CRM Enterprise Risk Management Flashcards
6 cards from real CRM practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 CRM Enterprise Risk Management flashcards as text
What does 'risk aggregation' mean in ERM?
Answer: Combining individual risks to understand total organizational risk exposure
Risk aggregation combines individual risk assessments to provide a comprehensive view of an organization's total risk profile.
Which of the following is a quantitative risk assessment technique used in ERM?
Answer: Monte Carlo simulation
Monte Carlo simulation uses statistical modeling to quantify the probability distribution of possible outcomes and risk impacts.
The 'three lines of defense' model in ERM assigns the first line to:
Answer: Operational management
In the three lines of defense model, operational management owns and manages risk as the first line of defense.
What is scenario analysis in the context of ERM?
Answer: Evaluating potential future events and their impact on the organization
Scenario analysis examines plausible future events to understand potential impacts and test organizational resilience.
Which of the following is NOT a standard risk treatment option in ERM?
Answer: Risk amplification
The four standard risk treatment options are avoidance, reduction, transfer, and acceptance — amplification is not a recognized treatment.
In ERM, a 'risk owner' is best described as:
Answer: The individual accountable for managing a specific risk
A risk owner is the person assigned accountability for monitoring and managing a specific identified risk.