Risk Management & Mitigation Flashcards

A general manager wants a quick way to rank 40 identified risks for executive review. Which tool is most appropriate?

Answer: Probability-impact matrix

A probability-impact matrix ranks risks by likelihood and consequence so priorities are visible at a glance.

Which technique gathers anonymous expert opinions over several rounds to identify risks and reach consensus?

Answer: Delphi technique

The Delphi technique uses iterative anonymous questionnaires to converge on expert consensus and reduce bias.

What is residual risk?

Answer: Risk that remains after controls and responses are applied

Residual risk is the exposure left over after mitigation measures are in place.

Which analysis assigns numeric values to risks, such as expected monetary value, rather than relying on descriptive ratings?

Answer: Quantitative risk analysis

Quantitative analysis uses numerical estimates like probability times dollar impact to measure exposure.

A risk has a 20% probability and a potential loss of $250,000. What is its expected monetary value?

Answer: $50,000

EMV equals 0.20 multiplied by $250,000, which is $50,000.

Which statement best distinguishes a risk from an issue?

Answer: A risk is a possible future event; an issue has already occurred

Risks are uncertain future events, while issues are events that have already materialized and need management now.

What is the main purpose of a risk register?

Answer: Document identified risks, owners, ratings and responses in one place

A risk register is the central log of risks with their assessments, owners and planned responses.