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P3 – Risk Management

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Showing 4–6 of 15 questions

Question 4

Which of the following statements are true of economic risk?

Select all that apply, then click Submit answer.

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    Economic risk is easy to measure
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    Economic risk may be caused by international trade
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    Economic risk is something which cannot be avoided
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    Economic risk is influenced by many factors
Question 5

Kate is a management accountant. Her immediate superior plans to apply for a promotion and his strongest competitor is the sales manager. Kate's superior has ordered her to set unattainable sales targets in a sales budget in order to reduce the sales manager's promotion prospects. He told her not to tell anybody.

Kate asked the finance director for advice. He told her that he wanted her immediate superior to get the promotion and so she should set the unattainable budget as instructed.

Kate set the budget as instructed.

Which THREE fundamental ethical principles has Kate breached?

Select all that apply, then click Submit answer.

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    Integrity
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    Objectivity
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    Professional competence and due care
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    Confidentiality
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    Professional behaviour
Question 6

TYU is a retailer selling televisions. The company is financed wholly by equity.

Why might TYU be exposed to interest rate risk?

Select all that apply, then click Submit answer.

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    Customers' disposable income may change.
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    TYU's competitors may have variable rate borrowings.
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    TYU's suppliers may have borrowings.
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    TYU's cost of capital will vary with interest rates.
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    TYU's competitors may have fixed rate borrowings.