Enterprise Risk Management (ERM)programs Differ from Traditional Risk Management Programs

question 43

Multiple Choice

Enterprise risk management (ERM) programs differ from traditional risk management programs in all of the following ways EXCEPT

• A)ERM views risk from a portfolio perspective rather than viewing risks in isolation.
• B)ERM encompasses all exposures to risk rather than property,liability,and personnel-related risks only.
• C)ERM evaluates risks relative to the internal environment only rather than considering both the internal and external environment.
• D)ERM embeds risk management throughout the organization rather than limiting risk management to a few areas of the business.

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Definitions:

Testable Explanation

A hypothesis or theory that can be put to the test, designed to explain phenomena in the natural world.

Hypothesis

An initial hypothesis put forward to explain a phenomenon that serves as a basis for further study and can be verified by experimental and observational means.

Scientific Theory

A well-substantiated explanation of some aspect of the natural world, based on a body of evidence and repeatedly tested hypotheses.

Testable Explanation

A hypothesis that can be supported or refuted through experimentation or observation.