Risk Management & Mitigation Flashcards
7 cards from real CAP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Risk Management & Mitigation flashcards as text
A lender's credit-scoring model systematically disadvantages a protected demographic group. Which categories of risk does this primarily create?
Answer: Ethical, regulatory, and reputational risk
Biased model outcomes expose the organization to ethical violations, regulatory penalties, and reputational damage even if accuracy is high.
Which technique helps quantify how sensitive a model's recommendation is to uncertainty in its input assumptions?
Answer: Sensitivity analysis or Monte Carlo simulation
Sensitivity analysis and Monte Carlo simulation vary uncertain inputs to show how much outputs and decisions could change.
What is the primary risk of using a single analyst's undocumented workflow to produce recurring business-critical reports?
Answer: Key-person dependency, making the process unrepeatable if the analyst leaves
Undocumented single-person processes create key-person risk, threatening continuity and reproducibility.
A project team lists 'regulatory approval delayed' as a risk with high impact but very low probability. According to standard risk management, how should this typically be handled?
Answer: Keep it on a watch list and define a contingency response given the high impact
Low-probability, high-impact risks warrant monitoring and a contingency plan rather than removal or project cancellation.
Which action best mitigates the risk of data leakage between training and test sets in a predictive modeling project?
Answer: Strictly separating holdout data before any preprocessing or feature engineering
Partitioning data before preprocessing prevents information from the test set from influencing the model and inflating performance estimates.
An organization requires independent validation of models before production use. This control primarily addresses which risk?
Answer: The risk that undetected model errors or biases reach production decisions
Independent validation provides an objective check that catches errors, bias, or invalid assumptions before deployment.
When communicating project risks to executive sponsors, a CAP professional should prioritize which approach?
Answer: Summarizing top risks with business impact, likelihood, and recommended responses
Executives need a prioritized, business-focused risk summary with clear recommended actions, not exhaustive technical detail.