CBA Risk Management & Mitigation 2

Question 1

A budget analyst identifies that a key federal grant funding 30% of the agency's operations may not be renewed. Which risk response strategy is MOST appropriate?

Accepted Answer

Develop contingency budget plans and identify alternative funding sources

Answer

Developing contingency plans and alternative funding sources is the appropriate mitigation strategy for a significant funding dependency risk.

Question 2

In risk-adjusted budgeting, an 'expected value' calculation requires multiplying a risk's potential financial impact by its:

Accepted Answer

Probability of occurrence

Answer

Expected value (EV) = probability of occurrence × potential financial impact, allowing analysts to prioritize risks quantitatively.

Question 3

Which tool is MOST commonly used by government budget analysts to visually assess and prioritize multiple risks simultaneously?

Accepted Answer

Risk heat map (probability-impact matrix)

Answer

A risk heat map plots risks by probability and impact, enabling analysts to visually prioritize which risks require immediate mitigation.

Question 4

A federal agency's budget is heavily dependent on a single contractor for IT services. This represents which type of concentration risk?

Accepted Answer

Vendor/supplier concentration risk

Answer

Reliance on a single vendor creates vendor concentration risk, which can disrupt operations and budgets if the contractor fails to deliver.

Question 5

When Congress passes a continuing resolution (CR) instead of a full appropriations bill, what budget risk does this PRIMARILY create?

Accepted Answer

Operational and planning uncertainty risk

Answer

Continuing resolutions typically fund agencies at prior-year levels with restrictions, creating planning uncertainty and potential gaps in new program funding.

(CBA) Certified Budget Analyst Practice Test

(CBA) Certified Budget Analyst Practice Test

CBA Risk Management & Mitigation 2