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Lecture

BUSA 364 Lecture Notes - Betta, Liability Insurance, Independent Contractor


Department
Business Admin
Course Code
BUSA 364
Professor
Keith Laidley

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The three steps in risk management are
o identification, evaluation, and response
- Alpha Corp has discovered that one of its products is potentially dangerous. It therefore
has purchased liability insurance. It has employed a form of risk management known as
o risk shifting
- Betta Inc has discovered that one of its products is potentially dangerous. It therefore
pulled that product from the store shelves before any were sold. It has employed a form
of risk management known as
o risk avoidance
- Gamma Co has discovered that one of its products is potentially dangerous. That danger,
however, is not great. There is only a small chance that someone will be hurt, and even if
someone is hurt, the injury will not be life-threatening. Gamma Co therefore has decided
to do nothing about the danger. It has employed a form of risk management known as
o none of the above
- In an effort to increase sales, Delta Ltd hired Chandra, a marketing expert. Because Delta
was concerned about being held responsible for any torts that Chandra might commit, it
arranged to hire her as an independent contractor, rather than an employee. It has
employed a form of risk management known as
o risk shifting
- Epsilon Inc has recently retained the services of Noriko as in-house counsel. Which of
the following statements is most likely true?
o Noriko can both help to resolve legal problems and help to prevent legal problems
from arising in the first place
- Which of the following statements is TRUE with respect to risk management and
incorporation
o Incorporation reduces the risk of liability because the doctrine of limited liability
usually means that a corporation’s debts must be paid by the corporation and not
by the people who run the corporation
- Which of the following statements is TRUE with respect to exclusion clauses and risk
management
o An exclusion clause can be inserted into a contract for the sale of goods
- Techniques for managing risks include
o incorporation, insurance, and exclusion clauses
- Red River Inc, which is based in Winnipeg, Manitoba, has sued a company called Eiffel
Tours, which is based in Paris, France. That dispute will be decided by the "common
law." That most likely means that the case will be decided by
o legal system that can be traced to England
- Which of the following statements is TRUE with respect to the law of Quebec?
o Even though Quebec inherited much of its law from France, it uses some of the
same laws that apply in other parts of Canada
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