Which of the Following Actions Does Not Help Reduce Risk

question 78

Multiple Choice

Which of the following actions does not help reduce risk?

• A) Extending the service warranty for your notebook
• B) Converting your money market account to a mutual fund account
• C) Contracting to sell your farm produce to the neighborhood grocery
• D) Buying Japanese yen now when you plan to study in Japan next year

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Definitions:

Deferred Profit Sharing

A retirement plan in which employees receive a portion of the company's profits at a later date, usually at retirement.

Pension Plan

A retirement plan that requires an employer to make contributions into a pool of funds set aside for an employee’s future benefit.

Share Appreciation Rights

A type of employee benefit plan that gives an employee the right to receive cash or stock based on the increase in the price of the company shares.

Market Value

The current price at which an asset or service can be bought or sold in the open market.