Which of the following statement is correct?

The total cost of risk does not include the cost of insurance.

All the answers are incorrect.

$"$In the context of agency problem, management compensation contracts $($e$.$g$.,$

bonuses$)$ does not motivate nianagers to maximize shareholder value.

Risk imposes costs on businesses and individuals.

Minimizing the cost of risk implies that the variability of losses is also minimized.