Which of the Following Is Not Characteristic of Good Risk

question 31

Multiple Choice

Which of the following is not characteristic of good risk management?

• A)estimating the likelihood of chance events occurring.
• B)planning to eliminate chance events.
• C)identifying potential chance events.
• D)formulating contingency plans in the event of chance events.
• E)analyzing the consequences of chance events.

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Definitions:

Floating Rate

An interest rate that fluctuates over time with the market or an underlying benchmark.

Exotic

Often refers to a type of financial instrument or investment that is complex and not traditional, involving unique characteristics or structures.

Fisher Effect

The relationship between nominal returns, real returns, and inflation.

Nominal Rates

Interest rates or rates of return that have not been adjusted for inflation, representing the face value of financial products.