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Supplementary objective test questions

13.3 Company B’s risk committee recently met to discuss how the company might
respond to a number of problems that have arisen with one of its products, the
‘whatzis’. After a number of incidents in which the ‘whatzis’ had failed whilst
being used by customers, Company B has been presented with compensation
claims from customers injured and inconvenienced by the product failure.

The case mentions that the ‘whatzis’ is highly profitable and it may be that the
returns attainable by maintaining and even increasing the ‘whatzis’ sales are
worth the liabilities incurred by compensation claims.

When using the TARA framework, what is this an example of?

A A risk acceptance strategy

B A risk transference strategy

C A risk avoidance strategy

D A risk reduction strategy

13.4 Risk attitude is determined by

A Risk attitude and risk awareness

B Risk attitude and risk capacity

C Risk strategy and risk awareness

D Risk attitude and residual risk

13.5 The four strategies in TARA for managing risk do not include:

A Transference

B Approving

C Avoiding

D Accepting

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