Risk Management Quiz

What is the primary goal of risk management?

• To eliminate all risks

• To identify, assess, and minimize risks

• To transfer risks to others

• To avoid decision-making

Which of the following best describes a “risk”?

• An event that is guaranteed to happen

• An uncertain event that can impact objectives

• A problem that has already occurred

• A financial transaction

Which step comes first in the risk management process?

• Risk treatment

• Risk monitoring

• Risk identification

• Risk evaluation

What does a risk assessment primarily involve?

• Prioritizing risks based on probability and impact

• Writing policies

• Conducting financial audits

• Hiring consultants

The formula for risk is often expressed as:

• Risk = Likelihood × Impact

• Risk = Cost ÷ Benefit

• Risk = Assets − Liabilities

• Risk = Threat + Opportunity

Which of the following is an example of risk avoidance?

• Buying insurance

• Outsourcing risky activities

• Not engaging in a risky project at all

• Implementing controls

What is “risk mitigation”?

• Accepting the consequences of risk

• Reducing the likelihood or impact of risk

• Transferring risk to another party

• Ignoring risk factors

Which document usually records identified risks, their analysis, and mitigation plans?

• Audit report

• Risk register

• Annual report

• Financial statement

Which type of risk relates to laws, regulations, and compliance?

• Operational risk

• Strategic risk

• Legal/regulatory risk

• Financial risk

Which of the following is an example of financial risk?

• Market volatility

• Equipment breakdown

• Employee turnover

• Cyberattack