Sean recently started a small consulting practice. He is the only employee and sole revenue generator. He worries that if he becomes disabled, there will be no revenue. Which goal best identifies Sean's concerns?

Sean recently started a small consulting practice. He is the only employee and sole revenue generator. He worries that if he becomes disabled, there will be no revenue. Which goal best identifies Sean's concerns?

• A. Social responsibility and earnings stability
• B. Legality and profitability
• C. Tolerable uncertainty and earnings stability
• D. Economy of risk management operations

Answer: (C)

This question is about the risk-management goal of controlling uncertainty about future earnings and keeping income steady. Sean’s worry is that if he becomes disabled, there will be no revenue because he is the only person generating it. The best choice targets both pieces: minimize the level of uncertain income that is tolerable and ensure earnings stay stable even if he cannot work. In practice, this means planning to sustain earnings despite disability, using tools like disability income protection or other safeguards to keep cash flow predictable. The other options miss the focus on personal income risk. Social responsibilities and earnings stability mix in a broader purpose not specific to protecting his solo revenue; legality and profitability centers on compliance and profit, not the risk to individual earnings; economy of risk management operations emphasizes cost efficiency of the risk program rather than the outcome of earnings stability.

This question is about the risk-management goal of controlling uncertainty about future earnings and keeping income steady. Sean’s worry is that if he becomes disabled, there will be no revenue because he is the only person generating it. The best choice targets both pieces: minimize the level of uncertain income that is tolerable and ensure earnings stay stable even if he cannot work. In practice, this means planning to sustain earnings despite disability, using tools like disability income protection or other safeguards to keep cash flow predictable.

The other options miss the focus on personal income risk. Social responsibilities and earnings stability mix in a broader purpose not specific to protecting his solo revenue; legality and profitability centers on compliance and profit, not the risk to individual earnings; economy of risk management operations emphasizes cost efficiency of the risk program rather than the outcome of earnings stability.