CRA Risk Identification & Assessment Techniques 2 — Questions and Answers
Question 1: Which risk identification technique relies on expert judgment and structured rounds of anonymous questionnaires to build consensus?
- Delphi Technique (Correct answer)
- SWOT Analysis
- Root Cause Analysis
- Monte Carlo Simulation
Correct answer: Delphi Technique
The Delphi Technique uses iterative rounds of anonymous expert questionnaires to reach consensus on risk identification without groupthink bias.
Question 2: A risk analyst discovers that a single supplier provides 80% of critical components. Which type of risk concentration is this an example of?
- Liquidity risk
- Concentration risk (Correct answer)
- Systemic risk
- Reputational risk
Correct answer: Concentration risk
Concentration risk arises when a large proportion of exposure is tied to a single entity, sector, or source, amplifying potential losses.
Question 3: In a risk heat map, a risk plotted in the upper-right quadrant indicates it is:
- Low likelihood and high impact
- High likelihood and low impact
- High likelihood and high impact (Correct answer)
- Low likelihood and low impact
Correct answer: High likelihood and high impact
The upper-right quadrant of a heat map represents risks with both high likelihood and high impact, requiring immediate attention and mitigation.
Question 4: Which assessment approach assigns numerical probabilities and financial values to risk outcomes to derive an expected loss?
- Qualitative risk assessment
- Quantitative risk assessment (Correct answer)
- Residual risk assessment
- Inherent risk assessment
Correct answer: Quantitative risk assessment
Quantitative risk assessment uses numeric data, probability distributions, and financial modeling to calculate expected losses and value-at-risk metrics.
Question 5: The term 'inherent risk' refers to the level of risk that exists:
- After all controls are applied
- Before any controls or mitigations are applied (Correct answer)
- Only in high-impact scenarios
- Following a residual risk review
Correct answer: Before any controls or mitigations are applied
Inherent risk is the raw level of risk exposure that exists before any controls, mitigations, or risk responses are implemented.
Question 6: During a facilitated risk workshop, participants generate risks by asking 'What could go wrong if this assumption is false?' This technique is known as:
- Assumption analysis (Correct answer)
- Checklist analysis
- PESTLE analysis
- Bow-tie analysis
Correct answer: Assumption analysis
Assumption analysis systematically challenges project or process assumptions to surface risks that arise if those assumptions prove incorrect.
Question 7: Which qualitative scale best represents ordinal risk ratings used in risk assessment matrices?
- 1.0, 1.5, 2.0, 2.5
- Very Low, Low, Medium, High, Very High (Correct answer)
- 0%, 25%, 50%, 75%, 100%
- $0, $1K, $10K, $100K
Correct answer: Very Low, Low, Medium, High, Very High
Ordinal scales like Very Low through Very High represent ranked categories without implying equal intervals, which is standard in qualitative risk matrices.
CRA Risk Identification & Assessment Techniques 2
Which risk identification technique relies on expert judgment and structured rounds of anonymous questionnaires to build consensus?