Question 1

Commercial general liability insurance covers

Accepted Answer

A)  business interruption expenses. 
B)  injury to customers. 
C)  injury to employees. 
D)  profession liability. 
A)  business interruption expenses. 
B)  injury to customers. 
C)  injury to employees. 
D)  profession liability.

Question 2

Typically, the dollar values for employee lawsuits have start at

Accepted Answer

A)  $50,000 
B)  $100,000 
C)  $150,000 
D)  The amount differs from the above values. 
A)  $50,000 
B)  $100,000 
C)  $150,000 
D)  The amount differs from the above values.

Question 3

Monitoring social media is a form of risk transfer.

Accepted Answer

A) True 
 B)False

Question 4

Indemnification clauses should be reviewed by an insurance agent or broker to limit liabilities to a small business.

Accepted Answer

A) True 
 B)False

Question 5

Risk is

Accepted Answer

A)  a chance all entrepreneurs take. 
B)  a probability that adverse conditions will result. 
C)  a possibility of suffering harm or loss. 
D)  usually avoidable. 
A)  a chance all entrepreneurs take. 
B)  a probability that adverse conditions will result. 
C)  a possibility of suffering harm or loss. 
D)  usually avoidable.

Question 6

Brenda expects there will be uncertainty regarding the outcome of her business decisions. The final result of those decisions will not be known until she has ______________, developed strategies, and committed resources to her business.

Accepted Answer

A)  secured financing 
B)  purchased inventory 
C)  identified the investment opportunity 
D)  performed market research 
A)  secured financing 
B)  purchased inventory 
C)  identified the investment opportunity 
D)  performed market research

Question 7

Business risks can be classified into two broad categories-asset risk and pure risk.

Accepted Answer

A) True 
 B)False

Question 8

Business interruption insurance is

Accepted Answer

A)  included in a PPO policy. 
B)  may be part of an umbrella liability policy. 
C)  not recognized as important by small business owners. 
D)  part of a CGL no fault coverage plan. 
A)  included in a PPO policy. 
B)  may be part of an umbrella liability policy. 
C)  not recognized as important by small business owners. 
D)  part of a CGL no fault coverage plan.

Question 9

Quentin is getting quotes for insurance on his building. His agent recommends he purchase enough to cover the ___________________ even though this amount is more than Quentin paid for it.

Accepted Answer

A)  replacement value 
B)  actual cash value 
C)  coinsurance value 
D)  minimum value 
A)  replacement value 
B)  actual cash value 
C)  coinsurance value 
D)  minimum value

Question 10

Compensatory damages include ________ damages.

Accepted Answer

A)  economic 
B)  breach 
C)  tort 
D)  punitive 
A)  economic 
B)  breach 
C)  tort 
D)  punitive

Question 11

Bob and Tom are partners in a business. Discuss the types of insurance the business should carry if something should happen to one of the partners.

Accepted Answer

*Key person insurance. The business shou

Question 12

Match the term with its definition. Some terms may not be used.
-A defect resulting from failure to convey to the user that hazards are associated with a product or to provide adequate instructions on safe product use

Accepted Answer

A) Automobile insurance 
B) Coinsurance clause 
C) Crime insurance 
D) Design defect 
E) Manufacturing defect
F)Marketing defect
G)Noneconomic damages
H)Partially self-funded program
I)Proximate cause
J)Punitive damages
K)Workers' compensation legislation 
A) Automobile insurance 
B) Coinsurance clause 
C) Crime insurance 
D) Design defect 
E) Manufacturing defect
F)Marketing defect
G)Noneconomic damages
H)Partially self-funded program
I)Proximate cause
J)Punitive damages
K)Workers' compensation legislation

Question 13

Match the term with its definition. Some terms may not be used.
-A program that designates part of a firm's earnings to fund a portion of employee medical coverage

Accepted Answer

A) Automobile insurance 
B) Coinsurance clause 
C) Crime insurance 
D) Design defect 
E) Manufacturing defect
F)Marketing defect
G)Noneconomic damages
H)Partially self-funded program
I)Proximate cause
J)Punitive damages
K)Workers' compensation legislation 
A) Automobile insurance 
B) Coinsurance clause 
C) Crime insurance 
D) Design defect 
E) Manufacturing defect
F)Marketing defect
G)Noneconomic damages
H)Partially self-funded program
I)Proximate cause
J)Punitive damages
K)Workers' compensation legislation

Question 14

Matchteh term with its definition. Some terms may not be used.
-Buying insurance or making contractual arrangements that transfer risk to others

Accepted Answer

A) Disability insurance 
B) Personal property 
C) Proximate cause 
D) Real property 
E) Risk control
F)Risk financing
G)Risk management
H)Risk retention
I)Risk transfer
J)Self-insurance
K)Torts 
A) Disability insurance 
B) Personal property 
C) Proximate cause 
D) Real property 
E) Risk control
F)Risk financing
G)Risk management
H)Risk retention
I)Risk transfer
J)Self-insurance
K)Torts

Question 15

Matchteh term with its definition. Some terms may not be used.
-Wrongful acts or omissions for which an injured party can take legal action against the wrongdoer for monetary damages

Accepted Answer

A) Disability insurance 
B) Personal property 
C) Proximate cause 
D) Real property 
E) Risk control
F)Risk financing
G)Risk management
H)Risk retention
I)Risk transfer
J)Self-insurance
K)Torts 
A) Disability insurance 
B) Personal property 
C) Proximate cause 
D) Real property 
E) Risk control
F)Risk financing
G)Risk management
H)Risk retention
I)Risk transfer
J)Self-insurance
K)Torts

Question 16

Match the term with its definition. Some terms may not be used.
-The typical standard of care, based on what a reasonable or prudent person would have done under similar circumstances

Accepted Answer

A) Business interruption insurance 
B) Business owner's policy 
C) Commercial general liability insurance 
D) Disability insurance 
E) Indemnification clause
F)Key-person life insurance
G)Package policy
H)Personnel risks
I)Proximate cause
J)Reasonable standard
K)Workers' compensation insurance 
A) Business interruption insurance 
B) Business owner's policy 
C) Commercial general liability insurance 
D) Disability insurance 
E) Indemnification clause
F)Key-person life insurance
G)Package policy
H)Personnel risks
I)Proximate cause
J)Reasonable standard
K)Workers' compensation insurance

Question 17

Matchteh term with its definition. Some terms may not be used.
-Financing loss intentionally through a firm's cash flows

Accepted Answer

A) Disability insurance 
B) Personal property 
C) Proximate cause 
D) Real property 
E) Risk control
F)Risk financing
G)Risk management
H)Risk retention
I)Risk transfer
J)Self-insurance
K)Torts 
A) Disability insurance 
B) Personal property 
C) Proximate cause 
D) Real property 
E) Risk control
F)Risk financing
G)Risk management
H)Risk retention
I)Risk transfer
J)Self-insurance
K)Torts

Question 18

Match the term with its definition. Some terms may not be used.
-Coverage that provides benefits to a firm upon the death of key personnel

Accepted Answer

A) Business interruption insurance 
B) Business owner's policy 
C) Commercial general liability insurance 
D) Disability insurance 
E) Indemnification clause
F)Key-person life insurance
G)Package policy
H)Personnel risks
I)Proximate cause
J)Reasonable standard
K)Workers' compensation insurance 
A) Business interruption insurance 
B) Business owner's policy 
C) Commercial general liability insurance 
D) Disability insurance 
E) Indemnification clause
F)Key-person life insurance
G)Package policy
H)Personnel risks
I)Proximate cause
J)Reasonable standard
K)Workers' compensation insurance

Question 19

As a general rule, only ______ is insurable.

Accepted Answer

A)  business risk 
B)  market risk 
C)  pure risk 
D)  risk 
A)  business risk 
B)  market risk 
C)  pure risk 
D)  risk

Question 20

Discuss advantages and disadvantages to a company obtaining a BOP policy.

Accepted Answer

A business owner's policy (BOP) combines

Exam 23: A: Managing Risk in the Small Business

Commercial general liability insurance covers

Typically, the dollar values for employee lawsuits have start at

Monitoring social media is a form of risk transfer.

Indemnification clauses should be reviewed by an insurance agent or broker to limit liabilities to a small business.

Risk is

Brenda expects there will be uncertainty regarding the outcome of her business decisions. The final result of those decisions will not be known until she has ______________, developed strategies, and committed resources to her business.

Business risks can be classified into two broad categories-asset risk and pure risk.

Business interruption insurance is

Quentin is getting quotes for insurance on his building. His agent recommends he purchase enough to cover the ___________________ even though this amount is more than Quentin paid for it.

Compensatory damages include ________ damages.

Bob and Tom are partners in a business. Discuss the types of insurance the business should carry if something should happen to one of the partners.

Match the term with its definition. Some terms may not be used. -A defect resulting from failure to convey to the user that hazards are associated with a product or to provide adequate instructions on safe product use

Match the term with its definition. Some terms may not be used. -A program that designates part of a firm's earnings to fund a portion of employee medical coverage

Matchteh term with its definition. Some terms may not be used. -Buying insurance or making contractual arrangements that transfer risk to others

Matchteh term with its definition. Some terms may not be used. -Wrongful acts or omissions for which an injured party can take legal action against the wrongdoer for monetary damages

Match the term with its definition. Some terms may not be used. -The typical standard of care, based on what a reasonable or prudent person would have done under similar circumstances

Matchteh term with its definition. Some terms may not be used. -Financing loss intentionally through a firm's cash flows

Match the term with its definition. Some terms may not be used. -Coverage that provides benefits to a firm upon the death of key personnel

As a general rule, only ______ is insurable.

Discuss advantages and disadvantages to a company obtaining a BOP policy.

The Entrepreneurial Life

Integrity and Ethics: Foundations for Success in Small Business

Starting a Small Business

Franchises and Buyouts

The Family Business

The Business Plan: Visualizing the Dream

The Marketing Plan

The Organizational Plan: Teams, Legal Structures, Alliances, and Directors

The Location Plan

Understanding a Firms Financial Statements

Forecasting Financial Requirements

A Firms Sources of Financing

Planning for the Harvest

Building Customer Relationships

Product Development and Supply Chain Management

Pricing and Credit Decisions

Promotional Planning

Global Opportunities for Small Business

Professional Management and the Small Business

Managing Human Resources

Managing Operations

Managing the Firms Assets

Managing Risk in the Small Business

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