Risk Assessment & Mitigation Flashcards
7 cards from real COM 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 Assessment & Mitigation flashcards as text
A risk matrix plots likelihood against which other dimension?
Answer: Impact severity
A risk matrix uses two axes — likelihood (probability) and impact severity — to prioritize risks visually.
Which risk response strategy involves purchasing insurance or outsourcing a risky activity?
Answer: Risk transfer
Risk transfer shifts the financial or operational burden of a risk to a third party, such as through insurance or contracts.
In a Failure Mode and Effects Analysis (FMEA), the Risk Priority Number (RPN) is calculated as:
Answer: Severity × Occurrence × Detection
RPN = Severity × Occurrence × Detection, giving a numerical score to prioritize failure modes for corrective action.
What is the primary purpose of a risk register in operations management?
Answer: To document identified risks, their likelihood, impact, and response plans
A risk register is a living document that captures identified risks along with their probability, impact, owners, and mitigation strategies.
Which approach to risk quantification uses probability distributions and repeated simulations to model uncertainty?
Answer: Monte Carlo simulation
Monte Carlo simulation runs thousands of scenarios with random variable inputs to generate a probability distribution of outcomes.
A company discovers that a single supplier provides 80% of a critical component. This represents which type of risk?
Answer: Concentration risk
Concentration risk arises when excessive dependence on a single source, customer, or supplier creates vulnerability to disruption.
When a risk is deemed too minor to address actively, the chosen response strategy is:
Answer: Risk acceptance
Risk acceptance means acknowledging a risk and choosing not to take proactive action, often used when the cost of mitigation exceeds the expected loss.