Managing Crisis and Risk Coursework Example | Topics and Well Written Essays - 2500 words

Managing Crisis and Risk - Coursework Example It is also for the effective and appropriate purchases and sales of the required financial assets. There are quite a number of techniques that are put into place for the modeling. Some of the measurers are the marketing risk, the historical simulation, the value at risk as well as extreme value theory. It is also important to highlight that a business should be guided appropriately with certain principles as well as theories for the successful operation of the business (Jacques, 2007). Just as the saying goes, for one to be successful; and rich, one must be ready to venture into a risky business. It is therefore of the fact that one bears all these risks in the action. It is important to highlight that risks are in segmented into different categories. These are credit risk, liquidity risks, Market risk as well as the operational risks (Jacques, 2011). These are risks that are anticipated in a financial institution or any business entity based on the credit transactions that occur or might have occurred during the moment of truth. It is important to highlight that for a credit transaction, it is important to consider the credit worthiness of the buyer, the financial status or position of the buyer, the frequency of the buyer purchasing firm the business entity, the credit worthiness of the buyer as well as the amount of stock that is available in the business entity. This helps the business people in evading certain risks after they become well equipped with the consumer knowledge. Under this category of risk, the following are the risks that form up this group: These are risks that are associated with the consumer either making a purchase or consuming the product or service or the consumer accessing some form of financial assistance. These in many cases are experienced in cases that the consumer thereby defaults in making payments. This thereby results into bad debts that would therefore force the financial managers or