Risk Management & Credit-Based Relationships Chapter Exam

Exam Instructions:

Choose your answers to the questions and click 'Next' to see the next set of questions. You can skip questions if you would like and come back to them later with the yellow "Go To First Skipped Question" button. When you have completed the practice exam, a green submit button will appear. Click it to see your results. Good luck!

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Question 1 1. Richard and Susan are buying appliances for their new house. The appliances served as collateral for the loan, which is called _____.

Question 2 2. Celine wants to buy a brand new house and borrows money from the National Commercial Bank. In exchange, she gives the bank a legal claim to the house. What is true about the house?

Question 3 3. How does technological change affect risk management?

Question 4 4. Which of the following is an example of installment credit?

Question 5 5. Jonathan bought a car and offered it as collateral to the bank for a loan. Choose the statement that is TRUE after Jonathan's loan has been disbursed.

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Question 6 6. Paul hires Andy to be his sports agent. Paul hires Andy specifically to negotiate his NFL contract for the upcoming football season. Andy tries, but there aren't any NFL teams currently interested in Andy and recruiting season is now over. What is the state of this agency relationship?

Question 7 7. Zuk company Ltd. decides to launch a brand new type of bicycle called the Zukbike. The company accepts this risk and is prepared to pay for the losses that may occur. Which type of risk management approach is being used by the company?

Question 8 8. Which of the following is NOT a step in the risk management process?

Question 9 9. Paul hires Andy to be his sports agent. Paul hires Andy specifically to negotiate his NFL contract for the upcoming football season. Shortly afterward, Paul and Andy have a disagreement. Paul tells some of his friends that he no longer wants to work with Andy. What is the state of this agency relationship?

Question 10 10. Which of the following is an example of an environmental change related to an economic factor?

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Question 11 11. Which type of credit requires you to pay the total balance in 30, 60, or 90 days?

Question 12 12. Which type of credit allows you to request a limit increase if payments are made on time?

Question 13 13. Jack borrows money from his friend Jill in order to buy a laptop. Jill is a:

Question 14 14. Anne borrows money from the bank in order to buy a tractor for her farm. In exchange, she gives the bank a legal claim to the tractor. This legal claim is called a:

Question 15 15. Rick loses his job and is unable to make house payments for several months. His bank moves to seize the house by _____.

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Question 16 16. Which one of the following is an example of environmental change related to the external political environment?

Question 17 17. Samantha is a CEO of a large marketing company. She is trying to determine what external factors may impact the business in the next few months. She is concerned about the 2018 midterm elections and has decided to invest money into a PAC of a pro-business independent candidate. Another cause for concern is the increasing number of complaints regarding her IT sector. Which of the following may impact her business, and how can she manage these factors?

Question 18 18. Shawna has been saving for a year to purchase a flat screen TV. When she visits an electronics store, they ask her to complete a credit application just in case she doesn't want to use her cash. Shawna is approved for revolving and installment credit as well as a 90 days same as cash option. Which choice is best if her goal is save on interest?

Question 19 19. Which of the following management decisions involves risk reduction?

Question 20 20. If a company purchases an insurance policy, which type of risk management approach is it using?

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Question 21 21. Paul borrows money from a leasing company in order to buy a truck for his business. In exchange, he gives the lender a legal claim to the truck. This scenario is an example of a:

Question 22 22. Which one of the following is NOT a step involved in risk management?

Question 23 23. The bank sells John's house at an auction. Unfortunately the selling price is less than what he still owes on the house, so John is forced to pay the difference through a _____.

Question 24 24. Paul hires Andy to be his sports agent. Paul hires Andy specifically to negotiate his NFL contract for the upcoming football season. Shortly afterward, Paul breaks his leg and can't play football for several months. What is the state of this agency relationship?

Question 25 25. What type of debt is credit card borrowing?

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Question 26 26. How is risk related to insurance?

Question 27 27. Terry used installment credit to buy a $10,000 car. She has made 10 payments of $1,000 each and has requested the title (ownership papers) to the car. Will Terry get the title?

Question 28 28. Paul hires Andy to be his sports agent. Paul hires Andy specifically to negotiate his NFL contract for the upcoming football season. Shortly afterward, Paul meets Angie. Angie has more agent experience. Paul calls Andy and fires him so that he can hire Angie. What is the state of this agency relationship?

Question 29 29. Paul hires Andy to be his sports agent. Paul hires Andy specifically to negotiate his NFL contract for the upcoming football season. Shortly afterward, Paul breaks his back and is paralyzed. He can't play football ever again. What is the state of this agency relationship?

Question 30 30. What is a secured loan, in which a real property is given as collateral, called?

Risk Management & Credit-Based Relationships Chapter Exam Instructions

Choose your answers to the questions and click 'Next' to see the next set of questions. You can skip questions if you would like and come back to them later with the yellow "Go To First Skipped Question" button. When you have completed the practice exam, a green submit button will appear. Click it to see your results. Good luck!

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