Assess Business Risks
The possibility that a loss can occur as the result of a decision or activity.
What is risk?
Legal responsibility for loss or damage.
What is Liability?
Type of risk where it is not possible to predict if a loss will occur or the amount of loss.
What is Uninsurable Risk?
Risk that presents the chance of complete loss or no loss at all and is beyond human control.
What is Pure Risk?
A risk that presents the chance to gain as well as the chance to lose.
What is speculative risk?
Type of bond that provides insurance for the failure of a person to perform his or her duties or for losses resulting from employee theft or dishonesty.
What is Surety Bond?
Malpractice insurance for physicians.
What is Professional Liability Insurance?
Two risks companies face when pricing products and services.
What are Prices set too high, reducing demand and Prices set too low, unable to make a profit?
Three sources of risk.
What are 1) natural risk; 2) human risk; 3) economic risk?
Occurs when the promotion results in customers shifting from an established brand to a new brand made by the same producer.
What is Brand Cannibalization?
This type of risk arises because of the potential actions of individuals, groups, or organizations.
What is Human factor?
Strategy referred to when a company that assumes a risk and deals with the result.
What is Risk Retention?
Four classifications of risk.
What are 1) source of the risk; 2) result of the risk; 3) control of the risk; 4) insurability of the risk
The most serious product risk.
What is something that will cause harm to a customer or end user?
Provides protection against claims of negligent or harmful actions by business professionals.
What is Professional Liability Insurance?
A risk that can be reduced or even avoided by actions you take.
What is Controllable Risk?
Four ways businesses manage risk.
What are 1) avoid risk; 2) transfer the risk; 3) insure the risk; 4) assume the risk
Five factors that combine to determine whether or not a business is successful.
What are 1) type of competition; 2) the economy; 3) laws and regulations; 4) technology; 5) customer needs?
Three ways to handle risk with marketing planning.
What are 1) market analysis; 2) marketing strategy; 3) action plan?
Martin's Variety Store had gross sales of $35,000 last month. Dollar losses due to shoplifting totaled $1,800. Calculate the percentage of gross sales lost to shoplifting last month.
What is 5%?