- A
Risk tolerance thresholds
Why wrong: Risk tolerance is the acceptable level of variation around risk appetite, not the appetite itself.
- B
Risk criteria
Why wrong: Risk criteria are used to evaluate risk significance, not the willingness to accept.
- C
Risk appetite
This statement defines the organization's risk appetite for operational and compliance risks.
- D
Risk capacity
Why wrong: Risk capacity is the maximum risk the organization can absorb, not the willingness to accept.
Question 826 of 1,000
CRISC IT Risk Identification Practice Question
This CRISC practice question tests your understanding of it risk identification. Read the scenario carefully and evaluate each option against the stated constraints before committing to an answer. After answering, compare your reasoning against the explanation and wrong-answer breakdown below. Once you have made your selection, read the full explanation to reinforce the concept and understand why each distractor is designed to mislead on exam day.
An organization's board has issued a risk appetite statement indicating that the company is willing to accept a moderate level of operational risk but has zero tolerance for compliance violations. This statement primarily defines which of the following?
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Risk appetite
Risk appetite is the amount of risk the organization is willing to accept in pursuit of its objectives. The board's statement sets the overall appetite for different risk categories.
Key principle: Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
Risk tolerance thresholds
Why it's wrong here
Risk tolerance is the acceptable level of variation around risk appetite, not the appetite itself.
- ✗
Risk criteria
Why it's wrong here
Risk criteria are used to evaluate risk significance, not the willingness to accept.
- ✓
Risk appetite
Why this is correct
This statement defines the organization's risk appetite for operational and compliance risks.
Related concept
Read the scenario before looking for a memorised answer.
- ✗
Risk capacity
Why it's wrong here
Risk capacity is the maximum risk the organization can absorb, not the willingness to accept.
Common exam traps
Common exam trap: answer the scenario, not the keyword
Many certification questions include familiar terms but test a specific constraint. Read the exact wording before choosing an answer that is generally true but wrong for this case.
Detailed technical explanation
How to think about this question
This question should be treated as a scenario, not a definition check. Identify the problem, the constraint and the best action. Then compare each option against those facts.
KKey Concepts to Remember
- Read the scenario before looking for a memorised answer.
- Find the constraint that changes the correct option.
- Eliminate answers that are true in general but not in this case.
- Use explanations to understand the rule behind the answer.
TExam Day Tips
- Underline the problem statement mentally.
- Watch for words such as best, first, most likely and least administrative effort.
- Review why wrong options are wrong, not only why the correct option is correct.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
How this comes up in practice
A practitioner preparing for the CRISC exam encounters this exact type of scenario on the job. The correct answer here is not the most general option — it is the best answer for the specific constraint described. Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option. Real exam questions reward reading the full scenario before eliminating options, because the constraint defines which answer fits.
What to study next
Got this wrong? Here's your next step.
Identify which CRISC exam domain this question belongs to, then review the specific concept being tested. Practise related questions in that domain and focus on understanding why each wrong answer is tempting — not just why the correct answer is right.
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FAQ
Questions learners often ask
What does this CRISC question test?
IT Risk Identification — This question tests IT Risk Identification — Read the scenario before looking for a memorised answer..
What is the correct answer to this question?
The correct answer is: Risk appetite — Risk appetite is the amount of risk the organization is willing to accept in pursuit of its objectives. The board's statement sets the overall appetite for different risk categories.
What should I do if I get this CRISC question wrong?
Identify which CRISC exam domain this question belongs to, then review the specific concept being tested. Practise related questions in that domain and focus on understanding why each wrong answer is tempting — not just why the correct answer is right.
What is the key concept behind this question?
Read the scenario before looking for a memorised answer.
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Last reviewed: Jul 4, 2026
This CRISC practice question is part of Courseiva's free ISACA certification practice question bank. Courseiva provides original exam-style practice questions with explanations, topic-based practice, mock exams, readiness tracking, and study analytics to help learners prepare for the CRISC exam.
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