what does purchasing insurance for a business reveal about the business owners attitude toward financial…

what does purchasing insurance for a business reveal about the business owners attitude toward financial risk?\nit shows that the owner expects financial risk and is eliminating it by making an insurance company liable.\nit shows that the owner acknowledges the financial risks and is willing to pay every month to transfer the risk to an insurance company.\nit shows that the owner is willing to share ownership of the business to reduce financial risk.\nit shows that the owner is willing to budget for short - term financial risks to avoid long - term risks.

what does purchasing insurance for a business reveal about the business owners attitude toward financial risk?\nit shows that the owner expects financial risk and is eliminating it by making an insurance company liable.\nit shows that the owner acknowledges the financial risks and is willing to pay every month to transfer the risk to an insurance company.\nit shows that the owner is willing to share ownership of the business to reduce financial risk.\nit shows that the owner is willing to budget for short - term financial risks to avoid long - term risks.

Answer

Brief Explanations:

Purchasing business insurance is a risk - transfer strategy. The business owner knows there are financial risks and pays premiums (usually monthly) to an insurance company to take on those risks. It doesn't eliminate risk completely (first option is wrong), doesn't involve sharing ownership (third option is wrong), and isn't mainly about short - term vs long - term budgeting in this context (fourth option is wrong).

Answer:

It shows that the owner acknowledges the financial risks and is willing to pay every month to transfer the risk to an insurance company.