Which of the Following Equations Is the Correct Way to Calculate

question 14

Multiple Choice

Which of the following equations is the correct way to calculate risk?

• A) Risk = Hazard x Exposure
• B) Risk = Hazard + Exposure * Time)
• C) Risk = Exposure + uncertainty factor
• D) Risk = Hazard

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Definitions:

Cash-Basis Taxpayer

An individual or entity that reports income and deductions in the year that cash is received or paid, respectively.

Account Receivable

Money owed to a company by its customers for goods or services that have been delivered or used but not yet paid for.

Bad Debt

A financial loss that occurs when a debtor fails to repay a loan or credit extended, considered non-recoverable and potentially eligible for a tax deduction.

Professional Gambler

Professional Gambler is an individual for whom gambling is considered a trade or business, allowing them to deduct losses and expenses related to their gambling activities as business expenses.