ERM Quiz

What is the definition of enterprise risk?

The potential for loss or harm to a business as a result of internal or external factors

The process of identifying and assessing risks in a business

The strategies implemented to mitigate risks in a business

The financial impact of risks on a business

Which of the following is an example of strategic risk?

Entering a new market with uncertain demand

Equipment failure in a manufacturing plant

Employee theft

Changes in government regulations

What is the purpose of a risk assessment?

To identify and evaluate potential risks in a business

To implement risk management strategies

To calculate the financial impact of risks

To monitor and control risks in real-time

Which of the following is a qualitative risk assessment method?

Risk matrix

Monte Carlo simulation

Expected monetary value analysis

Fault tree analysis

What is the correct sequence of steps in the risk management process?

Identify, assess, mitigate, monitor

Assess, identify, monitor, mitigate

Mitigate, assess, identify, monitor

Monitor, identify, assess, mitigate

Which of the following is a risk transfer strategy?

Purchasing insurance

Implementing control measures

Diversifying business operations

Creating contingency plans

What is the purpose of a business continuity plan?

To ensure the continuation of critical business operations during and after a disruption

To identify potential risks in a business

To calculate the financial impact of risks

To monitor and control risks in real-time

Which of the following is an example of operational risk?

Equipment failure

Changes in market demand

Employee turnover

Cybersecurity breaches

What is the purpose of risk mitigation?

To reduce the likelihood or impact of identified risks

To identify potential risks in a business

To calculate the financial impact of risks

To monitor and control risks in real-time

What is the difference between inherent risk and residual risk?

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