CGM Risk Management & Mitigation 2

Question 1

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

Accepted Answer

Probability-impact matrix

Answer

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

Question 2

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

Accepted Answer

Delphi technique

Answer

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

Question 3

What is residual risk?

Accepted Answer

Risk that remains after controls and responses are applied

Answer

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

Question 4

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

Accepted Answer

Quantitative risk analysis

Answer

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

Question 5

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

Accepted Answer

$50,000

Answer

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

CGM - Certified General Manager Practice Test