A.R.M. 400 Exam Practice
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 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 has 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 tr - 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 strategy 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 associated 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 review
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 before he will be able to complete
this task?
A. Determine the organization's risk appetite
,B. Identify all of - 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 support 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 risk 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 - correct answer ✔C
Before speaking with a group or individual, 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 recipient(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, stockholders, 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 intelligence - correct answer ✔C
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 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 has 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 tr - 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 strategy 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 associated 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 review
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 before he will be able to complete
this task?
A. Determine the organization's risk appetite
,B. Identify all of - 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 support 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 risk 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 - correct answer ✔C
Before speaking with a group or individual, 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 recipient(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, stockholders, 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 intelligence - correct answer ✔C
