This document defines and categorizes different types of risk. It discusses pure risks versus speculative risks, static risks versus dynamic risks, and subjective risks versus objective risks. It then defines risk management as a logical approach to solving problems businesses face due to the possibility of loss. The risk management process involves identifying risks, evaluating risks, selecting risk management techniques, and implementing and reviewing decisions on an ongoing basis.

1. Parishkar College Of
Global Excellence
submitted to :-
MR.DEEPAK SHARMA
DEAN OF P.I.C. submitted by :-
VISHAL SHARMA
BBA 3rd sem.

2. Risk
Risk can be defined as the variability in possible outcomes
of an event based on chance,or risk can be defined as
uncertainty concerning loss. the degree of risk refers to
accuracy with which an event based on chance can be
predicted.

3. Types of risks
pure risks speculative risks
static
dynamic static dynamic
subjective objective subjective objective
subjective
objective
subjective
objective

4. Pure versus speculative risks
a. pure risk:- it exists when there is uncertainity as to
wether loss will occur or not.
b. speculative risk:- it exist when there is uncertainity about
an event that could produce either a profit or a loss.

5. Static versus dynamic risks
(A) static risk:-it can be either pure or speculative,and
stems from an unchanging society that is in stable
equilibrium.
(b) dynamic risks:- these are produced becouse of changes
in the society. dynamic risk can be either pure or
speculative.

6. Subjective versus objective risks
a. subjective risk:- it refers to the mental state of an
individual who experiences doubt or worry as to the
outcome of a particular event.
b. objective risk:- it differs from subjective risk primarily in
the sense that it is more precisely observable and
therefor,measurable.it is the probable variation of actual
from the expected experience.

7. Risk management
Acc. to mark s. dorfman,” risk management
is a logical approach to solving those problems
a business faces becouse it is expected to the
posibility of loss”.

8. Risk managment process
1. Identifying the risk:- there are many potential risks that
confront individuals and businesses.tharefor,the first
step in the risk management process is to identify the
relevant exposure to risks.
2. Evaluating the risk:- for each source of risk that is
identified,an evaluation should be performed.at this
stage,pure risk can be categorised as to how often
associated losses are likely to occur.

9. 3. selecting risk management techniques:-the result of the
analysis in step 2 are used as the basis for decision
regarding ways to handle the existing risks.
4. implementing and reviewing the decision:- following a
decision about the optimal method for handling identified
risks,the business or an individual must implement the
techniques selected.
however,risk management should be an ongoing process
in which prior decision are reviewed regularly.