The three ways to manage risk are:

• A. Gain or Loss Risks, Insurable Risks, and Controllable Risks
• B. Financial Loss, Personal Injury, and Poverty Loss
• C. Risk Transfer, Risk Retention, and Risk Avoidance
• D. Fire, Theft, and Floods

Answer: (C)

In risk management for sports and entertainment, you handle uncertainty by choosing actions that change who bears the potential loss. The three ways to manage risk are transferring the risk to another party, retaining the risk yourself, or avoiding the risk altogether. Transfer means shifting the potential loss to someone else, typically through insurance or contractual indemnities—so if a stadium contingency or weather-related cancellation occurs, you’re protected by a policy or contract. Retention involves accepting and budgeting for losses that may occur, often through setting aside a reserve fund or self-insurance for smaller risks. Avoidance is about not taking on the risk in the first place, such as canceling or not scheduling an event in a venue with unmanageable safety concerns.

The other options describe types of risk or the hazards that can occur, not the actions used to manage them, so they don’t outline how risk is actually handled.