PRMIA Exam 8020 Topic 8 Question 9 Discussion

Actual exam question for PRMIA's 8020 exam

Question #: 9
Topic #: 8

[All 8020 Questions]

In order for a KRI to be effective it must be:

AQuantitative and Qualitative. Consistent. Efficient & Repeatable.

BQualitative, Consistent Efficient & Repeatable.

CQuantitative, Consistent and Comparable. Efficient & Repeatable

DQuantitative, Repeatable and Efficient.

Show Suggested Answer

Suggested Answer: A

Definition of an Effective Key Risk Indicator (KRI)

A KRI is a metric used to identify, measure, and monitor emerging risks.

To be effective, KRIs must be both quantitative and qualitative, allowing for a comprehensive risk view.

Key Characteristics of Effective KRIs

Quantitative -- Uses numerical data for trend analysis.

Qualitative -- Incorporates expert judgment and scenario-based insights.

Consistent -- Maintains uniform definitions across reporting periods.

Efficient & Repeatable -- Must be easily measured and consistently reported.

Why Other Answers Are Incorrect

Option

Explanation

B . Qualitative, Consistent, Efficient & Repeatable.

Incorrect -- Excludes quantitative aspects, which are essential for KRIs.

C . Quantitative, Consistent, Comparable, Efficient & Repeatable.

Incorrect -- While comparison is useful, qualitative factors are missing, making this answer incomplete.

D . Quantitative, Repeatable and Efficient.

Incorrect -- Lacks qualitative insights and consistency as key factors for KRIs.

PRMIA Reference for Verification

PRMIA Risk Indicator Guidelines

Basel Committee's Principles on Risk Data and KRI

by Danilo at Apr 06, 2025, 04:25 AM

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Erick

2 months ago

You know, a good KRI should be like a Swiss Army knife - versatile and ready for anything. A) covers all the bases, no doubt about it.

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Gilma

1 months ago

I agree, consistency and repeatability are crucial for effective risk monitoring.

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Carin

2 months ago

Definitely, having both quantitative and qualitative aspects is key for a well-rounded KRI.

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Lynda

2 months ago

A) Quantitative and Qualitative. Consistent. Efficient & Repeatable.

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Georgeanna

3 months ago

Hmm, that makes sense too. I see your point.

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Elenora

3 months ago

I disagree, I believe the answer is C. KRI should be quantitative, consistent, and comparable.

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Jaime

3 months ago

Ha! As long as the KRI is 'Quantitative, Repeatable and Efficient', I'm golden. D) is the way to go, no need for all that extra stuff.

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Cory

1 months ago

Kristian: I see your point, but I still think D) is the way to go for simplicity.

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Kristian

1 months ago

User 2: I think C) is better, it includes quantitative and comparable aspects.

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Vanesa

2 months ago

User 1: I agree, D) is the most important for an effective KRI.

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Kiera

3 months ago

C) seems like a solid choice too. Quantitative, consistent, and comparable data is crucial for evaluating a KRI's performance.

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Georgeanna

3 months ago

I think the answer is A, because KRI should be both quantitative and qualitative.

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Soledad

3 months ago

I agree, A) covers all the key points. Consistent, efficient, and repeatable - that's what you need for a KRI to be truly meaningful.

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Rozella

3 months ago

A) sounds like the most comprehensive answer to me. Gotta have those quantitative and qualitative measures to really get a sense of the KRI's effectiveness.

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Renea

2 months ago

D) Repeatable and efficient processes ensure that the KRI can be consistently monitored and improved.

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Raina

2 months ago

C) Quantitative, consistent, and comparable measures definitely help in evaluating the KRI's performance.

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Louis

2 months ago

B) I think consistency is key too, so that the KRI can be effectively monitored over time.

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Dominque

2 months ago

A) I agree, having both quantitative and qualitative measures is crucial for a well-rounded KRI.

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