RMI 378 Final

Which one of the following statements is true regarding the basic measures that apply to risk management?

C. Consequences measure the degree to which an occurrence could positively or negatively affect an organization.

Insurance Company monitors key indicators of underwriting effectiveness. Some indicators they monitor include: percentage of business quoted that was written, application processing time, premium volume handled by underwriters, skill level of underwriters, and benchmarking between different underwriting offices. The indicators of underwriting performance Insurance Company uses are called

C. Control indicators.

Commercial general liability insurance policies written on an occurrence basis apply to bodily injury and property damage that occurs during the policy period. This provision supports the principle that insurable loss exposures must ideally be

C. Definite.

Taylor owns Paoli Hardware, a mid-sized hardware store with 25 employees. Paoli Hardware has won best local hardware store 3 years in a row. Taylor would like to expand operations and has undertaken a SWOT analysis. His most dedicated customers are generally over 40 years old and engaged in small house projects, but his biggest revenue generator continues to be the sale of lumber. He would like to obtain more commercial customers and increase lumber sales. One of the major complaints Taylor hears from his customers is the difficulty finding local contractors. So, he is considering hiring a general contractor at the store who would also make house calls to assist customers. This will allow him to bill for labor and increase the sale of his products, but he is concerned it may increase his insurance claims and premiums. One of the younger store employees suggested they create a website to expand sales to on-line purchases and target electronic advertisements to commercial accounts. Taylor is not sure that he has the expertise to maintain a website and run the store. The employee claims to know a company that can maintain a website for Paoli at minimal cost. Taylor believes the website is a good idea and will increase sales of lumber. To protect Paoli from increases in the cost of lumber, Taylor is considering a forward contract with the lumber yard. If Taylor completed a PESTLE analysis instead of a SWOT analysis, the PESTLE analysis would include which one of the following?

C. Increase in competition

Oscar's custom-built vehicle looks like a sausage sandwich on wheels. He plans to drive it to special events at schools around the country where it will serve as a mobile billboard to promote his product. Oscar is surprised to learn that insurers are reluctant to insure his vehicle because it fails to meet one of the ideal characteristics of an insurable risk. Which characteristic is Oscar's vehicle least likely to meet?

C. Large number of similar exposure units

Mid-State Packing Company, a meat processing company, is the largest private sector employer in Metro City. First National Bank of Metro City loans money to Mid-State Packing Company and to many of the employees of Mid-State. The problem with First National Bank of Metro City loaning money to both the business and many employees of the business is that

C. Loan defaults are likely to be highly correlated.

BONUS: The risk management professional for a large multi-location super market chain in the New England area observed that all of the buildings have a flat roof. His concern is primarily due to the possible loss resulting from

C. Weight of snow, sleet, and ice.

In an effort to grow its personal lines book, an insurer decides to offer discounts on homeowners and personal auto insurance to the employees of its largest business lines account. Which one of the following risk measures is most likely to increase as a result of this marketing decision?

Correlation

Blithe Drug Manufacturing has developed a drug that cures obesity. However, the side effects are significant and potentially fatal. Blithe decides not to manufacture and sell the drug. This is an example of

A. Avoidance.

The basic accounting equation on which the balance sheet is structured is

A. Assets = Liabilities + Net Worth

Fred is a nurse working the first shift at Save our Souls Hospital (SOS). He is the only man and the only unmarried nurse on that shift. He also has more seniority than all but one other nurse on his shift.

A. Disparate treatment

Alice is an assembly-line worker in an auto parts manufacturing plant. One day she notices some irregularities in the operation of the punch press. Concerned about meeting production goals, she continues to operate the punch press without reporting the malfunction. Later that day, the punch press shatters, injuring Alice and several of her co-workers. This example BEST illustrates the accident causation theory of the

A. Domino theory.

A local shopping center reduced its net income loss after a fire by incurring additional expenses to shorten the time it takes to repair the damage and reopen the shopping center. Bob, the owner of the center, hired a contractor to work around the clock until repairs were completed. This reduced Bob's net income loss because he was able to repair the shops sooner. Bob's action is an example of which one of the following risk management techniques?

A. Loss reduction

If an organization directly securitized its income-producing assets without using a special purpose vehicle (SPV) as an intermediary, investors

A. Must consider the overall credit risk of the organization.

Advancements in machine learning and artificial intelligence (AI) have helped insurers do all of the following, EXCEPT:

C. Completely prevent customers' risk

Decision tree analysis and event tree analysis are similar in a number of ways, but differ in their

A. Purpose.

Chuck is Vice President of Claims for Insurance Company. The company has 37 adjusters in the field, and needs to hire four new adjusters. Chuck is curious about the relationship between prior experience of the adjuster and policyowner complaints. He collected data on the number of complaints for each adjuster on staff over time. Then he used a statistical technique to analyze the relationship between adjuster experience and complaints, and the trend of the relationship over time. The statistical analysis confirmed that that there were significantly fewer complaints with more experienced adjusters, and that the relationship grew stronger with more years of experience. The technique Chuck used to relate indicators to outcomes is called

A. Regression analysis.

Risk appetite is an important component of strategic risk management (SRM). Which one of the following statements is correct with respect to an organization's risk appetite?

A. Regulatory conditions, political risks, and anti-trust or other legal concerns can reduce an organization's risk appetite.

Which one of the following is the first step in the text mining process?

A. Retrieve and prepare text with preprocessing techniques

Which one of the following statements is true regarding sources of risk affecting property exposures?

A. Risk control techniques can usually manage the likelihood and consequences of human risk sources to some extent.

Internet of Things (IoT) devices, sensors, wearables, and telematics devices have had the greatest impact on which one of the following risk treatment techniques?

A. Risk modification

SoCal Movie Company produces movies at a studio in Southern California. The risk manager decided to identify the range of potential consequences associated with various risks that the company faces. For example, if a severe earthquake occurred while the company was filming a movie, there could be deaths and injuries, destruction of movie sets, delays in production, costs associated with filming at an alternative location, and loss of reputation and good will. The type of analysis performed by the risk manager is called

A. Scenario analysis.

Which one of the following statements is most accurate?

A. The text in organizational files, social media posts, news stories, consumer reviews, and so forth is not automatically meaningful to a machine or an algorithm.

The board of directors of Insurance Company wants assurance that the company's recently-instituted "commitment to risk management" has been communicated to and accepted by ALL company employees. Which one of the following would be the best method to determine if employees had been informed of the commitment to risk management and had accepted it?

B. Ask the internal audit department to administer a risk management questionnaire to employees.

An advantage of a large deductible plan is that it allows the insured organization to

B. Benefit from the cash flow available on the retained loss reserves.

Which one of the following technologies can provide the infrastructure upon which smart contracts are built and implemented?

B. Blockchain

An analysis that projects the effects a given system change is likely to have on an existing system is known as

B. Change analysis.

Tom, the regional manager at Westfork Mutual, has planned a community service day for all employees. He has asked his two assistant managers, Julian and Leah, to spread the word to other employees and encourage them to attend. Based on centrality measures of the company's email traffic, Tom is confident that Julian will spread the word to more employees more quickly through email than will Leah. Tom's confidence is based on Julian's high score in which one of the following centrality measures?

B. Closeness

Some buildings have modest economic value but still have high replacement costs. One prime reason for this might be because of

B. Construction styles that are large or ornate.

Jeremy purchased some long-term corporate bonds when he retired. He plans to use the periodic interest payments from the bonds to supplement his other sources of retirement income. However, some of the companies that issued the bonds that Jeremy purchased may become insolvent and unable to make periodic interest payments. This risk that Jeremy took when he invested in the corporate bonds is called

B. Credit risk.

Which one of the following statements is true if earnings at risk are $200,000 with 90% confidence?

B. Earnings at risk are projected to be less than $200,000 10% of the time.

Which one of the following statements about event tree analysis is true?

B. Event trees analyze the consequences of accidental events.

Directors and officers of a corporation owe special duties to the stockholders of that corporation. Those duties include: the duty of care; the duty of loyalty; the duty of disclosure; and the duty of obedience. What is the term used to describe these duties?

B. Fiduciary

An organization practicing holistic risk management would assess the cost of raw materials and foreign exchange risk under which one of the following quadrants of risk?

B. Financial risk

Which one of the following is a benefit of the conditional value at risk (CVaR) method?

B. It takes into account the extremely large losses that may occur.

On a local television program, a financial reporter stated, "There will be big news this week about Sixth National Bank's bad real estate development loans. Unless they get acquired soon, the bank will be broke." The next morning, long lines of depositors waited outside of each Sixth National Bank branch. When the branches opened, depositors began withdrawing their funds. Sixth National Bank did not have enough funds to pay all the depositors and had to close early, which only further compounded the problem. Which one of the following financial risks is Sixth National Bank facing by not having enough cash on hand to meet the immediate demand?

B. Liquidity risk.

Which one of the following statements is true regarding operational risk?

B. Operational risk is integrated in every activity of an organization.

The balance sheet provides a snapshot of an organization's financial condition

C. At a given point in time.

Jane always drives to visit her children who live one thousand miles away. She enjoys driving and feels safer in a vehicle than on an airplane because she feels she has more control of her fate. This driving versus flying decision is an example of

B. Subjective risk.

Which one of the following statements is true regarding a generic model of a securitization?

B. The organization sells income-producing assets to an SPV in exchange for cash.

The focus of risk quadrants is different from the focus of risk classifications in general. While the classifications of risk focus on some aspect of the risk itself, the four quadrants of risk focus on

B. The source of risk and who has traditionally managed it.

In addition to metal detectors, many airports have installed a second type of scanning technology for checked baggage and cargo. The checked bags and cargo pass through a portal with scanners programmed to detect and test for explosive trace fumes. These scanners, which detect explosives based on air samples, are an example of what type of sensor used for risk assessment and control?

Biochemical sensors

Which one of the following is described as a distributed database that serves as a collectively shared ledger?

Blockchain

Bonus: An exculpatory clause is

C. A contractual provision that relieves one party from liability resulting from a negligent or wrongful act.

Sixth National Bank stores all of its financial records in an electronic data base. Sixth National customers are able to access their accounts on-line with a user identification number and a password. Last weekend, a computer hacker was able to breach the firewall of the electronic database and gain access to customer account data. This operational risk for Sixth National Bank is

C. A systems risk.

Which one of the following statements is true concerning robotic process automation (RPA)?

C. Although RPA can help control some organizational risks, use of RPA can create other risks.

Which one of the following statements is correct regarding formulating an organization's long-term strategies?

C. Long-term strategies to improve performance and/or create a competitive advantage, are based on the organization's goals and analysis of internal and external environments.

Which one of the following valuation standards is most appropriate for valuing products that are relatively indistinguishable from one another, such as agricultural products, oil, or precious metals?

C. Market value

The use of risk quadrants to identify and categorize risk can provide a framework for risk identification. One quadrant includes such risks as loss of production due to a key supplier not delivering raw materials or a mechanical breakdown of equipment. This risk quadrant is

C. Operational risk.

An example of a post-loss action for the windstorm cause of loss is

C. Patrolling premises to prevent looting or vandalism.

Which one of the following risk management objectives is critical for a manufacturer seeking new capital from investors, stockholders, and creditors?

C. Reduce the deterrent effects of hazard risks

A major benefit of involving a special purpose vehicle (SPV) in a securitization transaction is that investors can decide whether to invest in the securities based on the

C. Risk presented by the income-producing assets held as collateral by the SPV.

Cold Coolers, Inc., has its main warehouse in St. Louis. It also stores inventory in two warehouses in other cities to reduce the distance between their warehouses and retail locations. Cold Coolers is using which one of the following risk management techniques?

C. Separation

Hardware Store has been able to control its prices and inventory since it has no competitors. A new highway currently being constructed is going to allow increased competition for Hardware Store. According to the quadrants of risk, this risk of increased competition falls into the category of

C. Strategic risk.

Taylor owns Paoli Hardware, a mid-sized hardware store with 25 employees. Paoli Hardware has won best local hardware store 3 years in a row. Taylor would like to expand operations and has undertaken a SWOT analysis. His most dedicated customers are generally over 40 years old and engaged in small house projects, but his biggest revenue generator continues to be the sale of lumber. He would like to obtain more commercial customers and increase lumber sales. One of the major complaints Taylor hears from his customers is the difficulty finding local contractors. So, he is considering hiring a general contractor at the store who would also make house calls to assist customers. This will allow him to bill for labor and increase the sale of his products, but he is concerned it may increase his insurance claims and premiums. One of the younger store employees suggested they create a website to expand sales to on-line purchases and target electronic advertisements to commercial accounts. Taylor is not sure that he has the expertise to maintain a website and run the store. The employee claims to know a company that can maintain a website for Paoli at minimal cost. Taylor believes the website is a good idea and will increase sales of lumber. To protect Paoli from increases in the cost of lumber, Taylor is considering a forward contract with the lumber yard. Which one of the following could Taylor's SWOT analysis consider an opportunity or a threat, or both an opportunity and a threat?

C. Technological advancements

A main difference between decision trees and event trees is

C. That event trees analyze the consequences of accidental events rather than decisions.

Which one of the following statements is true regarding the strategic management process?

C. The strategic management process can be applied to any type of organization, including business, not-for-profit organizations, and government entities.

Taylor owns Paoli Hardware, a mid-sized hardware store with 25 employees. Paoli Hardware has won best local hardware store 3 years in a row. Taylor would like to expand operations and has undertaken a SWOT analysis. His most dedicated customers are generally over 40 years old and engaged in small house projects, but his biggest revenue generator continues to be the sale of lumber. He would like to obtain more commercial customers and increase lumber sales. One of the major complaints Taylor hears from his customers is the difficulty finding local contractors. So, he is considering hiring a general contractor at the store who would also make house calls to assist customers. This will allow him to bill for labor and increase the sale of his products, but he is concerned it may increase his insurance claims and premiums. One of the younger store employees suggested they create a website to expand sales to on-line purchases and target electronic advertisements to commercial accounts. Taylor is not sure that he has the expertise to maintain a website and run the store. The employee claims to know a company that can maintain a website for Paoli at minimal cost. Taylor believes the website is a good idea and will increase sales of lumber. To protect Paoli from increases in the cost of lumber, Taylor is considering a forward contract with the lumber yard. Which one of Porter's Five Forces is most greatly affected by Paoli's ability to negotiate a forward contract with a lumber supplier?

C. The suppliers bargaining power to drive prices up.

A chart showing the probability of obtaining the numbers one through six on one roll of one die represents a

C. Theoretical probability distribution.

Clark's Electronics is considering launching new technology for the medical industry. Before investing major resources in the project, the company decided to perform a SWOT analysis. The fact that there are new medical industry regulations pending would fall under which one of the following quadrants of a SWOT analysis?

C. Threats

Patrick works in the benefits department at a company whose responsibilities involve selecting investments that support the employee benefit plan. One of the investment options happens to be at a firm where Patrick's friend works. He knows the friend could use the money that would come from the substantial investment the benefit plan would create. Despite the fact there are more sound investments, Patrick decides to invest heavily in the friend's company. The investments perform adequately. Is this a violation of Patrick's fiduciary duties?

C. Yes, he has a duty to act solely in the interest of the plan and participants.

The National Oceanic and Atmospheric Administration (NOAA), a U.S. Government agency, monitors tsunami risk. Earthquakes under the sea often cause large waves which can have a disastrous impact on coastal communities. In addition to monitoring earthquake data and tides, NOAA recently added a new tool -- tsunami detection buoys. The buoys are placed in the sea and they are equipped with sensors to detect high wave levels so that an early warning can be given to a coastal area if an evacuation is needed. This application of the use of smart products illustrates their use in

Catastrophe management.

The theoretical probability of a head on a coin toss is 50%. Based on the law of large numbers, which one of the following is the number of coin tosses most likely to result in an empirical frequency of 50% receiving a head on a coin toss?

D. 100

Which one of the following statements about root cause analysis (RCA) is true?

D. A root cause must produce effective recommendations for prevention of future accidents.

BONUS: Which one of the following statements about blockchain is true?

D. Blockchain stores a record of transactions across a network of servers.

Three HillsLaw is a legal firm specializing in multiple-plaintiff cases. One current case involves alleged birth defects caused by exposure to polluted groundwater. There are currently 78 plaintiffs represented in the pending legal action. Up-to-date records on the condition of each child is a critical operational concern. Three HillsLaw turned to a secured digital ledger system in which independent third parties (nurses, physicians, and parents) can update the status of individual children, and the record for the entire group is automatically updated. The latest update showed seven children have died, 14 have a terminal diagnosis, 27 have permanent disabilities, and 30 cases are listed as "developing" (awaiting definitive diagnosis). The secured distributed ledger system used by Three HillsLaw is called

D. Blockchain.

Big data includes

D. Both structured and unstructured data.

A risk manager for a grocery store wants to see if there is a correlation between the frequency of customer slip and fall accidents, and the time of day. Which one of the following is a relatively simple data analysis technique that the risk manager could use to determine this correlation?

D. Bubble plot

The second step in the root cause analysis (RCA) process is charting the agents that directly result in one event triggering another event. In RCA, these agents are called

D. Causal factors.

Nancy, the general liability claims manager, is concerned about a significant rise in claim frequency in the state of New Jersey during the past 18 months. She cannot identify the cause of the increase and has asked James, a data analyst, to help. James decides to develop a model to analyze the dataset of New Jersey claims, and see if any previously unknown grouping can be identified for further analysis. Which one of the following data analysis techniques is James using?

D. Cluster analysis

One financial risk for an insurer is that the insured will not pay all of the premiums when the premiums are due. This type of risk is called

D. Credit risk.

A construction company based in the U.S. has building contracts in five different foreign nations. The construction company agreed to accept payment for its work in each country's currency. The risk of loss of value when these foreign payments are converted to U.S. dollars is called

D. Exchange-rate risk.

One of the levels of risk a business faces is the risk of accidental loss, including the possibility of loss or no loss. This category of risk is

D. Hazard risk.

Bonus: A worker for Build-Rite Construction Company removed the pressure gauge and warning sticker from an air compressor. The pressure gauge automatically shuts off the compressor when the pressure gets too high. The sticker warned that an explosion could result if the pressure was too high. Without the pressure gauge in place, the air compressor exploded. The explosion killed one worker and severely injured another. If Build-Rite performs a root cause analysis (RCA) of this fatal accident, which one of the following might be determined to be a root cause?

D. Inadequate training

Like most insurance companies, the majority of Insurance Company's portfolio is invested in bonds. If interest rates increase, the value of the bonds in the portfolio will decrease. This risk to Insurance Company is called

D. Interest rate risk.

Certain types of property losses such as drought, flood, and earthquake are referred to as natural because

D. It is beyond human control.

An organization must meet the standard of care that it owes to others in order to ensure that

D. Legal obligations are satisfied.

Large deductible plans

D. Lower an organization's cost of risk.

Risk indicators such as experience and authority levels apply to which one of the following operational risk classes?

D. People

Hank has determined the expected number of workers compensations claims in a given year. Hank next calculates the standard deviation of potential outcomes. Calculating the standard deviation

D. Provides a measure of how sure Hank can be in his estimate of claims.

When assessing strategic risk, which one of the following represents the amount of risk an organization is willing to take on in order to achieve an anticipated result or return?

D. Risk appetite

Which one of the following statements is correct with respect to risk tolerance?

D. Risk tolerance levels can have high-end thresholds, low-end thresholds, or both.

Local Petroleum Distributors (LPD) sells gas and diesel fuel to 72 independent gas stations and convenience stores. Receiving accurate data on the fuel needs of its customers is a critical operational concern. LPD installed sensors in the fuel storage tanks owned by each customer. At 11 PM each evening, the sensors send fuel data electronically to LPD. LPD receives the data, and a computer enters each record. The data are analyzed, and the analysis determines which retailers require a fuel shipment in the next three days. The electronic system has increased operational efficiency as shipments can be better coordinated, and retailers are no longer required to measure the fuel level and report manually. LPD's use of a computer to enter the data reported by the sensors is an example of

D. Robotic process automation.

Which one of the following is one of the five steps of the risk management process?

D. Scan environment

Which one of the following commonly used categories of operational risk includes risks associated with technology and equipment?

D. Systems

A data analysis technique that an insurer would likely use to analyze claims adjusters' notes is

D. Text mining.

After a month in which three employees were seriously injured at company paper mills, Ashley, the risk manager of Bright White Paper Company, wanted some answers about the causes of employee injuries. Ashley independently contacted the plant manager and foreman at each of the company's plants. She asked each person to complete a confidential questionnaire regarding safety procedures. After receiving the responses to the questionnaire, Ashley summarized the results and asked the same questions again instructing each person to consider revising their responses based on the initial questionnaire results. The analysis revealed that new workers were not being properly trained and that a lax attitude toward safety was present at the majority of the plants. The team approach to risk identification Ashley employed is called

D. The Delphi technique.

Which one of the following statements is true with regard to linear regression analysis?

D. The regression line represents the "best fit" of a straight or smoothly curved line to actual historical data from prior periods.

According to the Law of Large Numbers, as the number of exposure units insured increases,

D. The relative accuracy of predictions about future losses increases.

George has received an inheritance and is deciding what to do with the money. He has limited his options to four choices: donate all the money to his favorite charity, use the entire inheritance to buy a yacht, invest the inheritance in a small rental property, or use the entire amount to purchase T-bills. Which one of the following statements is true regarding the risk involved in George's options?

D. The rental property presents both pure and speculative risk; property values may increase, and the building could burn down.

An analysis that identifies mathematical patterns in past losses and then projects these patterns into the future is

D. Trend analysis.

Data analytics is especially useful for

D. Unstructured data.

Tania works in the fraud unit for Greatview Insurance. There is a claimant who appears to be involved in multiple cases of insurance fraud. Tania decides to use social media to obtain information that may be used to develop a profile of the claimant. Tania's use of social media is an example of which one of the following types of data?

D. Unstructured external

Widget Manufacturing board of directors recently adopted a zero-risk tolerance for work place accidents. Initially the chief risk officer thought this was a great idea, however, he has found it very hard to implement. One reason that a zero-risk tolerance policy is hard to implement is because zero-risk tolerance

D. Will typically result in risk-based decisions that are too rigid and counter-productive.

Motley Manufacturing is considering locating one of its facilities in northern California, but is concerned about the possibility of loss due to which one of the following natural hazards, which has one of the highest loss exposures for this phenomenon in this part of the country?

Earthquake

Data Entry Company (DEC) offers customers data entry services. A customer can hire DEC to enter survey data to be analyzed. Many DEC employees spend long hours entering data on a computer. DEC has experienced neck strain and wrist pain complaints from their employees, increasing the company's workers' compensation costs. DEC investigated the complaints of its data-entry employees. DEC adopted curved keyboards for data entry, wrist-rests for those entering data, and uniform chair heights and display monitor heights to reduce neck strain claims. The science of designing workspaces based on the health concerns of those who will operate in the workspace is called

Ergonomics

Which one of the following provides a measure of the maximum potential damage associated with an occurrence?

Exposure

The difference between risk tech and insurtech is

Risk tech goes beyond insurtech by expanding its focus to making risk financing more efficient and preventing and mitigating losses in a variety of industries.

Many auto manufacturers have automated a portion of their assembly lines by introducing a smart product. The smart product performs repetitive tasks, such as making the same weld on each vehicle frame as it passes the smart product. These smart products, which can be fixed or mobile, reduce repetitive motion injuries that humans might suffer. They can also be used to perform dangerous tasks and in heavy-lifting jobs. These smart products are called

Robots

An organization implements a new procedure that requires employees who travel to take different flights rather than traveling together. This is an example of which one of the following risk control techniques for this human resource risk?

Separation

Which one of the following is a tool that can be used by fraud investigators to compare documents and analyze notes?

Text mining

Precision Electronic Components manufactures circuit boards, microchips, and other electronic products. Given the precision necessary for their products, the manufacturing environment must be controlled. Temperature, humidity, static electricity and other factors must be monitored. After losing several batches of products due to human monitoring failures and imprecise adjustments, the company moved to a system of sensors. The sensors monitor and regulate temperature, humidity, static electricity, and other factors. The sensors transmit data to and from each other, and the manufacturing environment is continuously adjusted to assure production is successful. The network of sensors transmitting data and the autonomous corrective actions without human interaction is called

The Internet of Things.

Which one of the following statements is true regarding the evolution of risk and risk management?

The definition of risk has evolved to include positive as well as negative attributes

Which one of the following is a characteristic that differentiates big data from traditional data?

Velocity

Mutual Fund Company (MFC) offers a wide array of mutual fund options to investors. Each mutual fund has a different fund objective and set of investment guidelines that apply to the fund. While MFC gives considerable freedom to its fund portfolio managers, they are required to abide by the fund's investment guidelines. To monitor compliance, MFC developed a computer algorithm. The computer algorithm continuously monitors each fund's compliance with investment guidelines. If a fund manager violates the investment guidelines, the computer immediately notifies MFC's internal control director, and corrective action is taken. MFC's use of the computer algorithm to monitor investment compliance and to provide notification when corrective action is necessary illustrates the use of

a. Artificial intelligence.

Which one of the following statements about the use of drones is true?

a. Drones may be equipped with cameras that relay data in real-time.