1. What is political risk and what are the most significant elements to be considered?
Political risk is any governmental actions that diminish value of the firm operating with the boundary or influence of that government
Most significant elements: Nationalization: Confiscation: Expropriation: Contract repudiation
Currency inconvertibility:
2. Describe in details of your study into one of your countries from your selected website addressing political risk
Libya
Political instability: Since January 2010, there have been varying degrees of political instability and public protests, including demonstrations which have been marked by violence, in Libya. Some political regimes in Libya are threatened or have changed as a result of such unrest. Such unrest, if continues to spread, could result in civil wars, regional conflicts, and regime changes resulting in governments that are hostile to the U.S. One method of offsetting financial risk includes insurance policies to cover in-country staff and particularly contracted personnel. Also, another option to mitigate risk are hard techniques typically revolve around easily identifiable physical security measures such as perimeter fencing, walls, locks etc. Marathon Oil should pay more attention to security and risk management planning.
3. What is intellectual property and list at least 5 categories of intellectual properties. Intellectual property: the ownership rights to one’s intangible innovations and creativity.
List: Brand name, Industrial design, Copyright, Geographical indication, Trade secrets
4. There are several guidelines the OECD suggests firms should adopt for the security of information systems and networks. List and describe 4.
1) Awareness: Participants should be aware of need for security of information system and networks and what they can do to enhance the security.
2) Responsibility: All participants, including policy maker and program designers, are responsible of security of information system and networks
3) Response: participant should act in timely and cooperative manner to prevent, detect, and response to security incident.
4) Ethical standard and conduct: participant should respect the legitimate interest of others.

Retro premium = Standard Premium * Basic + Loss * LCF
Loss 100,000 Retro premium = 1,800,000 * 0.14 + 100,000 * 1.14 = 139,200
Minimum (maximum) premium = Standard Premium * percentage (min or max)
Retro premium has to be between minimum and maximum premium
6. What factors constitute economically feasible premiums competition in the market --- price --- threat of new entrance --- threat of new product or substitutes --- consumer’s bargaining power --- degrees or risk attitudes of consumers.
7. What is the role capital surplus in insurance companies?
Insurance policy is a contingent claim contract that relies on pricing inversion. Therefore, the insurer should provide a margin for unfavorable pricing deviation. The greater an insurer’s capital compared to premium writing and liabilities, the greater the perceived security and the more favorable its reception among informed buyers. Strong capital position is favorable. However, the consumers find it hard to assure about the firms’ capital position. Therefore, harmonization of standard and valuation method in insurance is the most important objective of International Accounting Standard Board.
8. In today’s economy insurance supports cross border Insurance trade. What are 4 of these deimensions? Describe them.
1) Pure cross border insurance trade: exist when the resultant insurance contract is entered in because of solicitation of foreign insurer.
2) Own-initiated cross border insurance trade: exist when the insured initiate insurance contract with foreign insurer.
3) Consumption-abroad cross border insurance trade: exist when the insured enter into the contract with local insurer in the country that the insured temporarily residing or visiting.
4)