CAM Risk Assessment & Mitigation 3

Question 1

A global client informs their account manager that political instability in a key operating country may disrupt their supply chain. This is an example of:

Accepted Answer

Geopolitical risk

Answer

Geopolitical risk refers to potential disruptions caused by political events, instability, or policy changes in specific regions.

Question 2

Which mitigation technique involves spreading account exposure across multiple industries, geographies, or client segments?

Accepted Answer

Diversification

Answer

Diversification reduces concentration risk by ensuring no single factor—industry, geography, or client—dominates the portfolio.

Question 3

An account manager is asked to accept a new contract clause that limits liability to 10% of annual contract value. What risk consideration is MOST relevant?

Accepted Answer

Whether the cap adequately covers potential losses from service failures

Answer

Liability caps must be evaluated against the potential financial exposure from service failures to ensure the limit is commercially acceptable.

Question 4

In the context of account risk, what is 'churn risk'?

Accepted Answer

The probability that a client will discontinue the relationship or switch to a competitor

Answer

Churn risk measures the likelihood that a client will end their contract or reduce engagement, directly impacting recurring revenue.

Question 5

A client has recently been acquired by a competitor of your company. Which risk response strategy is MOST appropriate?

Accepted Answer

Conduct a strategic risk review and escalate to senior leadership for relationship guidance

Answer

An acquisition by a competitor creates significant relationship and conflict-of-interest risk that requires senior leadership involvement and a strategic reassessment.

(CAM) Certified Account Manager Practice Test

(CAM) Certified Account Manager Practice Test

CAM Risk Assessment & Mitigation 3