CA Foundation Business Economics Questions 2023 - Part 32
Fri, 03 Mar 2023
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CRISC—Certified in Risk and Information Systems Control Certification Questions and answer - Part 66
1. What is the PRIMARY objective difference between an internal and an external risk management assessment reviewer?
A) In quality of work
B) In ease of access
C) In profession
D) In independence
2. You work as a Project Manager for www.company.com Inc. You have to measure the probability, impact, and risk exposure. Then, you have to measure how the selected risk response can affect the probability and impact of the selected risk event. Which of the following tools will help you to accomplish the task?
A) Project network diagrams
B) Delphi technique
C) Decision tree analysis
D) Cause-and-effect diagrams
3. Which of the following are external risk factors?Each correct answer represents a complete solution. Choose three.(Select 2answers)
A) Geopolitical situation
B) Complexity of the enterprise
C) Market
D) Competition
4. Which of the following is an acceptable method for handling positive project risk?
A) Exploit
B) Avoid
C) Mitigate
D) Transfer
5. You are the project manager of GFT project. Your project involves the use of electrical motor. It was stated in its specification that if its temperature would increase to 500 degree Fahrenheit the machine will overheat and have to be shut down for 48 hours. If the machine overheats even once it will delay the project's arrival date. So to prevent this you have decided while creating response that if the temperature of the machine reach 450, the machine will be paused for at least an hour so as to normalize its temperature. This temperature of 450 degree is referred to as?
A) Risk identification
B) Risk trigger
C) Risk event
D) Risk response
A) In quality of work
B) In ease of access
C) In profession
D) In independence
2. You work as a Project Manager for www.company.com Inc. You have to measure the probability, impact, and risk exposure. Then, you have to measure how the selected risk response can affect the probability and impact of the selected risk event. Which of the following tools will help you to accomplish the task?
A) Project network diagrams
B) Delphi technique
C) Decision tree analysis
D) Cause-and-effect diagrams
3. Which of the following are external risk factors?Each correct answer represents a complete solution. Choose three.(Select 2answers)
A) Geopolitical situation
B) Complexity of the enterprise
C) Market
D) Competition
4. Which of the following is an acceptable method for handling positive project risk?
A) Exploit
B) Avoid
C) Mitigate
D) Transfer
5. You are the project manager of GFT project. Your project involves the use of electrical motor. It was stated in its specification that if its temperature would increase to 500 degree Fahrenheit the machine will overheat and have to be shut down for 48 hours. If the machine overheats even once it will delay the project's arrival date. So to prevent this you have decided while creating response that if the temperature of the machine reach 450, the machine will be paused for at least an hour so as to normalize its temperature. This temperature of 450 degree is referred to as?
A) Risk identification
B) Risk trigger
C) Risk event
D) Risk response
1. Right Answer: D
Explanation: Independence is the freedom from conflict of interest and undue influence. By the mere fact that the external auditors belong to a different entity, their independence level is higher than that of the reviewer inside the entity for which they are performing a review. Independence is directly linked to objectivity.Incorrect Answers:A, B, C: These all choices vary subjectively.
2. Right Answer: C
Explanation: Decision tree analysis is a risk analysis tool that can help the project manager in determining the best risk response. The tool can be used to measure probability, impact, and risk exposure and how the selected risk response can affect the probability and/or impact of the selected risk event. It helps to form a balanced image of the risks and opportunities connected with each possible course of action. This makes them mostly useful for choosing between different strategies, projects, or investment opportunities particularly when the resources are limited. A decision tree is a decision support tool that uses a tree-like graph or model of decisions and their possible consequences, including chance event outcomes, resource costs, and utility.Incorrect Answers:A: Project network diagrams help the project manager and stakeholders visualize the flow of the project work, but they are not used as a part of risk response planning.B: The Delphi technique can be used in risk identification, but generally is not used in risk response planning. The Delphi technique uses rounds of anonymous surveys to identify risks.D: Cause-and-effect diagrams are useful for identifying root causes and risk identification, but they are not the most effective ones for risk response planning.
3. Right Answer: A,D
Explanation: These three are external risk factors as they lie outside the enterprise's control.Incorrect Answers:B: This includes geographic spread and value chain coverage (for example, in a manufacturing environment). That is why it is internal risk factor.
4. Right Answer: A
Explanation: Exploit is a method for handling positive project risk.Incorrect Answers:B, C, D: These are all responses which is used for negative risks, and not the positive risk.
5. Right Answer: B
Explanation: A risk trigger is a warning sign or condition that a risk event is about to happen. Here the warning temperature is 450 degree Fahrenheit, therefore it is referred as risk trigger.Incorrect Answers:A: Risk identification is the process of the identifying the risks. This process identifies the risk events that could affect the project adversely or would act as opportunity.C: Here risk event is 500 degree temperature, as when machine reaches this temperature it should have to be shut-down for 48 hours, which in turn will laid a great impact on the working of project.D: Risk response here is shutting off of machine when its temperature reaches 450 degree Fahrenheit, so as to prevent the occurring of risk event.
Explanation: Independence is the freedom from conflict of interest and undue influence. By the mere fact that the external auditors belong to a different entity, their independence level is higher than that of the reviewer inside the entity for which they are performing a review. Independence is directly linked to objectivity.Incorrect Answers:A, B, C: These all choices vary subjectively.
2. Right Answer: C
Explanation: Decision tree analysis is a risk analysis tool that can help the project manager in determining the best risk response. The tool can be used to measure probability, impact, and risk exposure and how the selected risk response can affect the probability and/or impact of the selected risk event. It helps to form a balanced image of the risks and opportunities connected with each possible course of action. This makes them mostly useful for choosing between different strategies, projects, or investment opportunities particularly when the resources are limited. A decision tree is a decision support tool that uses a tree-like graph or model of decisions and their possible consequences, including chance event outcomes, resource costs, and utility.Incorrect Answers:A: Project network diagrams help the project manager and stakeholders visualize the flow of the project work, but they are not used as a part of risk response planning.B: The Delphi technique can be used in risk identification, but generally is not used in risk response planning. The Delphi technique uses rounds of anonymous surveys to identify risks.D: Cause-and-effect diagrams are useful for identifying root causes and risk identification, but they are not the most effective ones for risk response planning.
3. Right Answer: A,D
Explanation: These three are external risk factors as they lie outside the enterprise's control.Incorrect Answers:B: This includes geographic spread and value chain coverage (for example, in a manufacturing environment). That is why it is internal risk factor.
4. Right Answer: A
Explanation: Exploit is a method for handling positive project risk.Incorrect Answers:B, C, D: These are all responses which is used for negative risks, and not the positive risk.
5. Right Answer: B
Explanation: A risk trigger is a warning sign or condition that a risk event is about to happen. Here the warning temperature is 450 degree Fahrenheit, therefore it is referred as risk trigger.Incorrect Answers:A: Risk identification is the process of the identifying the risks. This process identifies the risk events that could affect the project adversely or would act as opportunity.C: Here risk event is 500 degree temperature, as when machine reaches this temperature it should have to be shut-down for 48 hours, which in turn will laid a great impact on the working of project.D: Risk response here is shutting off of machine when its temperature reaches 450 degree Fahrenheit, so as to prevent the occurring of risk event.
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