A.R.M. 400 Exam Practice | Questions and Correct Solutions 2025

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 - 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 - 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. - 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 - 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. - 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 - 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 - 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. - 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