating risk, severity refers to how often the risky prospect will occur.
False. Refers to magnitude of losses associated with the risk
A beef processing company is considering raising the price of its premium steak cuts. How will the elasticity of demand influence how high the company can set its prices?
A. If demand is elastic, the company can raise prices significantly without losing many customers.
B. If demand is inelastic, customers will greatly reduce purchases when prices rise.
C. If demand is elastic, raising prices will cause a large decrease in quantity demanded, limiting how high prices can be set.
D. Elasticity of demand has no effect on pricing decisions.
C. If demand is elastic, raising prices will cause a large decrease in quantity demanded, limiting how high prices can be set.
Linda's high standards and expectations of employee excellent is typical of ___________ leaders.
a. visionary
b. general
c. populist
d. paragon
d. paragon
Which statement best describes the difference between a company’s mission and vision?
A. The mission focuses on future goals, while the vision describes current operations.
B. The mission explains what the company does today, while the vision describes where it wants to be in the future.
C. The mission and vision are interchangeable statements.
D. The vision focuses on financial performance, while the mission focuses on marketing strategies.
B. The mission explains what the company does today, while the vision describes where it wants to be in the future.
The internal rate of return value provides the discount rate that would make the net present value of an investment....
a. greater than zero
b. equal to zero
c. less than zero
d. initially greater than zero, then equal to zero
b. equal to zero
What is the scientific name of the New World screwworm?
A. Cochliomyia hominivorax
B. Chrysomya bezziana
C. Musca domestica
D. Dermatobia hominis
A. Cochliomyia hominivorax
A warehouse manager implements a safety training program for forklift operators and establishes standard operating procedures (SOPs) to reduce the chance of accidents. This is an example of what type of risk management strategy?
A. Loss avoidance
B. Loss prevention
C. Loss reduction
D. Risk transfer
C. Loss reduction
A new agricultural equipment company introduces a line of small tractors at a very low initial price to quickly attract customers and gain market share from established competitors. What pricing strategy is the company using?
A. Price skimming
B. Follow the leader
C. Average pricing
D. Penetration pricing
D. penetration pricing
Barry's expectation that employees will complete his requests immediately is typical of _________ leaders.
a. populist
b. general
c. paragon
d. visionary
b. general
Which of the following is an example of a mission statement?
A. “To be the world’s leading provider of sustainable agricultural equipment.”
B. “To provide high-quality farm machinery that improves productivity and efficiency for our customers.”
C. “Integrity, innovation, and teamwork.”
D. “We envision a future where every farmer has access to affordable technology.”
B. “To provide high-quality farm machinery that improves productivity and efficiency for our customers.”
4 years. (20/5)
What country did President Trump recently indicate we plan to import beef from in order to reduce retail beef prices for U.S consumers?
Argentina
A farm supply company purchases insurance to cover potential damages or injuries that might occur from forklift accidents in its warehouse. This is an example of what type of risk management strategy?
A. Risk avoidance
B. Risk reduction
C. Risk retention
D. Risk transfer
D. Risk transfer
Assume a firm is selling widgets. The selling price per unit is $72, and the firm incurs $15 in labor, $10 in materials, and $40 in other variable costs.
What is the contribution per unit? AND what is the contribution margin?
Contribution per unit: $7 (72 - 15 - 10 - 40)
Contribution margin: 7/72 = 9.72%
Stage 2 in the growth of a business is characterized by...
a. a one person operation
b. hands off management practices
c. a multi layered organization
d. the entrepreneur as a player-coach
d. entrepreneur as a player-coach
Which of the following would most likely be listed as a company’s core value?
A. “To increase market share by 10%.”
B. “To expand into new international markets.”
C. “Integrity and respect in all business dealings.”
D. “To become the industry leader in 5 years.”
C. “Integrity and respect in all business dealings.”
A drawback of the payback period method is that
a. it is biased toward long term projects
b. it does not take into account the time value of money
c. it ignores cash flows realized past the payback period
d. all of these
d. all of these
What is the name of the bluegrass band Dr. Young went to watch last weekend?
Grass Daddies
What is one reason risk management is more difficult for small firms?
1. Insurance not always willing to insure
2. Risk manager is owner, who wears many hats
2. Risk management isn't something we worry about, until it happens
If a firm has a constant contribution margin of 35%. They are working to identify a new price to sell widgets for. These new widgets incur an average variable cost of $195 per unit. What should be the new selling price?
Price = $300
AVC / (1 - cm)
195 / (1 - 0.35)
A drawback of the coaching style of leadership is...
a. Progress can be slow
b. Employees feel burnout
c. Important difficulties get thrown under the rug
d. Too much focus is on comradery and not enough is on accomplishing tasks.
a. Progress can be slow
Which of the following are common shortcomings of a company vision statement?
a. too specific, too inflexible and cannot be achieved in 5 years
b. unrealistic, unconventional, and un-business like
c. too broad, vague or incomplete, bland/uninspiring, not distinctive
d. too broad, too narrow, and too risky
c. too broad, vague or incomplete, bland/uninspiring, not distinctive
Investment A is anticipated to realize annual net cash revenues of $15 million per year. The initial cost of the investment was $150 million. What is the average rate of return of this investment?
10% (15/150)
What is the name of Dr. Young's dog?
Tillie