A Manufactured Risk Differs from an External Risk in That

question 66

Multiple Choice

A manufactured risk differs from an external risk in that:

• A) external risks are accidental risks, and manufactured risks are human made
• B) external risks are environmental risks, and manufactured risks are accidental risks
• C) manufactured risks were more common in the industrial era, and external risks are more common in the postindustrial era
• D) external risks come and go quickly, and manufactured risks can last for some time
• E) an external risk comes from the natural world, and a manufactured risk is human made

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Definitions:

Straight-Line Depreciation

A technique for segmenting the cost of a material asset over its life in even annual segments.

After-Tax Discount Rate

The discount rate used in financial calculations that reflects the net cost of capital after accounting for the effects of taxes.

Discount Factor

A factor by which a future cash flow is multiplied to obtain its present value.

After-Tax Discount Rate

The interest rate used in discounted cash flow analysis to calculate the present value of future cash flows after accounting for taxes.