Portfolio Management Q168

168Two students make the following statements:

Student 1: The risk tolerance decision begins with analysis of an “inside” view and an “outside” view. The first deals with the shortfalls in the internal environment of the organization that could lead to failure. The later deals with outside uncertain forces that the organization is exposed to.

Student 2: The risk tolerance decision begins with analysis of a “Proactive” view and a “reactive” view. The first deals with outside uncertain forces that the organization is exposed to. The later deals with the shortfalls in the internal environment of the organization that could lead to failure.

Which student’s statement is most likely correct?

Option : A
Explanation : The risk tolerance decision begins with analysis of an “inside” view and an “outside” view. The first deals with the shortfalls in the internal environment of the organization that could lead to failure. The later deals with outside uncertain forces that the organization is exposed to.

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