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Canada (158,081)
Finance (361)
FIN 502 (69)
Chapter 9

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Ryerson University
FIN 502
Steve Joyce

thChapter 9 Risk Management February 28 2012 Risk possibility of losing something valuableTwo types of Risks 1 Speculative Risk involves loss and gain but in uncertain amounts ex buying a lottery ticket common sharesprobability of winning and probability of losing rather than gambling 2 Pure Risk involves the possibility of loss only ex early death disability and theft of your carRisk Management Process 1 Identify the Risks most important stepTable 91 Significant Personal RisksTable 92 Evaluation of RisksTo avoid buying the wrong kind and wrong amount of insurance3 Types of Risks o Life and Health o Property o Liability to othersEnsure your property does not pose risk to third partyRule governing these sort of liabilities is the common law applying to torts legal wrongs or injuries one person causes anotherLimited corporations are liable for their actions or inaction but the limited liability means that the investors are not responsible beyond the amount of money paid for the investmentUnincorporated businesses and professionals are personally liable without limit for all the losses they cause2 Evaluating the RisksDeciding which risks
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