NES Risk Assessment & Management 2 — Questions and Answers
Question 1: A risk matrix is primarily used to:
- Eliminate all identified risks
- Prioritize risks by likelihood and impact (Correct answer)
- Assign financial costs to each risk
- Document mitigation actions taken
Correct answer: Prioritize risks by likelihood and impact
A risk matrix plots risks by their probability and potential impact to help prioritize which risks require immediate attention.
Question 2: Which risk response strategy involves transferring the financial consequences of a risk to a third party?
- Risk avoidance
- Risk acceptance
- Risk mitigation
- Risk transfer (Correct answer)
Correct answer: Risk transfer
Risk transfer shifts the financial burden of a risk to another party, such as through insurance or contractual agreements.
Question 3: A school identifies that a new construction project next door increases noise levels during standardized testing. This is best classified as:
- A strategic risk
- An environmental risk (Correct answer)
- A reputational risk
- A financial risk
Correct answer: An environmental risk
Environmental risks arise from external physical conditions such as noise, weather, or construction that affect operations.
Question 4: In risk management, 'residual risk' refers to:
- Risk identified after a loss event occurs
- Risk remaining after controls are applied (Correct answer)
- The total unmitigated risk exposure
- Risk that cannot be transferred
Correct answer: Risk remaining after controls are applied
Residual risk is the level of risk that remains after mitigation controls and safeguards have been implemented.
Question 5: Which step in the risk management process involves gathering data and estimating the probability and severity of potential events?
- Risk identification
- Risk analysis (Correct answer)
- Risk monitoring
- Risk communication
Correct answer: Risk analysis
Risk analysis quantifies or qualifies risks by evaluating their likelihood and potential impact after identification.
Question 6: A school administrator decides to cancel an outdoor field trip after reviewing a severe weather forecast. This action best represents:
- Risk transfer
- Risk acceptance
- Risk avoidance (Correct answer)
- Risk mitigation
Correct answer: Risk avoidance
Risk avoidance eliminates the activity or condition that creates the risk, in this case canceling the trip to avoid weather-related hazards.
Question 7: Which tool is most commonly used to systematically identify potential risks across multiple categories in educational settings?
- Fishbone diagram
- Risk register (Correct answer)
- Gantt chart
- SWOT analysis
Correct answer: Risk register
A risk register is a structured document used to record, track, and manage all identified risks and their response plans.
NES Risk Assessment & Management 2
A risk matrix is primarily used to: