CRA Emerging & Geopolitical Risks 3

Question 1

A company operating in a country with strict capital controls faces difficulty repatriating profits. This is best classified as:

Accepted Answer

Transfer and convertibility risk

Answer

Transfer and convertibility risk arises when a government restricts or blocks the movement of funds across borders, preventing companies from repatriating earnings or repaying cross-border obligations.

Question 2

Which of the following geopolitical developments would most directly create commodity price risk for energy-importing nations?

Accepted Answer

Military conflict in a major oil-producing region

Answer

Military conflict in major oil-producing regions disrupts supply, directly causing oil price spikes that create significant energy cost risk for importing nations.

Question 3

The concept of 'friend-shoring' in supply chain risk management involves:

Accepted Answer

Concentrating supply chains among geopolitically aligned partner nations

Answer

Friend-shoring is a strategy of concentrating trade and supply chain relationships among politically allied countries to reduce exposure to adversarial geopolitical relationships.

Question 4

A Certified Risk Analyst evaluating emerging market debt should consider 'debt distress' indicators, which include all of the following EXCEPT:

Accepted Answer

A positive current account surplus with strong reserve coverage

Answer

A positive current account surplus and strong reserve coverage are signs of financial resilience, not distress indicators—the other options are classic warning signs of emerging market debt vulnerability.

Question 5

Which organization publishes the annual Global Risks Report that is widely used as a reference for emerging risk identification?

Accepted Answer

World Economic Forum (WEF)

Answer

The World Economic Forum publishes the annual Global Risks Report, which surveys global leaders to identify and rank the most critical emerging risks across economic, environmental, geopolitical, societal, and technological categories.

(CRA) Certified Risk Analyst Practice Test

(CRA) Certified Risk Analyst Practice Test

CRA Emerging & Geopolitical Risks 3