ARM 402 CHAPTER 1 (PART 4) 2024
COMPREHENSIVE QUESTIONS AND VERIFIED
ANSWERS GRADE A+ GET IT RIGHT
Holistic risk treatment requires this type of thinking: - (correct answer)
Big-picture thinking.
Holistic risk treatment is an approach to treating all of a company's risks
and opportunities in a way that: - (correct answer) Uses available
resources as efficiently as possible to maximize outcomes.
Risk management processes that don't use a holistic approach tend to
treat individual risks in isolation—often referred to as: - (correct
answer) Siloing risks.
The holistic risk treatment approach is much broader in scope. It
examines: - (correct answer) All risk treatments that could be applied
not only to a single risk, but also multiple risks faced by various
departments.
As important as it is to identify and analyze risks holistically, it's equally
important to: - (correct answer) Treat them holistically.
When a company ensures that its risks are not treated in silos, and that
all possible treatments for the risks it faces are weighed against each
other, the company can select risk treatments that: - (correct answer)
Best utilize resources to achieve strategic goals.
, Holistic risk treatment also considers treatments that could be applied: -
(correct answer) Across all four quadrants of risk: hazard, operational,
financial, and strategic.
The goal is to create: - (correct answer) An all-encompassing view of
the possible risks, treatments, and outcomes a company may face.
Sometimes, a risk management professional might face resistance from
department heads and decision makers when it comes to: - (correct
answer) Sharing information.
Well-practiced communication skills, however, can help convince
reluctant parties of the value of sharing information to: - (correct
answer) Inform and improve risk management strategies.
Some larger companies formalize and centralize the information-sharing
process to encourage this holistic approach, but: - (correct answer)
There will always be an occasional decision maker who remains
reluctant.
Knowing how one risk treatment can affect another can be particularly
valuable to decision makers. The interconnectedness and interactions
between risks and their treatments can significantly affect a company's
outcomes. When all risks and potential treatments are viewed together,
management can make better decisions about: - (correct answer)
Which treatments will best help the company achieve its strategic goals.
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