Assessment of Skills and Knowledge(ASK) in Fundamental Business Concepts Practice Test

What can be a potential consequence of not shredding important documents?

1. Loss of savings

2. Identity theft

3. Increased spending

4. Higher insurance premiums

The correct answer is: Identity theft

Choosing identity theft as the potential consequence of not shredding important documents is valid because personal information found in unshredded documents can be exploited by malicious individuals. When important documents containing sensitive information such as social security numbers, bank account details, or medical records are not properly destroyed, they can easily fall into the wrong hands. This creates opportunities for thieves to impersonate individuals or gain unauthorized access to their financial accounts, often leading to financial loss and significant hassle for the victim in rectifying the situation. The other options—loss of savings, increased spending, and higher insurance premiums—do not directly correlate with the failure to shred documents. While they may relate to broader financial issues, they do not specifically arise from the risk associated with exposing personal information in non-shredded documents. Therefore, identity theft is the most relevant and immediate consequence tied directly to the failure to secure sensitive information appropriately.