QUESTION: 81

DRAG DROP (Drag and Drop is not supported)
As part of risk assessment exercise for a low-cost airline you are requested to match the risks listed below with the most approriate method of minimising or dealing with each risk.

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Answer(s): A

Explanation:

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QUESTION: 82

A patient has been prescribed a new medicine by their physician. The medicine is accompanied by a leaflet describing potential adverse effects associated with taking it. Most of these potentially adverse effects are trivial, but the leaflet states that three patients in every 10,000 who take the medicine suffer a severe reaction requiring urgent medical attention.
Which of the following statements is true?

Statistical probabilities mean very little in themselves when dealing with decisions that could have serious consequences, such as whether to take this medicine.
The patient should ignore the risk because there is only a 0.03% risk of a severe adverse reaction.
Statistically, the medicine is safe.
The patient should not be concerned because only those few patients who are susceptible to this reaction are at risk.

Answer(s): A

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QUESTION: 83

ERT is choosing between two maintenance policies for its vehicles. The outcomes of these policies are difficult to predict and so ERT has run a simu-lation of both. Policy 1 has an expected annual cost of $400,000 per year, with a standard deviation of $80,000. Policy 2 has an expected value of $350,000, with a standard deviation of $150,000.
Which of the following statements are correct?

Policy 2 is the more risky.
Policy 1 will always be the more expensive in any given period.
Policy 2 is the more likely to cost more than $500,000 in any given year.
Policy 2 has the greater potential upside risk.
Policy 2 is clearly the better policy.

Answer(s): A,C,D

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QUESTION: 84

H is a farmer. An outbreak of a contagious animal disease has just been detected near the region where the farm is located. This could potentially lead to substantial financial losses for H.

In these circumstances, which of the following responses by H is the most appropriate?

Avoid the risk by the immediate cessation of all animal farming activities and the sale or disposal of all animals currently held on the farm.
Reduce the risk by strict adherence to all government imposed animal movement restrictions, by the appropriate use of disinfectants and by similiar precautions.
Accept the risk and carry on as previously.
Transfer the risk by taking out a substantial level of insurance cover.

Answer(s): B

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QUESTION: 81

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QUESTION: 82

QUESTION: 83

QUESTION: 84