Question

Morton is discussing with his insurance agent the possibility that he might lose his building and equipment in the event of a fire or windstorm. Should that happen, Morton's company would not be able to earn revenues. These two people are discussing _____ risk.

Answer 1

Answer:

pure risk

Explanation:

According to my research on different investment terminology, I can say that based on the information provided within the question these two people are discussing a term called pure risk. This term refers to a threat that is beyond human control and if it occurs will cause monetary loss, either in an investment of damage to an asset. Which is what will happen it the fire or windstorm that they are mentioning occurs.

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