1. Hedging is a Answer risk transfer technique.

noninsurance

2. Active retention is a risk management technique for which a business entity is

consciously aware of the risks and deliberately plans to pay part or all of the losses
after they occur.
3. A customer can purchase a Answer to transfer risks to the retailer
so that the retailer becomes responsible for repairing defective product after the
warranty expires. transfer of risk by contracts/ risk transfer via contracts

4. *Loss Answer is a risk management technique for which a business

entity will pay part or all of the losses after they occur. retention

5. Using options to protect against adverse stock price movements is a risk

management technique called Answer risk transfer. hedging price
risk

6. A bank that provides adjustable interest rate loans is adopting the risk management
technique called Answer risk transfer. hedging price

7. A business entity may insert a Answer clause in a contract to make

another party to assume legal liability. Hold-harmless

8. Issuing callable bonds is a risk management technique called Answer

risk transfer. hedging price

9. If a business entity is a corporation, the stockholders (owners) have Answer

; their personal assets cannot be used to pay off business debt.
limited liability

10. Risk transfer via contract is a Answer risk transfer technique.

noninsurance

11. The Answer of a business entity provides limited liability for its
business owners. incorporation

12. A publisher may insert a Answer clause in a contract to hold the

author legally liable if the publisher is sued for plagiarism. hold-harmless
13. Self-insurance is self-Answer . Funding

14. Incorporation of business firm is a technique that transfers the risk of having
insufficient assets to pay business debt to creditors

15. Incorporation is a Answer risk transfer technique. noninsurance

16. A manufacturer may insert a Answer clause in a contract to transfer

risks to the retailer so that the retailer becomes (directly) responsible to the buyers
for the sales of its products. hold-harmless

17. A tenant can sign a Answer to transfer the risk of a rent increase to
the landlord. Contracts

18. When a business entity purchases insurance with a deductible, two risk management
techniques are used to manage risks, namely risk transfer via insurance and
loss Answer . Retention

19. If a business entity is a sole proprietorship, the sole proprietor (owner) has Answer
; his personal assets can be used to pay off business debt.
unlimited liability

20. Self- insurance is a risk management technique for which a party other than an
insurance company will pay part or all of the losses after they occur.

21. Loss Answer is a risk management technique that provides for the
funding of losses after they occur. Retention

22. A business entity which engages a builder to construct a business complex can sign
a contract with a Answer clause to transfer the risk of a price
increase in construction costs to the builder. hold-harmless

23. If a business entity is a partnership, the partners (owners) have Answer

; their personal assets can be used to pay off business debt.
Unlimited liability
24. Self-funding is a special form of loss Answer .retention

25. Contractual risk transfer is a Answer risk transfer technique.

noninsurance

26. Active retention is widely used in corporate risk management in providing employee
benefits such as group health insurance benefits.=self-insurance

27. is a risk management technique for which a business entity is

ignorance of the risks and has unknowingly assumed the losses. Passive retention

28. Hedging price risks is a technique that manages price risks by trading
derivatives.

29. Hedging price risks is a risk management technique that transfers the risk of
unfavourable price fluctuations to a speculator by trading (purchasing and selling)
futures contracts on an organized exchange

30. When a business entity purchases excess insurance, two risk management
techniques are used to manage risks, namely risk transfer via insurance and
loss Answer . retention

31. Self-insurance is a special form of loss Answer .retention

32. Trading futures contracts to manage commodity price risk is a risk management
technique called Answer risk transfer. hedging price risks