ARM 400 Exam Practice Questions And Answers 2024
When communicating a decision up the organization's chain of command, consulting with outside
experts can help a risk management professional do which one of the following?
A. Seek feedback from stakeholders
B. Stay focused on the organization's...
ARM 400 Exam Practice Questions And Answers 2024 When communicating a decision up the organization's chain of command, consulting with outside experts can help a risk management professional d o which one of the following? A. Seek feedback from stakeholders B. Stay focused on the organization's objectives C. Define the organization's risk appetite D. Enhance stakeholders' confidence in the process - Correct Answer -D Which of the following risk management program goals is an essential goal for all public entities? A. Earning stability B. Continuity of operations C. Growth D. Survival - Correct Answer -B The traditional definition of risk management reflects the traditional concept of risk as A. Both positive and negative. B. Negative. C. Uncontrollable. D. Strategic. - Correct Answer -B During the past year, International Toys has undertaken four capital projects. The company has renovated and refurbished one of its aging warehouse buildings. It h as purchased the most recent version of its current order processing computer software. It has added two trucks to its fleet of delivery vehicles. Lastly, it has purchased a new production machine that will allow it to launch a new product line. Which one of the following company projects is the most speculative risk? A. The two new trucks B. The warehouse refurbishment C. The software upgrade D. The new production machine - Correct Answer -D Which one of the following statements is true regarding the basic measures that apply to risk management? A. Consequences measure the degree to which an occurrence could positively or negatively affect an organization. B. Hedging is a risk management strat egy that can reduce the risk of correlation. C. Risk increases as volatility decreases. D. Longer time horizons are generally less risky that shorter ones. - Correct Answer -A Which one of the following provides a measure of the maximum potential damage as sociated with an occurrence? A. Exposure B. Duration C. Underwriting risk D. Maximum probable loss - Correct Answer -A Samuel was recently hired as a risk management professional for Parker Property Management. He has been asked by senior management to rev iew the organization's current insurance policies to make sure that the organization is adequately protected, and also see if there are any opportunities to save on the premiums. Samuel must do which one of the following through internal communication befo re he will be able to complete this task? A. Determine the organization's risk appetite B. Identify all of the risks that the organization faces C. Earn the confidence of the organization's board of directors D. Become familiar with industry regulations - Correct Answer -A Catastrophes such as recent earthquakes and the 2011 tsunami in Japan pointed out a need for many organizations to evaluate and manage their A. Supply -chain risk. B. Derivative risk. C. Compliance risk. D. Political risk. - Correct Answer -A Risk management professionals must collaborate with data analysts during which two steps of the risk management process? A. Treat risks and monitor risk treatments B. Scan the environment and analyze risks C. Analyze risks and monitor risk treatments D. Identify risks and treat risks - Correct Answer -C Asking a question such as "How do you think this will work out?" can help a speaker do which one of the following? A. Request feedback and determine if the message has been understood B. Gain the suppor t of executives and decision makers C. Build trust among a diverse group of individuals D. Deliver a message that recipients don't want to hear - Correct Answer -A Carla, the risk manager, was asked by senior management to deliver a presentation on cyber r isk at an all employees meeting. Even though she was only allotted 30 minutes for her presentation, Carla felt that cyber risk was a very real risk for the corporation and she wanted employees to leave with some fear of it. She wanted to provide employees with as much technical information as possible, and familiarize them with all of the important jargon. Less than 20 minutes into her presentation, Carla could tell that many of the employees were not paying any attention to her presentation. Which one of t he following steps in the communication process had Carla failed to consider? A. Pay attention to your body language B. Ask for feedback C. Analyze your audience D. Set a clear communication objective - Correct Answer -C Before speaking with a group or ind ividual, the speaker should think about what he or she wants the other person(s) to do as a result of the conversation. Which one of the following steps in the communication process does the speaker complete by doing this? A. Deliver a message the recipien t(s) want to hear B. Set aside judgement C. Set a clear communication objective D. Analyze your audience - Correct Answer -C Which one of the following risk management objectives is critical for a manufacturer seeking new capital from investors, stockholde rs, and creditors? A. Anticipate and recognize emerging risks B. Social responsibility C. Reduce the deterrent effects of hazard risks D. Eliminate downside risk - Correct Answer -C Which one of the following data capture tools has led to an explosion of risk management innovation by allowing smart products to transmit data to each other and to central hubs? A. Blockchain B. Cloud computing C. Internet of Things D. Artificial intellig ence - Correct Answer -C Jean is the Risk Manager for a Fortune 1000 company. Her CFO has tasked her to analyze vulnerabilities in the firm's supply chain. The adequacy of suppliers to meet an organization's needs would be an example of which one of the fo llowing types of risk? A. Financial risk B. Strategic risk C. Operating risk D. Operational risk - Correct Answer -D An organization must meet the standard of care that it owes to others in order to ensure that A. Legal obligations are satisfied. B. Post -loss goals are in place. C. Operations are efficient. D. Contracts are not breached. - Correct Answer -A
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