First, consider some basic background information concerning the differences between not-for-profit organizations and investor-owned firms. Which of the three project risk measures--stand-alone, corporate, and market--is relevant to not-for-profit businesses?

Sandra McCloud, a finance major in her last term of college, is currently scheduling her placement interviews through the university's career resource center. Her list of companies is typical of most finance majors: several commercial banks, a few industrial firms, and one brokerage house. However, she noticed that a representative of a not-for-profit hospital is scheduling interviews next week, and the position--that of financial analyst--appears to be exactly what Sandra has in mind. Sandra wants to sign up for an interview, but she is concerned that she knows nothing about not-for-profit organizations and how they differ from the investor-owned firms that she has learned about in her finance classes. In spite of her worries, Sandra scheduled an appointment with the hospital representative, and she now wants to learn more about not-for-profit businesses before the interview.
To begin the learning process, Sandra drew up the following set of questions. See if you can help her answer them.


Corporate risk, or the additional risk a project adds to the overall riskiness of the firm's portfolio of projects, is the most relevant risk for a not-for-profit firm, since most not-for-profit firms offer a wide variety of products and services. Stand-alone risk would only be relevant if the project were the only one the firm would be involved with. Market risk is not relevant at all, since not-for-profit firms do not have stockholders.

Health Professions

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A) Throughout the entire call B) Prior to leaving the ambulance C) After completing the primary assessment D) After receiving dispatch information

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A) Terminally ill and foregoing any additional care until death B) Terminally ill and receiving measures to increase comfort until death C) Terminally ill and but receiving care to reverse the disease process so as to avoid death D) Terminally ill but without a Do Not Resuscitate order

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Answer the following statement true (T) or false (F)

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