1. Assume that the chance of loss is 3 percent for two different fleets of trucks. Explain how it is possible that objective risk for both fleets can be different even though the chance of loss is identical. 2. a. What is the difference between peril and hazard? b. Define physical hazard, moral hazard, attitudinal hazard, and legal hazard. 3. a. Explain the difference between pure risk and speculative risk. b. How does diversifiable risk differ from nondiversifiable risk? 4. Briefly explain each of the following risk-control techniques for managing risk: a. Avoidance b. Loss prevention c. Loss reduction 5. Briefly explain each of the following risk-financing techniques for managing risk: a. Retention b. Noninsurance transfers c. Insurance 6. Explain the difference between a direct loss and an indirect or consequential loss citing at least two relevant examples each from UPSA 1. Assume that the chance of loss is 3 percent for two different fleets of trucks. Explain how it is possible that objective risk for both fleets can be different even though the chance of loss is identical. 2. a. What is the difference between peril and hazard? b. Define physical hazard, moral hazard, attitudinal hazard, and legal hazard. 3. a. Explain the difference between pure risk and speculative risk. b. How does diversifiable risk differ from nondiversifiable risk? 4. Briefly explain each of the following risk-control techniques for managing risk: a. Avoidance b. Loss prevention c. Loss reduction 5. Briefly explain each of the following risk-financing techniques for managing risk: a. Retention b. Noninsurance transfers c. Insurance 6. Explain the difference between a direct loss and an indirect or consequential loss citing at least two relevant examples each from UPSA