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Question
An entrepreneur faces financial losses due to a natural disaster that damages their inventory. Which auxiliary to trade could have mitigated this loss?
Options
Transportation
Warehousing
Insurance
Banking
MCQ
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Solution
Insurance
Explanation:
Insurance would have mitigated the financial loss caused by the natural disaster. By taking out an insurance policy, the entrepreneur could have protected their inventory and other assets against unforeseen events such as natural disasters. Insurance provides financial compensation in such cases, helping to recover from the damage. The other options (transportation, warehousing, and banking) do not directly address the loss caused by the disaster.
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