FIN 151-900 Chapter 3 Review

FIN 151-900 Chapter 3 Review - FIN 151 Chapter 3 Review 1....

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FIN 151 Chapter 3 Review 1. Risk management “is a process that identifies loss exposures faced by an organization and selects the most appropriate techniques for treating such exposures.” (43) 2. The objectives of risk management pre-loss are that the firm should prepare for potential losses in the most economical way, the reduction of anxiety, and to meet any legal obligations. The objectives of risk management post-loss are the survival of the firm, to continue operating, and stability of earnings. 3. The steps in the risk management process are identifying loss exposures, analyzing the loss exposures, selecting the appropriate techniques for treating the loss exposures, and implementing and monitoring the risk management program. 4. The sources of information that a risk manage can use to identify loss exposures are risk analysis questionnaires, physical inspections, flowcharts, financial statements, and historical loss data. The maximum possible loss is the worst loss that could happen to the
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FIN 151-900 Chapter 3 Review - FIN 151 Chapter 3 Review 1....

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