Which of the following characteristics would a risk-adverse person or group demonstrate?

Question

Options

• AReasonable comfort with most uncertainty; accepts risk as a normal feature of projects and
• BRisk taking is a price worth paying for future payoffs, seeks strategies and tactics that have high
• CDiscomfort with uncertainty, low tolerance for ambiguity, and seeks security and resolution when
• DAdaptable and resourceful, and is not afraid to take action, or even thrill seeking.

• A
  3% (1)
• B
  3% (1)
• C
  89% (32)
• D
  6% (2)

Explanation

A risk-averse individual or group prefers certainty and predictability over uncertainty, even if that means accepting a lower expected return or outcome. Key behavioral indicators include discomfort with unknowns, low tolerance for ambiguity, and a strong preference for clear, secure situations. They will take steps to eliminate or reduce uncertainty rather than live with it. Choice A describes a risk-neutral stance - accepting risk as normal. Choice B describes a risk-seeking orientation - embracing high-risk strategies for potential high rewards. Choice D describes a risk-seeking or risk-tolerant personality - adaptable, action-oriented, and thrill-seeking. Only C captures the defining hallmarks of risk aversion.

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