CH11 z quiz Project Risk Management Flashcards
Mary and Thomas are project managers for their organization and they’re discussing risk management and the risk responses. Thomas insists that an organization should never accept a project risk and Mary says that sometimes it’s okay. They’ve called on you, a project management expert, to help with this decision. When is it appropriate to accept a project risk?
A. It is never appropriate to accept a project risk.
B. All risks must be mitigated or transferred.
C. It is appropriate to accept a risk if the project team has never completed this type of project work before.
D. It is appropriate if the risk is in balance with the reward.
D. Risks that are in balance with the reward are appropriate for acceptance. Risk acceptance as response planning technique to an identified risk is appropriate when the cost of a mitigation strategy is equal to or greater than the cost of the risk event to the project should the risk event occur. A, B, and C are all incorrect because these solutions are all false responses to risk management.
Mary and Thomas are project managers for their organization and they’re discussing risk management and the risk responses. Thomas insists that an organization should never accept a project risk and Mary says that sometimes it’s okay. They’ve called on you, a project management expert, to help with this decision. When is it appropriate to accept a project risk?
A. It is never appropriate to accept a project risk.
B. All risks must be mitigated or transferred.
C. It is appropriate to accept a risk if the project team has never completed this type of project work before.
D. It is appropriate if the risk is in balance with the reward.
Frances is the project manager of the LKJ Project. Which of the following techniques will she use to create the risk management plan? A. Risk tolerance B. Status meetings C. Planning meetings D. Variance meetings
C. Planning meetings are used to create the risk management plan. The project manager, project team leaders, key stakeholders, and other individuals with the power to make decisions regarding risk management attend the meetings. Choices A, B, and D are incorrect, since these choices do not fully answer the question.
Frances is the project manager of the LKJ Project. Which of the following techniques will she use to create the risk management plan? A. Risk tolerance B. Status meetings C. Planning meetings D. Variance meetings
You are the project manager of the GHK Project. You and the manufacturer have agreed to substitute the type of plastic used in the product to a slightly thicker grade should there be more than 7 percent error in production. The thicker plastic will cost more and require the production to slow down, but the errors should diminish. This is an example of which of the following? A. Threshold B. Tracking C. Budgeting D. JIT manufacturing
A. An error value of 7 percent represents the threshold the project is allowed to operate under. Should the number of errors increase beyond 7 percent, the current plastic will be substituted. B is incorrect, since tracking is the documentation of a process through a system or workflow, or the documentation of events through the process. C, budgeting, is also incorrect. D, JIT manufacturing is a scheduling approach to ordering the materials only when they are needed in order to keep inventory costs down.
You are the project manager of the GHK Project. You and the manufacturer have agreed to substitute the type of plastic used in the product to a slightly thicker grade should there be more than 7 percent error in production. The thicker plastic will cost more and require the production to slow down, but the errors should diminish. This is an example of which of the following? A. Threshold B. Tracking C. Budgeting D. JIT manufacturing
You are a project manager consultant for the Allen T1 Company and you’re helping them create a risk management plan for their project management office. You’re explaining the concept of risk tolerance and how it affects the risk management policies. An organization’s risk tolerance is also known as what? A. The utility function B. Herzberg’s theory of motivation C. Risk acceptance D. The risk-reward ratio
A. The utility function describes an organization’s willingness to tolerate risk. B is incorrect. Herzberg’s Theory of Motivation is a human resources theory that describes motivating agents for workers. C is also incorrect. Risk acceptance describes the action of allowing a risk to exist because it is deemed low in impact, low in probability, or both. D, the risk-reward ratio, is incorrect. This describes the potential reward for taking on a risk in the project.
You are a project manager consultant for the Allen T1 Company and you’re helping them create a risk management plan for their project management office. You’re explaining the concept of risk tolerance and how it affects the risk management policies. An organization’s risk tolerance is also known as what? A. The utility function B. Herzberg’s theory of motivation C. Risk acceptance D. The risk-reward ratio
The customers of the project have requested additions to the project scope. The project manager notifies you that additional risk planning will need to be added to the project schedule. Why?
A. The risk planning should always be the same amount of time as the activities required by the scope change.
B. Risk planning should always occur whenever the scope is adjusted.
C. Risk planning should only occur at the project manager’s discretion.
D. The project manager is incorrect. Risk planning does not need to happen at every change in the project.
B. When the scope has been changed, the project manager should require risk planning to analyze the changes for risks to the project’s success. A is incorrect. The scope changes may not require the same amount of time as the activities needed to complete the risk planning. C is incorrect because risk planning should not occur at the project manager’s discretion. Instead, it should be based on evidence within the project and the policies adopted in the risk management plan. D is also incorrect. When changes are added to the project scope, risk planning should occur.
The customers of the project have requested additions to the project scope. The project manager notifies you that additional risk planning will need to be added to the project schedule. Why?
A. The risk planning should always be the same amount of time as the activities required by the scope change.
B. Risk planning should always occur whenever the scope is adjusted.
C. Risk planning should only occur at the project manager’s discretion.
D. The project manager is incorrect. Risk planning does not need to happen at every change in the project.
Jason is the project manager for his organization and he’s working with his project team to identify and analyze project risks. Jason begins to create a risk register as part of this process, but his team doesn’t understand what a risk register is or its purpose. Which one of the following best describes the risk register?
A. It documents all of the outcomes of the other risk management processes.
B. It’s a document that contains the initial risk identification entries.
C. It’s a system that tracks all negative risks within a project.
D. It’s part of the project’s project management information system (PMIS) for integrated change control.
A. The risk register documents all of the outcomes of the other risk management processes. B, C, and D are all incorrect definitions of the risk register.
Jason is the project manager for his organization and he’s working with his project team to identify and analyze project risks. Jason begins to create a risk register as part of this process, but his team doesn’t understand what a risk register is or its purpose. Which one of the following best describes the risk register?
A. It documents all of the outcomes of the other risk management processes.
B. It’s a document that contains the initial risk identification entries.
C. It’s a system that tracks all negative risks within a project.
D. It’s part of the project’s project management information system (PMIS) for integrated change control.
You are a project management consultant for the Steinberg Organization and you’re helping them categorize risks they may encounter in their projects. For starters you identify some basic risk categories but your client wants to see some examples of these categories. You tell them, for example, that \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ include(s) fire, theft, or injury, and offer(s) no chance for gain. A. Business risks B. Pure risks C. Risk acceptance D. Life risks
B. Pure risks are the risks that could threaten the safety of the individuals on the project. A is incorrect because business risks affect the financial gains or losses of a project. C and D are incorrect, since these terms are not relevant.
You are a project management consultant for the Steinberg Organization and you’re helping them categorize risks they may encounter in their projects. For starters you identify some basic risk categories but your client wants to see some examples of these categories. You tell them, for example, that \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ include(s) fire, theft, or injury, and offer(s) no chance for gain. A. Business risks B. Pure risks C. Risk acceptance D. Life risks
Complete this sentence: A project risk is a(n )\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ occurrence that can affect the project for good or bad. A. Known B. Potential C. Uncertain D. Known unknown
C. Risks are not planned; they are left to chance. The accommodation and the reaction to a risk can be planned, but the event itself is not planned. If risks could be planned, Las Vegas would be out of business. A, B, and D are all incorrect, since these terms do not accurately complete the sentence.
Complete this sentence: A project risk is a(n )\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ occurrence that can affect the project for good or bad. A. Known B. Potential C. Uncertain D. Known unknown
Bradley is the project manager for his organization and he’s working with his project team to identify risks. Some of the project team members are confused as to when risk identification should happen in the project. When should risk identification happen?
A. As early as possible in the initiation process
B. As early as possible in the planning process
C. Throughout the product management life cycle
D. Throughout the project life cycle
D. Risk identification is an iterative process that happens throughout the project’s life cycle. A and B are both incorrect because risk identification is not limited to any one process group. C is incorrect because risk identification happens, technically, throughout the project management life cycle, which is unique to each project, and not through the product management life cycle.
Bradley is the project manager for his organization and he’s working with his project team to identify risks. Some of the project team members are confused as to when risk identification should happen in the project. When should risk identification happen?
A. As early as possible in the initiation process
B. As early as possible in the planning process
C. Throughout the product management life cycle
D. Throughout the project life cycle
You are the project manager of the KLJH Project. This project will last two years and has 30 stakeholders. How often should risk identification take place? A. Once at the beginning of the project B. Throughout the execution processes C. Throughout the project D. Once per project phase
C. Risk identification happens throughout the project. Recall that planning is iterative: as the project moves toward completion, new risks may surface that call for identification and planned responses. A is incorrect. Risk identification should happen throughout the project, not just at the beginning. B is incorrect because risk identification is part of planning. D is incorrect because the nature of the project phase may require and reveal more than one opportunity for risk identification.
You are the project manager of the KLJH Project. This project will last two years and has 30 stakeholders. How often should risk identification take place? A. Once at the beginning of the project B. Throughout the execution processes C. Throughout the project D. Once per project phase
Ruth is a project management expert and consultant for businesses creating project management offices. Ruth’s current client wants help to better identify risks. Which one of the following is an acceptable tool for risk identification? A. Decision tree analysis B. Decomposition of the project scope C. The Delphi Technique D. Pareto charting
C. The Delphi Technique, an anonymous risk identification method, is the correct answer. A is incorrect. Decision tree analysis is appropriate for calculating the expected monetary value of a decision, but not risk identification. B is incorrect because the decomposition of the project scope will result in the WBS. D is incorrect. Creating a Pareto chart is part of quality control, not risk identification.
Ruth is a project management expert and consultant for businesses creating project management offices. Ruth’s current client wants help to better identify risks. Which one of the following is an acceptable tool for risk identification? A. Decision tree analysis B. Decomposition of the project scope C. The Delphi Technique D. Pareto charting
You are the project manager for a project that will create a new and improved web site for your company. Currently, your company has over 8 million users around the globe. You would like to poll experts within your organization with a simple, anonymous form asking about any foreseeable risks in the design, structure, and intent of the web site. With the collected information, subsequent anonymous polls are submitted to the group of experts. This is an example of \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_. A. Risk identification B. A trigger C. An anonymous trigger D. The Delphi Technique
D. An anonymous poll that allows experts to freely submit their opinion without fear of backlash is an example of the Delphi Technique. A, B, and C are incorrect. These choices do not accurately answer the question.
You are the project manager for a project that will create a new and improved web site for your company. Currently, your company has over 8 million users around the globe. You would like to poll experts within your organization with a simple, anonymous form asking about any foreseeable risks in the design, structure, and intent of the web site. With the collected information, subsequent anonymous polls are submitted to the group of experts. This is an example of \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_. A. Risk identification B. A trigger C. An anonymous trigger D. The Delphi Technique
Alice is a project manager for her organization and she’s working with the project team to identify project risks and rank them by impact and probability. Which risk analysis technique provides the project manager with a risk ranking? A. Quantifiable B. Qualitative C. The utility function D. SWOT analysis
B. The risk ranking is based on the very high, high, medium, low, and very low attributes of the identified risks. A is incorrect because it is not relevant to the question. This answer is quantifiable, not quantitative. C is incorrect. “Utility function” describes an organization’s tolerance for risk. D, SWOT analysis, is part of risk identification.
Alice is a project manager for her organization and she’s working with the project team to identify project risks and rank them by impact and probability. Which risk analysis technique provides the project manager with a risk ranking? A. Quantifiable B. Qualitative C. The utility function D. SWOT analysis
A table of risks, their probability, impact, and a number representing the overall risk score is called a \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_. A. Risk table B. Probability and impact matrix C. Quantitative matrix D. Qualitative matrix
B. A table of risks, their probability, and impact equate to a risk score, and is a risk probability and impact matrix. A is incorrect, since it does not fully answer the question. C and D are incorrect because a risk matrix can be used in both quantitative and qualitative risk analyses.
A table of risks, their probability, impact, and a number representing the overall risk score is called a \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_. A. Risk table B. Probability and impact matrix C. Quantitative matrix D. Qualitative matrix
The water sanitation project manager has determined that the risks associated with handling certain chemicals are too high. He has decided to allow someone else to complete this portion of the project, and so has outsourced the handling and installation of the chemicals and filter equipment to an experienced contractor. This is an example of which of the following? A. Avoidance B. Acceptance C. Mitigation D. Transference
D. Because the risk is not eliminated but transferred to someone else or another entity, it is considered transference. A is incorrect because the risk still exists—it is just being handled by another entity. B is incorrect because the project manager has not accepted the risk, deciding instead to allow another entity to deal with it. C is incorrect. The risk has not been mitigated in the project.
The water sanitation project manager has determined that the risks associated with handling certain chemicals are too high. He has decided to allow someone else to complete this portion of the project, and so has outsourced the handling and installation of the chemicals and filter equipment to an experienced contractor. This is an example of which of the following? A. Avoidance B. Acceptance C. Mitigation D. Transference
