# Study sets matching "risk chapter 1"

Study sets

Diagrams

Classes

Users

B

C

D

E

Economic collapse during the 1930s, the banking system in the…

Depository financial institutions include all of the following…

Nondepository financial institutions are represented by all of…

Which of the following statements is FALSE?... A. A financial in…

B

Economic collapse during the 1930s, the banking system in the…

C

Depository financial institutions include all of the following…

Loss Exposure

Objective Risk

Subjective Risk

Chance of Loss

Any situation or circumstance in which a loss is possible, reg…

is defined as the relative variation of actual loss from expec…

is defined as uncertainty based on a person's mental condition…

The probability that an event will occur

Loss Exposure

Any situation or circumstance in which a loss is possible, reg…

Objective Risk

is defined as the relative variation of actual loss from expec…

Risk

Risk is used...

Uncertainty is used...

loss exposure

uncertainty concerning the occurrence of a loss

where the probabilities of possible outcomes are known or can…

where such probabilities cannot be estimated

any situation in which a loss is possible, regardless of wheth…

Risk

uncertainty concerning the occurrence of a loss

Risk is used...

where the probabilities of possible outcomes are known or can…

Risk

Objective risk

Subjective risk

Objectively; Subjectively

Relative variation from expectations

-Relative variation from experience... -Measurable by looking at…

-Uncertainty based on thoughts

Most risks are both "___" and "___" risky, that is, unless you…

Risk

Relative variation from expectations

Objective risk

-Relative variation from experience... -Measurable by looking at…

Risk definition

The two elements with in the definition…

possibility and probability

Most common types of risk

uncertaintiy of an outcome withe the possibilty of a negative…

uncertainty of an outcome... possibility of a negative out come

possiblity doesnt quantify risk;it only verfies that risk is p…

Pure and speculative risk... Subjective and objective... diversable…

Risk definition

uncertaintiy of an outcome withe the possibilty of a negative…

The two elements with in the definition…

uncertainty of an outcome... possibility of a negative out come

Risk

Risk

Uncertainty

Loss Exposure

Uncertainty concerning the occurrence of a loss

The property or life that is being considered for insurance

Applies to situations where the probabilities of possible outc…

Any situation in which a loss is possible, regardless of wheth…

Risk

Uncertainty concerning the occurrence of a loss

Risk

The property or life that is being considered for insurance

Risk

Risk Management

Pure Risk

Speculative Risk

Uncertainty as to loss

the process used to systematically manage risk exposures

A risk that exists when there is uncertainty as to whether a l…

A risk that exists when there exists uncertainty about an even…

Risk

Uncertainty as to loss

Risk Management

the process used to systematically manage risk exposures

Risk

Risk is used in situations where?

Uncertainty is used when?

Loss Exposure

Uncertainty concerning the occurrence of a loss.

The probabilities of possible outcomes are known.

probabilities cannot be estimated.

Any situation in which a loss is possible, regardless of wheth…

Risk

Uncertainty concerning the occurrence of a loss.

Risk is used in situations where?

The probabilities of possible outcomes are known.

Risk

objective risk

subjective risk

chance of loss

uncertainty concerning future outcome

relative variance of actual outcome from expected outcome

individual's perception of a risk. risk can involve positive &…

probability that event will occur

Risk

uncertainty concerning future outcome

objective risk

relative variance of actual outcome from expected outcome

Risk

Uncertainty

Loss Exposure

Objective risk

Uncertainty concerning the occurrence of a loss

used in situations where such probabilities cannot be estimated

Any situation or circumstance in which a loss is possible, reg…

is defined as the relative variation of actual loss from expec…

Risk

Uncertainty concerning the occurrence of a loss

Uncertainty

used in situations where such probabilities cannot be estimated

Enterprise RM

Risk (definition)

RM (definition)

Risk Profile

Considering all of the risks that an organization faces

Uncertainty concerning loss

The process of risk identification, risk analysis, selection a…

A set of characteristics common to all risks n a portfolio

Enterprise RM

Considering all of the risks that an organization faces

Risk (definition)

Uncertainty concerning loss

indirect losses

Driving at lower speeds in order to red…

Which one of the following method is a…

Examples of pure risk

lost profits from the interruption of the business

loss control

reduced level of risk activity

-injury to workers... -damage to assets... -legal liability... -higher…

indirect losses

lost profits from the interruption of the business

Driving at lower speeds in order to red…

loss control

Risk Management was concerned with the…

Expected Loss

Variance

Uncertainty about outcome

Pure and accidental loss

The expected loss (value) to be paid by an insurer; the averag…

Variability around expected value. Stocks - technology stock i…

Starting new job, driving a car, buying a home on the coast

Risk Management was concerned with the…

Pure and accidental loss

Expected Loss

The expected loss (value) to be paid by an insurer; the averag…

The core of Risk Management is the ____…

KNOWN risks need

UNKNOWN risks need

A probability of an event happening 100…

known

contingency plans////////////////// IF WE KNOW THE RISKS, WE N…

reserves (time or money)

...

The core of Risk Management is the ____…

known

KNOWN risks need

contingency plans////////////////// IF WE KNOW THE RISKS, WE N…

risk

loss exposure

objective risk

subjective (perceived) risk

traditional: uncertainty concerning the occurrence of a loss... i…

any situation or circumstance in which a loss is possible, reg…

relative variation of actual loss from expected loss; can be s…

uncertainty based on a person's mental condition or state of m…

risk

traditional: uncertainty concerning the occurrence of a loss... i…

loss exposure

any situation or circumstance in which a loss is possible, reg…

Risk

Loss exposure

Objective Risk

Law of large numbers

Uncertainty concerning the occurrence of a loss

Any situation or circumstance in which a loss is possible, reg…

Relative variation of actual loss from expected loss

As the number of exposure units increases, the more closely th…

Risk

Uncertainty concerning the occurrence of a loss

Loss exposure

Any situation or circumstance in which a loss is possible, reg…

Loss Exposure

Objective Risk

Subjective (Perceived) Risk

Chance of Loss

Any situation or circumstance in which a loss is possible, reg…

the relative variation of actual loss from expected loss

uncertainty based on a person's mental condition or state of m…

The probability that an event that causes loss will occur

Loss Exposure

Any situation or circumstance in which a loss is possible, reg…

Objective Risk

the relative variation of actual loss from expected loss

Risk

Loss exposure

Objective risk

Law of large numbers

Uncertainty concerning the occurrence of a loss

Any situation or circumstance in which a loss is possible, reg…

Degree of risk; the relative variation of actual loss from exp…

States that as the number of exposure units increases, the mor…

Risk

Uncertainty concerning the occurrence of a loss

Loss exposure

Any situation or circumstance in which a loss is possible, reg…

Acceptable Use Policy / rules of behavi…

ALE

ARO

AV

Agreed-upon principles put in place by a company to govern how…

Annual loss expectancy- A calculation used to identify risks a…

Annualized Rate of Occurrence- A calculation of how often a th…

The assessed value of an item

Acceptable Use Policy / rules of behavi…

Agreed-upon principles put in place by a company to govern how…

ALE

Annual loss expectancy- A calculation used to identify risks a…

two types of Islamic financial contracts

li-tijari contract

li-tabarru' contract

Universal complimentarity

li-tabarru' and li-tijari

the contract for the purpose of generating profit

contract that is made with the purpose of giving reward, aid o…

Every economic agent that is involved in a financial transacti…

two types of Islamic financial contracts

li-tabarru' and li-tijari

li-tijari contract

the contract for the purpose of generating profit

Risk

Loss Exposure

Objective Risk

Subjective Risk

historically has been defined as uncertainty concerning the oc…

any situation or circumstance in which a loss is possible rega…

the relative variation of actual loss from expected loss

uncertainty based on an individual's mental condition or state…

Risk

historically has been defined as uncertainty concerning the oc…

Loss Exposure

any situation or circumstance in which a loss is possible rega…

Risk Calculation

Risk

Acceptable use Policy/Rules of Behavior

Annual Loss Expectancy (ALE)

the process of calculating the risks that exist in terms of co…

the probability that a particular threat will occur, either ac…

agreed-upon principles set forth by a company to govern how th…

a calculation used to identify risks and calculate the expecte…

Risk Calculation

the process of calculating the risks that exist in terms of co…

Risk

the probability that a particular threat will occur, either ac…

Risk

2 Elements of Risk

Probability

Pure Risk

The uncertainty about outcomes, with the possibility that the…

1. Uncertainty of outcome... 2. Possibility of Negative Outcome

The likelihood that an outcome or event will occur

Chance of loss or no loss, but no chance of gain

Risk

The uncertainty about outcomes, with the possibility that the…

2 Elements of Risk

1. Uncertainty of outcome... 2. Possibility of Negative Outcome

What is Risk Management

What are the two core concepts ion Risk…

What is the decision making view in unc…

What is the information view in uncerta…

It is a process that enables organisations to identify potenti…

Uncertainty and Risk

1. The order or nature of things is unknown... 2. The consequence…

The degree to which available choices or the outcomes of possi…

What is Risk Management

It is a process that enables organisations to identify potenti…

What are the two core concepts ion Risk…

Uncertainty and Risk

Risk

Loss exposure

Objective risk vs Subjective risk

Objective probability vs Subjective pro…

uncertainty concerning the occurrence of a loss.

any situation or circumstance in which a loss is possible, reg…

the relative variation of actual loss from expected vs uncerta…

the long run relative frequency of an event based on the assum…

Risk

uncertainty concerning the occurrence of a loss.

Loss exposure

any situation or circumstance in which a loss is possible, reg…