John Strength owns and manages Strength Dynamics, which specialises in the design and manufacture of new...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
John Strength owns and manages Strength Dynamics, which specialises in the design and manufacture of new forms of exercise equipment. Strength Dynamics sells its equipment to health and fitness clubs island-wide. The nature of Strength's products exposes the firm to a variety of risks. Some examples include the possibility that someone might be injured on a piece of Strength's equipment and claim that it was improperly made. Another person might have a heart attack and die while working out, with the surviving family members claiming that the Strength's equipment was to blame. Strength has been conscientious about identifying and analysing the sources of risk to which it is exposed. Now the company must consider alternative ways to deal with those risks. It is possible that there may be some forms of equipment that Strength will not manufacture at all because of the high probability of serious losses. However, Strength is generally committed to the industry and in most cases wants to explore risk management alternatives that are compatible with continuing to produce a wide variety of new products. If Strength can determine ways to produce safer products that have a reduced likelihood of causing losses, the firm will examine the economic feasibility of alternative manufacturing/inspection processes. Similarly, Strength is interested in exploring ways to make the health and fitness clubs bear more responsibility for losses, even when they involve Strength equipment. Required: A. Explain the concept of 'risk avoidance and explain to Strength Dynamics when this would be an appropriate risk management technique for them. B. Discuss THREE (3) other risk management techniques with appropriate examples that Strength Dynamics may use in its business. C. What technique can be used by Strength Dynamics to make the fitness clubs bear some of the losses? John Strength owns and manages Strength Dynamics, which specialises in the design and manufacture of new forms of exercise equipment. Strength Dynamics sells its equipment to health and fitness clubs island-wide. The nature of Strength's products exposes the firm to a variety of risks. Some examples include the possibility that someone might be injured on a piece of Strength's equipment and claim that it was improperly made. Another person might have a heart attack and die while working out, with the surviving family members claiming that the Strength's equipment was to blame. Strength has been conscientious about identifying and analysing the sources of risk to which it is exposed. Now the company must consider alternative ways to deal with those risks. It is possible that there may be some forms of equipment that Strength will not manufacture at all because of the high probability of serious losses. However, Strength is generally committed to the industry and in most cases wants to explore risk management alternatives that are compatible with continuing to produce a wide variety of new products. If Strength can determine ways to produce safer products that have a reduced likelihood of causing losses, the firm will examine the economic feasibility of alternative manufacturing/inspection processes. Similarly, Strength is interested in exploring ways to make the health and fitness clubs bear more responsibility for losses, even when they involve Strength equipment. Required: A. Explain the concept of 'risk avoidance and explain to Strength Dynamics when this would be an appropriate risk management technique for them. B. Discuss THREE (3) other risk management techniques with appropriate examples that Strength Dynamics may use in its business. C. What technique can be used by Strength Dynamics to make the fitness clubs bear some of the losses?
Expert Answer:
Answer rating: 100% (QA)
A Risk avoidance is when a business chooses not to engage in an activity that poses risk For Strengt... View the full answer
Related Book For
Posted Date:
Students also viewed these finance questions
-
Create a MAIN PROGRAM IN JAVA that test the features of Client and ClientList classes according to program given below Client: import java.util.*; import java.lang.*; import java.io.*; public class...
-
Trevor Steel owns and manages Fitness Dynamics, which specializes in the design and manufacture of new forms of exercise equipment. Fitness Dynamics sells its equipment to health and fitness clubs...
-
Planning is one of the most important management functions in any business. A front office managers first step in planning should involve determine the departments goals. Planning also includes...
-
Let R denote the set of continuous functions with domain R (as in calculus). Then R is a commutative ring with identity. The additive identity OR is the zero function (that is, the function h(x)...
-
1. What is the relationship between the two sets A and B if A B = ? 2. What is the relationship between the two sets A and B if n (A B) = n (A) + n (B)? 3. Suppose that A and B are subsets of the...
-
Compare and contrast an employee's FICA tax payment responsibilities with those of a self-employed taxpayer.
-
Which of the following is an example of an input control? a. making sure that output is distributed to the proper people b. monitoring the work of programmers c. collecting accurate statistics of...
-
You need to read the article Ethical leadership and its challenges in the era of Globalization and do a presentation summarizing the article and then answering the following: Mr. Raymond Kim the...
-
1. log- (x+2) +C x+1 2. 6 log - x+3 3. log|x-1-5log|x-2+4log|x-3+C 4. log|x-1-2log|x-2+ log|x-3+C 5. 4log|x+2-2log|x+1+C 7. log|x-1-log (x+1)+tan 1 6. 8. x+2 3(x-1) 10. log|+1|og|x-1- +C GERT blished...
-
Kim Yi has prepared the following list of statements about accounts. 1. An account is an accounting record of either a specific asset or a specific liability. 2. An account shows only increases, not...
-
Salt in crude oil must be removed before the oil undergoes processing in a refinery. The crude oil is fed to a washing unit where freshwater fed to the unit mixes with the oil and dissolves a portion...
-
Write a c program that computes and prints out a list of double factorials from 1 to 20.
-
what is teamwork ? why is it important ? what intrigued you the most about teamwork ? Share your understanding of Workflow Design and Teamwork Share your PERSONAL experience with Workflow Design and...
-
Answer the following questions according to the given Ag-Cu system. 1200 T (C) 1000- 800 600- 400 200- 0 Ag (Ag) 10 Liquid 20 30 40 50 60 Mass % Cu 70 (Cu) 80 90 100 Cu C, melting temperature of...
-
28C Mostly cloudy (All sections must be filled out) Communicating with line management You can use this space to plan your ideas if you like but you must include the emails as attachments Create your...
-
- Given the hyperbola (x-5) 16 - (y-3)2 25 = 1, find the slope of the asymptotes.
-
An investor buys $8,000 worth of a stock priced at $40 per shareusing 50% initial margin. The broker charges 10% on the margin loanand requires a 30% maintenance margin. In 1 year the investor hasi 2...
-
Assume a simple Keynesian depression economy with a multiplier of 4 and an initial equilibrium income of $3,000. Saving and investment equal $400, and assume full employment income is $4,000. a. What...
-
Fake products make up 5 to 7 percent of world trade and include everything from counterfeit electronics, medications, pirated DVDs, and computer software to toys, cosmetics, and household products....
-
What key decisions must communicators make when developing and designing a marketing message?
-
How can Urban Outfitters best use the in-store sales force to amplify the positive effects of its promotional and reward programs? Provide specific ideas. These days, the clothing retailer landscape...
-
Golden Foods (GF) Ltd makes pies, pastries and pizzas, which it sells to retailers under its own brand-name and also supplies to a major supermarket chain. It has two sites: the bakery and its head...
-
What is depreciation?
-
Outline the principal accounting and disclosure differences between IAS 16 and FRS 102, Section 17.1.
Study smarter with the SolutionInn App