- CFA Exams
- CFA Level I Exam
- Study Session 19. Portfolio Management (2)
- Reading 55. An Introduction to Risk Management
- Subject 4. Measuring and Modifying Risks
CFA Practice Question
Which form is an example of risk acceptance?
B. A commercial bank sets aside sufficient capital to cover losses if needed.
C. A new driver purchases auto-insurance.
A. An auto-insurance company charges lower premiums if drivers have safe driving records.
B. A commercial bank sets aside sufficient capital to cover losses if needed.
C. A new driver purchases auto-insurance.
Correct Answer: B
A: risk prevention. C: risk transfer. B: self-insurance (risk acceptance).
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