ARM 402 CHAPTER 1 (PART 3) COMPREHENSIVE
QUESTIONS AND VERIFIED ANSWERS GRADE A+
GET IT RIGHT 2024 UPDATE
Typically, treating and controlling risk involves one or a combination of
these techniques: - (correct answer) Avoidance, modification,
transfer, retention, or exploitation.
Treating and controlling opportunity risks involves: - (correct answer)
Exploitation.
Selection of the best techniques may depend on whether the risk is: -
(correct answer) A hazard, an operational, a financial, or a strategic
risk.
Risk management professionals will likely treat risks differently
depending on which quadrants they fall into.
Once a risk has been identified and analyzed: - (correct answer) A risk
treatment technique must be selected and applied to the risk.
This aspect can determine which treatment is best: - (correct answer)
The risk quadrants that the risk falls into.
So risk management professionals need to be prepared to apply: -
(correct answer) Various treatments.
, Duplication is a risk retention and modification technique where: -
(correct answer) Exposure units are duplicated to create backups,
spares, or copies of critical property, information, or capabilities.
For a toy that's a choking hazard, the manufacturer could Avoid the risk.
This involves: - (correct answer) Deciding not to produce the toy.
Avoiding the risk would likely be selected if: - (correct answer) The
potential cost of the products liability claims and the negative impact
the claims would have on the company's reputation would outweigh the
revenue generated from the sale of the toy.
However, this option eliminates: - (correct answer) The opportunity
to increase sales using the toy.
The manufacturer could modify the risk: - (correct answer) By
redesigning the toy to contain fewer small parts, the manufacturer
would lower the likelihood that a child will choke on them.
This is an example of: - (correct answer) Loss prevention.
Loss reduction, on the other hand, wouldn't apply in this scenario
because: - (correct answer) The manufacturer is unlikely to reduce
the severity of a choking hazard.
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