A small fireworks manufacturer that shuts its plant down permanently because the risk of fire and the resulting losses are too great is relying on a risk ________ strategy.

Question

Quizplus · Accepted Answer

The manufacturer is avoiding the risk of fire by shutting down the plant permanently, thus opting for risk avoidance strategy. Reduction strategy would involve implementing safety measures to reduce the likelihood or impact of a fire, anticipation strategy involves preparing for potential risks, and transfer strategy involves transferring the risk to another entity (e.g. through insurance).

A Small Fireworks Manufacturer That Shuts Its Plant Down Permanently