Steve is a division controller of Pharm Quick, Inc., a publicly traded multinational corporation, which manufactures medical devices.As part of its business, the company also provides financing services to its customers. In the recent times, the medical equipment business has become highly competitive and many companies have filed for bankruptcy. Additionally, owing to the changes in regulations, many competitors have been subject to indictments and fines.Considering the above changes in the industry, Steve feels that it is imperative to take preventive actions to be able to sustain a healthy growth for Pharma Quick. Accordingly, he wants to integrate enterprise risk management into the culture and operations of the corporation and ensure that the company is in compliance with the requirements of the Sarbanes-Oxley Act of 2002.From the first five scenarios given in the question are the potential risky areas, for each of the given scenarios, identify the type of risk. In the next five questions discuss the Risk Mitigation Strategy and Risk Response to each of the scenarios.Select any one correct answer from the choices given.

Question 1 - When purchasing raw material from other countries what is the type of risk?

Market Risk

Credit Risk

Financial Risk

Question 2 - While providing financial services to customers what type of risk can the organization face?

Credit Risk

Financial Risk

Operational Risk

Market Risk

Question 3 - While developing and manufacturing high-tech equipment what kind of risk can the organization face?

Operational Risk

Market Risk

Credit Risk

Financial Risk

Question 4 - In case there are changing governmental policies on healthcare what risk would be faced?

Operational Risk

Credit Risk

Financial Risk

Market Risk

Question 5 - In case of decline in bond price due to a downgrade in its rating by the credit agencies the organization faces what kind of risk?

Financial Risk

Credit Risk

Operational Risk

Market Risk

Question 6 - Discuss the discuss the Risk Mitigation Strategy and Risk Response when purchasing raw material from other countries?

Insurance- Risk Sharing

Hedging- Risk Reduction

Insurance- Risk Reduction

Hedging- Risk Sharing

Question 7 - Discuss the Risk Mitigation Strategy and Risk Response while providing financial services to customers?

Insurance- Risk Reduction

Insurance- Risk Sharing

Insurance- Risk Avoidance

Hedging- Risk Sharing

Question 8 - Discuss the Risk Mitigation Strategy and Risk Response for developing and manufacturing high-tech equipment?

Lease equipment-Risk Reduction

lean Manufacturing- Risk Avoidance

Lean manufacturing- Risk Reduction

Lease equipment-Risk Avoidance

Question 9 - In case there are changing governmental policies on healthcare what kind of risk mitigation strategy can be used and what is the appropriate risk response?

Regulatory Compliance- Risk Avoidance

Regulatory Compliance- Risk Sharing

Regulatory Compliance- Risk Collusion

Question 10 - In case of decline in bond price due to a downgrade in its rating by the credit agencies what kind of risk mitigation strategy can be used and what is the appropriate risk response?

Ensure timely payments- Risk Collusion

Ensure timely payments- Risk Avoidance

Ensure timely payments- Risk Sharing

Ensure timely payments- Risk Reduction