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Determines (1) the method that will manage a specific risk-that is, identify whether it will be avoided, reduced, or accepted-and (2) the risk management device that will be applied to the threat This refers to the process of: Risk measurement Risk identification Selection of a risk management method None of the above Consider the following case: Red River Roadways, an American company, hauls freight for Canadian, U.S., and Mexican firms. It currently operates 75 trucks and 300 trailers in all three countries and invoices its customers in their local currencies. Company management is becoming increasingly concerned with its risk exposures and recently expanded the responsibilities of the chief financial officer (CFO) to include a risk management function. Which of the following statements regarding Red River's risk management activities are true? Check all that apply. Red River should purchase insurance for each of its risks that are insurable. One method that manages the language, licensing, and operational complexities and risks associated with using non-French-speaking drivers in Quebec province is to subcontract these deliveries to local Canadian freight companies. Red River's foreign exchange exposure, resulting from its peso and Canadian dollar revenues and expenses, cannot be managed using derivatives contracts. O Red River operates freight terminals in four U.S. cities, three Canadian cities, and two Mexican cities. The risk of damage to these buildings and their equipment could be protected by either buying insurance or leasing the property and equipment. An example of a risk facing Red River is rising fuel (diesel) costs. An increase in this critical input will reduce the firm's profitability

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