Manage Risks

Question 1

You have been hired to manage a large project. During risk response planning, the team decided to postpone the solution design, hoping that a more cost-effective technology becomes available within the next two months. Which risk response strategy did the team adopt?

A. Exploit
B. Enhance
C. Contingent response
D. Mitigate

Answer 1

B. Enhance

The team took proactive measures to increase the probability and impact of the opportunity.

Question 2

Serious errors were found in the product during a test cycle in a software development project. Management is worried because the project Cost Performance Index is 0.8 and the Schedule Performance Index is 0.75. Additionally, the project is struggling with a lack of resources. Which of the following is the MOST likely cause?

A. Poor scope definition
B. Inadequate quality management planning
C. Lack of a resource management plan
D. Unidentified risks

Answer 2

D. Unidentified risks

The project is facing problems across the schedule, costs, quality, and resource
management areas. Only poor risk management would explain why the project
is facing generalized performance problems. All other options are unable to
fully explain the project performance issues.

Question 3

You have been asked to take over a troubled project. The project has a CPI of 0.7 and a SPI of 0.68. The product is plagued by errors and there is an history of constant scope changes and unstable resource allocation. What is the most likely cause of the project situation?

A. The scope statement was not defined with the relevant stakeholders
B. Poor risk management
C. The staffing management plan was not approved by functional managers
D. Team members did not participate in the estimating effort

Answer 3

B. Poor risk management

Widespread project issues are usually the result of inadequate or insufficient
risk management. The project is facing cost, schedule, quality, scope and
human resources issues. Therefore, poor risk management is the best answer.

Question 4

You met with key stakeholders and subject matter experts and collected a large set of project risks. You now need to find the underlying causes which may lead to each risk event. Which of the following options can help you to improve the risk response effectiveness by identifying the risks causes?

A. Force-field diagram
B. Fishbone diagram
C. Pareto chart
D. Triggers

Answer 4

B. Fishbone diagram

A fishbone diagram is used to identify the risk causes.

Question 5

After completing risk response planning, residual risks remain active. These risks should be managed through the _____________ process.

A. Identify risks
B. Workaround
C. Monitor risks
D. Plan risk responses

Answer 5

C. Monitor risks

Accepted risks should be managed through the monitor risks process.

Question 6

A risk with a significant impact occurred. The risk was not previously identified so there is no risk response available. What should the project manager do FIRST?

A. Assess the risk probability and impact
B. Accept the risk
C. Implement a contingency plan
D. Establish a workaround

Answer 6

D. Establish a workaround

When the risk occurs and there is no planned response, the first priority should
not be to reevaluate the risk (answer A). The priority cannot be to implement a
contingency plan (answer C), because the risk has not been identified yet.
Accepting the risk (answer B) is not an option because the risk has already
occurred. The project manager’s main priority should be to solve the problem
through a workaround.

Question 7

You have been hired by a consulting company to manage a large process improvement project. After identifying and assessing risks, you are now in the middle of risk response planning. Which of the following are valid strategies for responding to opportunities? (Choose three.)

A. Exploit
B. Share
C. Transfer
D. Ensure
E. Escalate
F. Improve

Answer 7

A. Exploit
B. Share
E. Escalate

Exploit, share and escalate are valid opportunity response stategies.

Question 8

Fearing airline strikes, your company has decided to cancel all onsite meetings scheduled for the month of April. Web meetings have been scheduled instead. What type of risk response strategy has been used?

A. Accept
B. Mitigate
C. Transfer
D. Avoid

Answer 8

D. Avoid

The risk was avoided, because web meetings cannont be impacted by a potential airline strike.

Question 9

You are managing a critical and complex off-shore Oil exploration project. A friend of yours recommended the adoption of risk thresholds. What is risk threshold?

A. Represent a boundary that signal that additional risk responses are required
B. A risk attitude where stakeholders are willing to accept high risk in exchange for high rewards
C. Definition of risk probability
D. A classification of the willingness to accept risks, in exchange of potential rewards

Answer 9

A. Represent a boundary that signal that additional risk responses are required

Risk thresholds establish a limit of how much risk stakeholders are willing to
take and Signal that additional responses are required.

Question 10

A risk of high impact was identified during the project. What should you do FIRST?

A. Inform management about the risk
B. Evaluate the risk
C. Implement a workaround
D. Submit a change request

Answer 10

B. Evaluate the risk

An identified risk, that has not yet occured, should be analyzed.

Question 11

You are managing a critical project that will redesign your company’s website. You want to ensure that the project risks are managed effectively. Which of the following are valid reasons to use risk management? (Choose three.)

A. Minimize project threats
B. Address expectations because senior management is always risk averse
C. Ensure that every issue is proactively addressed
D. Avoid chaos by implementing contingency plans if the risks do occur
E. Ensure that the project meets objectives
F. Protect project value

Answer 11

A. Minimize project threats
D. Avoid chaos by implementing contingency plans if the risks do occur
F. Protect project value

Senior management is not necessarily risk averse (answer B). It is not possible
to ensure that every issue is proactively addressed (answer C). It is not possible
to ensure that the project meets objectives (answer E). The remaining
statements are valid reasons to use risk management.

Question 12

If there is 60% chance the procured servers are late with a consequent cost overrun of 1000. What is the expected monetary value of the risk?

A. 1000 loss
B. 600 loss
C. 400 loss
D. 400 savings

Answer 12

B. 600 loss

The risk expected monetary value is 60%x1000=600.

Question 13

A project stakeholder consistently makes decisions to avoid high risk exposure. The stakeholder is known as:

A. Risk seeker
B. Avoiding risks
C. Risk averse
D. Managing risks

Answer 13

C. Risk averse

The stakeholder demonstrated evidences of being risk averse, i.e., his level of
satisfaction decreases with an increase of risk exposure.

Question 14

A multi-year urban renewal project has been divided into three mid-size projects to manage solution complexity. Which risk response strategy has the team adopted?

A. Avoid
B. Transfer
C. Mitigate
D. Decompose

Answer 14

C. Mitigate

Risk mitigation refers to proactive measures to decrease the probability and/or
impact of the threat to an acceptable level (e.g., dividing a project into mid-size
projects to manage solution complexity).

Question 15

You need to make a decision considering the probabilities and impacts of two alternative approaches. Which tool or technique should you use?

A. Decision tree analysis
B. Probability and impact scale
C. Probability and impact matrix
D. Expected monetaryvalue

Answer 15

A. Decision tree analysis

The decision tree is a treelike model of alternative and mutually decisions with
uncertain positive or negative outcomes.

Question 16

During a risk workshop the team identified, assessed and recorded four individual risks. The team now needs to rank individual risks considering their probability and impact rates. Which of the following risks should be ranked higher?
- Risk 1 with a probability rate of 4 and an impact rate of 3
- Risk 2 with a probability rate of 3 and an impact rate of 4
- Risk 3 with a probability rate of 2 and an impact rate of 5
- Risk 4 with a probability rate of 3 and an impact rate of 5

A. Risk 1
B. Risk2
C. Risk 3
D. Risk4

Answer 16

D. Risk4

Risks may be ranked based on their individual risk scores. An individual risk
score may be assigned multiplied the probability rate by the impact rate. Risk 4
has the highest risk score (15).

Question 17

As the project matures, the team updated the risk register with new risks that have emerged and retired risks which may no longer occur. Identifying new risks that have emerged throughout the project is performed as part of:

A. Risk reviews
B. Technical performance measurement
C. Risk audit
D. The identify risks process

Answer 17

A. Risk reviews

Risk reviews can include identifying, analyzing and responding to new risks
during the project.

Question 18

A project stakeholder made an incorrect statement about risk reviews. Which one was it?

A. Risk reviews may require risk register updates
B. Risk reviews are part of risk monitoring
C. Risk reviews assess if risk management practices are effectively addressing project risk
D. Risk reviews should be frequently performed

Answer 18

C. Risk reviews assess if risk management practices are effectively addressing project risk

An assessment of the risk management practices to ensure that they are
effectively addressing project risk is known as a risk audit (answer C). The
remaining statements are correct.

Question 19

During a risk workshop, the team identified a long list of project risks. You need to ensure that the team is focused on the most important risks. Risks are usually prioritized based on:

A. Overall project risk
B. Cause, event and impact
C. Category and impact
D. Probability and impact

Answer 19

D. Probability and impact

Risks are prioritized by assessing and combining their probability of occurrence
and impact.

Question 20

You have just been assigned as project manager of a pharmaceutical research project. After identifying project risks, you need to perform a qualitative risk analysis. Which of the following may you perform as part of a qualitative risk analysis? (Choose three.)

A. Use hierarchical-type charts to rank risks
B. Determine which risks require immediate risk action
C. Perform a risk review
D. Understand risk appetite
E. Define probability and impact criteria
F. Assign scores to individual risks

Answer 20

A. Use hierarchical-type charts to rank risks
B. Determine which risks require immediate risk action
F. Assign scores to individual risks

Question 21

You have just been assigned as project manager of a pharmaceutical research project. After identifying and assessing project risks, you need to plan risk responses. Risks that remain after risk response planning are:

A. Force majeure risks
B. Residual risks
C. Pure risks
D. Secondary risks

Answer 21

B. Residual risks

Residual risks are risks that remain after response planning.

Question 21

What is the aggregated risk expected value if the project quantitative risk analysis identified 2 risks with the following probabilities and impacts?
* Risk A with a 10% probability of a 5,000 increase in materials costs
* Risk B with a 10% probability of a decrease of 2,000 in travel expenses

A. 700
B. 7,000
C. 300
D. 500

Answer 21

C. 300

The first risk has an expected monetary value (EMV) of 10%x5,000=500. The
second risk has an EMV of The overall EMV should be the sum of the individual EMV.

Question 22

You are currently planning a project with a clear scope of work. You defined a cost provision to account for risk. All of the following statements regarding reserve analysis are correct, EXCEPT:

A. The project manager should prevent changes to the established reserve
B. Is monitored trough the monitor risk process
C. Can be applied to both the schedule and cost
D. Compares the amount of contingency reserves available to the amount of risk

Answer 22

A. The project manager should prevent changes to the established reserve

As the project moves forward the reserve may be consumed, reduced or
changed through the change control mechanism. Therefore, answer A is not
correct. All other statements are correct.

Question 23

As a project manager you are assessing the quality of the data available for each risk and selecting risks for further analysis and response. What process are your performing?

A. Plan risk Management
B. Data quality
C. Perform qualitative risk analysis
D. Perform quantitative risk analysis

Answer 23

C. Perform qualitative risk analysis

Assessing the quality of the data available for each risk and selecting risks for
further analysis and response is part of the qualitative risk analysis.

Question 24

Your organization’s project management office established that critical projects should adopt quantitative risk analysis techniques. You are completing a sensitivity analysis to determine which individual risks can have the most significant impact on the project objectives. The result of this assessment may be graphically displayed by a ________________.

A. Decision tree
B. Probabilistic distribution
C. Simulation
D. Tornado chart

Answer 24

D. Tornado chart

Sensitivity analysis is frequently represented graphically through a tornado chart.

Question 25

During risk monitoring a new risk is identified. What should be done next?

A. Ignore the risk
B. Establish a workaround
C. Document the risk on the watch list
D. Perform qualitative analysis

Answer 25

D. Perform qualitative analysis

The risk was identified but we do not have information to assume that it
happened. Therefore we should analyze it.

Question 26

You are currently planning a project with a clear scope of work. You estimated project costs and defined a cost provision to account for risk. A contingency reserve is _____________ .

A. An active risk acceptance response
B. Determined by a risk audit
C. A passive risk acceptance response
D. Not a risk response strategy

Answer 26

A. An active risk acceptance response

A contingency reserve is an active risk acceptance response.

Question 27

James is a junior project manager Who has just been assigned to his first project. After defining the risk management plan, James identified the individual project risks and recorded them in the project risk register. What has he done wrong?

A. Team members should be engaged in risk identification
B. Key stakeholders should be engaged in risk identification
C. Individual risks should be recorded in the risk management plan
D. The risk management plan should be prepared after identifying risks

Answer 27

B. Key stakeholders should be engaged in risk identification

Risk identification should be a collective effort, involving the project manager,
team members, subject matter experts, customer representatives, risk management experts, suppliers and other relevant internal or external contributors (answer B). Team members should be engaged in risk identification, but so should other relevant stakeholders (answer A). Risks should not be recorded in the risk management plan (answer C). The risk management plan should be prepared before identifying risks (answer D).

Question 28

You are currently planning a project with a clear scope of work. You estimated project costs and defined a cost provision to account for risk. How can the management reserve be used in risk management?

A. Manage unknown-unknowns
B. Manage risks identified by management
C. Manage known-unknowns
D. Account for profit

Answer 28

A. Manage unknown-unknowns

A management reserve is a provision of time or costs, held by management, to
compensate for unforeseen events. Management reserve is created to manage
unknown-unknowns.

Question 29

You want to reduce the probability and the impact of a risk to a level where it can be accepted. You want to implement a ____________ risk response strategy.

A. Avoid
B. Mitigate
C. Contingent
D. Reduce

Answer 29

B. Mitigate

Risk mitigation reduces the risk to a level that is acceptable.

Question 30

After preparing several management plans, the project manager is ready to move on into risk identification. Who should participate in the identify risk process?

A. The project manager
B. The project manager and the customer
C. The project manager, the team and the customer
D. The project manager, other project managers, team members, the customer, subject experts

Answer 30

D. The project manager, other project managers, team members, the customer, subject experts

Participants in risk identification activities can include the project manager,
other project managers, team members, the customer, subject experts, risk
management team, end users and other relevant stakeholders.

Question 31

On a recently initiated telecommunications project, you are defining the actions required to address individual risks. Which of the following may you update next?

A. Risk register
B. Schedule and WBS
C. Procurement management plan
D. All of the above

Answer 31

D. All of the above

The adopted risk responses should be recorded in the risk register (answer A).
They may also require project management plan updates (answers B and C).

Question 32

During a risk workshop, the team identified a long list of project risks. You need to ensure that the team is focused on the most important risks. Which of the following may be used to prioritize individual risks? (Choose three.)

A. Overall project risk
B. Cause
C. Urgency
D. Probability and impact
E. Event
F. Proximity

Answer 32

C. Urgency
D. Probability and impact
F. Proximity

Risks may be prioritized considering multiple factors including the risk urgency
(answer C), the risk probability and impact (answer D) and the risk proximity
(answer F).

Question 33

You have just been assigned as project manager of a pharmaceutical research project. After identifying and assessing project risks, you need to plan risk responses. The outputs of risk response planning include: (Choose three.)

A. Retire risks
B. Update the project management plan and project documents
C. Accept residual risks and address secondary risks
D. Prepare contingency plans and fallback plans
E. Escalate risks and assess technical performance

Answer 33

B. Update the project management plan and project documents
C. Accept residual risks and address secondary risks
D. Prepare contingency plans and fallback plans

Retiring risks and assessing technical performance are part of monitoring risks
(answers A and F). The remaining options are part of risk response planning.

Question 34

You are developing the communications management plan on a robotic system project. What should you do NEXT?

A. Identify project risks
B. Ensure that there is a common understanding of how to manage risks
C. Prepare the project WBS
D. Identify project stakeholders

Answer 34

B. Ensure that there is a common understanding of how to manage risks

If the project manager is planning communications management, the WBS
(answer C) and the stakeholder register (answer D) should have been defined
already. Risks should be identified (answer A) after defining the risk
management plan (answer B).

Question 35

You have been hired by a consulting company to manage a large process improvement project. After identifying and assessing risks, you are now in the middle of risk response planning. Which of the following risk response strategies are applicable to both threats and opportunities? (Choose two.)

A. Contingency plan
B. Accept
C. Mitigate
D. Probability
E. Escalate
F. Share

Answer 35

B. Accept
E. Escalate

Question 36

Paul identified 30 risks that may impact his back office system implementation project. Paul wants to categorize individual risks ensure that they are logically organized. Which of the following are potential benefits of assigning risk categories to individual risks? (Choose three.)

A. Establish how risks will be managed throughout the project.
B. Improve reporting
C. Organize risk-related historical information
D. Focus risk responses on concentrations of risks
E. Provide symptoms or warning signs that a risk is about to occur
F. Measure the severity of an individual risks

Answer 36

B. Improve reporting
C. Organize risk-related historical information
D. Focus risk responses on concentrations of risks

The risk management approach is established in the risks management plan
(answer A). Triggers provide symptoms or warning signs that a risk is about to
occur (answer E). Individual risk scores assess individual risks (answer F). The
remaining options express potential benefits of assigning risk categories to
individual risks.

Question 37

After receiving the risk report a senior manager is worried because he does not understand the concept of secondary risk. You should explain that a secondary risk is a risk that:

A. Emerges from the adopted risk responses
B. Subsists after the adopted risk responses
C. Did not require proactive responses
D. Was identified during risk monitoring

Answer 37

A. Emerges from the adopted risk responses

Secondary risks are risks that emerge from the adopted risk responses.

Question 38

A project does not have a risk register. Which project management process has been most likely missed?

A. Plan risk management
B. Identify risks
C. Perform qualitative analysis
D. Plan Risk Responses

Answer 38

B. Identify risks

The risk register is an output of the identify risks process.

Question 39

James is a junior project manager Who has just been assigned to his first project. James is unsure about which process, or processes, assess the risks’ probability and impact. What should you reply?

A. Identify risks
B. Perform qualitative risk analysis
C. Perform quantitative risk analysis
D. Perform qualitative risk analysis, perform quantitative risk analysis and monitor risks

Answer 39

D. Perform qualitative risk analysis, perform quantitative risk analysis and monitor risks

Probability and Impact can be assessed as part of perform qualitative risk
analysis, perform quantitative risk analysis and monitor risks

Question 40

After identifying and assessing a project threat, the team decided to accept it. Which of the following circumstances may justify accepting a project threat?

A. The existing data about the threat is unreliable
B. The threat has never happened before
C. It is not possible to implement a workaround
D. There are no available responses that can mitigate, transfer or avoid the threat

Answer 40

D. There are no available responses that can mitigate, transfer or avoid the threat

Accepting the threat may be the only option if there are no available responses
that can mitigate, transfer or avoid the threat.

Question 41

You are a customer project manager for a plant extension project. The project needs to procure services from a consulting firm. What contract type would help you transfer risk to the supplier?

A. Cost reimbursable contract
B. Time and material contract
C. Fixed price contract
D. Transfer

Answer 41

C. Fixed price contract

In a fixed price contract, the buyer does not receive ownership of the project risks.

Question 42

A risk that has not previously been identified has occurred. As a project manager, what should you do FIRST?

A. Disregard the risk because risk identification has been completed
B. Update the risk registerto reflect the probability and impact of the risk
C. Develop a workaround
D. Perform a quality audit on the risk management process

Answer 42

C. Develop a workaround

When the risk occurs and there is no planned response, the first priority should
be to solve the problem through a workaround.

Question 43

Your organization’s project management office established that every project should adopt a standardized risk register. Which of the following requires risk register updates?

A. Risk identification
B. Risk response planning
C. Risk monitoring
D. All of the above

Answer 43

D. All of the above

Risk identification, risk response planning and risk monitoring require risk
register updates.

Question 44

There has been some confusion about the meaning of risk appetite. You should clarify that risk appetite describes:

A. Degree of uncertainty the stakeholder is willing to accept
B. Maximum variance on project objectives the stakeholder is Willing to accept
C. Attitude toward risk where satisfaction increases with risk exposure
D. Symptoms or warning signs that the risk is about to occur

Answer 44

A. Degree of uncertainty the stakeholder is willing to accept

Question 45

You are managing a critical project that Will redesign your company’s website. You want to ensure that the project risks are managed effectively. Which of the following is the correct sequence of the risk management processes?

A. Identify risks, perform qualitative risk analysis, perform quantitative risk analysis, plan risk management, monitor risks
B. Identify risks, perform qualitative risk analysis, perform quantitative risk analysis, plan risk responses, implement risk responses, monitor risks
C. Plan risk management, identify risks, perform qualitative risk analysis, perform quantitative risk analysis, plan risk responses
D. Risk strategy, identify risks, perform risk analysis, plan risk responses, implement risk responses

Answer 45

C. Plan risk management, identify risks, perform qualitative risk analysis, perform quantitative risk analysis, plan risk responses

The correct sequence is: plan risk management, identify risks, perform
qualitative risk analysis, perform quantitative risk analysis, plan risk responses,
implement risk responses and monitor risk

Question 46

You are working with your team identifying and recording the uncertain events that can impact project objectives. Which of the following activities should be performed before moving on to the next process?

A. Completing a root cause analysis to determine the risk causes
B. Identifying the risks that should be managed more aggressively
C. Identifying risk responses
D. Identifying the risk trend

Answer 46

A. Completing a root cause analysis to determine the risk causes

You are identifying project risks. Determining the risk causes is the only option
that is also part of risk identification.

Question 47

You are a project manager for a skincare company. Your organization’s project management office established that critical projects should adopt quantitative risk analysis techniques. Quantitative risk analysis should be performed:

A. Only on residual risks
B. Only on risks that were prioritized by the qualitative risk analysis
C. Only on risks that have a risk response plan
D. Only on risks that were prioritized according to their expected monetary value

Answer 47

B. Only on risks that were prioritized by the qualitative risk analysis

The perform quantitative risk analysis process should be performed only on
risks that have been prioritized by the perform qualitative risk analysis process.

Question 48

A project risk has a probability of 0.1 and a potential loss of 10,000. If the project budget is 100,000, what is the risk expected monetary value?

A. 99,000
B. 90,000
c. (10,000)
D. (1 ,000)

Answer 48

D. (1 ,000)

Question 49

You are currently conducting a quantitative risk analysis. What should you focus on during the process?

A. Perform a cost-benefit assessment
B. Use a decision tree analysis
C. Determine how the contingency Will be estimated
D. Deepen the understanding of the project uncertainty

Answer 49

D. Deepen the understanding of the project uncertainty

The quantitative risk analysis numerically assesses individual risks to deepen
our understanding of them (answer D). A feasibility analysis should be
completed before the project authorization (answer A). A decision tree is a
technique used in quantitative risk analysis but it is not the reason why the risks
are quantitatively analyzed (answer B). Determining how the contingency Will be
estimated is part of risk management planning (answer C).

Question 50

The risk register is updated throughout the project. Which information is updated during risk identification?

A. Identified risks, owners and triggers
B. Identified risks and potential responses.
C. Identified risks, causes and residual risks
D. Identified risks, triggers and impacts

Answer 50

B. Identified risks and potential responses.

The risk register includes a list of identified risks, with detailed information on
causes, events, impacts, and a list of potential responses.

Question 51

As a project manager in a real estate project, you have identified, assessed and prioritized individual risks, as well as planned risk responses. What should you do NEXT?

A. Establish workarounds
B. Define the risk management plan
C. Implement risk responses
D. Assess the individual risks’ probability and impact numerically

Answer 51

C. Implement risk responses

You have planned risk responses. You should now implement risk responses
(answer C). You have, therefore, already prepared the risk management plan
(answer B) and performed a quantitative risk analysis (answer D). The risks have
not occurred so there is no need to establish workarounds (answer A).

Question 52

You have a 60% likelihood of earning 50,000 profit and a 20% likelihood of losing 100,000. What is the Expected Monetary Value?

A. 50,000 loss
B. 10,000 loss
C. 10,000 profit
D. 50,000 profit

Answer 52

C. 10,000 profit

Question 53

Olivia is managing an airport extension project that is well underway. One team member notified Olivia that the project is at risk of not complying with regulation. After two days of intense meetings, the sponsor decided to cancel the project to ensure that it does not infringing regulation. Which risk response strategy was adopted?

A. Mitigate
B. Accept
C. Avoid
D. Termination

Answer 53

C. Avoid

The avoid risk response strategy eliminate the risk entirely by changing the
project management plan.

Question 54

You are working closely with risk owners to ensure that the project risks are reviewed regularly. The purpose of monitoring risks is to:

A. Refresh the information on individual risks and overall project risk
B. Plan workarounds
C. Take action to manage the risk
D. All of the above

Answer 54

A. Refresh the information on individual risks and overall project risk

Risk monitoring refreshes the information on individual risks and overall project
risk (answer A). Workarounds are not planned (answer B). Taking action to
manage the risk (answer C) is part of the risk response implementation.

Question 55

You need to ensure that the team is focused on the most important risks. Which of the following elements is LEAST relevant when prioritizing individual risks?

A. Owner
B. Data quality
C. Proximity
D. Urgency

Answer 55

A. Owner

The risk owner is the individual responsible for detailing the risk response,
implementing the response and confirming that the response was effective
(answer A). The remaining answers can influence risk prioritization.

Question 56

The latest risk report provides evidence of a poor risk management practice. Which one was it?

A. Some risk responses did not require project management plan updates
B. The team is using the risk review meetings to identify new risks
C. The impact of a previously identified threat was reassessed
D. The team wants to avoid future risk monitoring by improving risk response planning

Answer 56

D. The team wants to avoid future risk monitoring by improving risk response planning

Improving risk response planning does avoid future risk monitoring (answer D).
The remaining answers represent valid practices.

Question 57

You are managing a critical project that will redesign your company’s website. The team is segmenting the risk register according to the individual risk scores, separating high priority risks from low priority risks. How should the team handle the risks recorded in the watch list?

A. Numerically assess them
B. Report them to management
C. Revisit them during risk monitoring
D. Mitigate them

Answer 57

C. Revisit them during risk monitoring

The team should periodically revisit the watch list as the project progresses,
checking for changes in risk scores that suggest a more aggressive risk
response is needed (answer C). Low-priority risks do not typically require a
quantitative risk analysis (answer A) and are not typically reported to
management (answer B). Low-priority risks are typically accepted (answer D).

Question 58

A project manager knows that a specific technology has caused many performance problems on previous projects in the organization. As a result, the project manager decided to outsource part of the work. This is an example of a ___________ risk response strategy.

A. Share
B. Procurement
C. Avoid
D. Transfer

Answer 58

D. Transfer

Transfer is a thread response strategy that transfers the ownership and impact of the risk to another entity.

Question 59

Jessica is determining responses strategies to identified project risks. Which of the following are potential responses to threats?

A. Enhance and accept
B. Avoid and share
C. Transfer and mitigate
D. Accept and share

Answer 59

C. Transfer and mitigate

Response strategies to threats include: accept, avoid, mitigate and transfer.

Question 60

You have been hired to manage a large project. During a team meeting, two team members cannot agree on the existing threat response strategies. Which of the following are threat response strategies? (Choose three.)

A. Workaround
B. Share
C. Transfer
D. Mitigate
E. Exploit
F. Escalate

Answer 60

C. Transfer
D. Mitigate
F. Escalate

Question 61

You have just taken over a system integration project with a history of poor risk management. You were asked to take control over project risks. Which of the following best describes how project risk relates to the project life cycle?

A. Risk increases throughout the project as new risks can arise
B. Risk decreases throughout the project as previously identified risks are closed
C. Risk remains steady
D. There is no relationship between risk and the project life cycle.

Answer 61

B. Risk decreases throughout the project as previously identified risks are closed

Project risk is greatest at the initial stages of the project life cycle.

Question 62

You are a project manager for a skincare company. Your organization’s project management office established that critical projects should adopt quantitative risk analysis techniques. All of the following options are part of the quantitative risk analysis process, EXCEPT:

A. Calculate the expected monetary value of project decisions
B. Assess the impact of risks on project objectives
C. Perform a quantitative assessment of the risk response
D. Statistically analyze the schedule and budget risk

Answer 62

C. Perform a quantitative assessment of the risk response

Quantitative risk analysis analyzes risks, not responses.

Question 63

You are taking on an hybrid project for the first time. You met with key stakeholders and subject matter experts and collected a large set of project risks. All of the following options are part of risk identification, EXCEPT:

A. Identifying risk causes
B. Identifying the critical risks
C. Analyzing assumptions
D. Identifying the risks potential responses

Answer 63

B. Identifying the critical risks

Identifying critical risks is part of a qualitative risk analysis. All other options are
part of the identify risks process.

Question 64

You have been hired by a consulting company to manage a large process improvement project. After identifying and assessing risks, you are now in the middle of risk response planning. Which of the following sets of elements may be recorded during the process?

A. Contingency plans and risk owners
B. Triggers and contingency response triggers
C. Residual risks and actions required to implement passive acceptance risk responses
D. Frequency of risk review meetings and secondary risks

Answer 64

B. Triggers and contingency response triggers

Triggers and contingency response triggers are identified during risk response
planning (answer B). Risk owners are assigned in the qualitative risk analysis
(answer A). Passive acceptance risk responses do not require actions (answer
C). The risk reviews’ frequency is defined in the risk management plan (answer

Question 65

A project manager is working with her team to determine a risk workaround. In which project management process is the project manager in?

A. Corrective action
B. Risk response planning
C. Risk response implementation
D. Risk monitoring

Answer 65

D. Risk monitoring

A workaround is part of risk monitoring.

Question 66

While preparing the risk management plan, the project manager is defining the probability scale that Will be used in the probability and impact matrix. Which of the following represents very likely risks?

A. A probability rating of0
B. A probability rating of 0.9
C. A probability rating of 1
D. A probability rating of 1.1

Answer 66

B. A probability rating of 0.9

In a probability scale, 0 and 1 should not exist as they represent the lack of
uncertainty. Therefore, 0.9 is the highest available options.

Question 67

Which of the following statements regarding risk response planning are correct? (Choose three.)

A. The avoid risk response strategy removes the opportunity uncertainty
B. The share risk response strategy is a proactive risk response
C. The exploit risk response strategy reduces the opportunity uncertainty
D. The enhance risk response strategy reduces the opportunity uncertainty
E. The mitigate risk response strategy minimizes the opportunity uncertainty
F. The increase risk response strategy increases the probability and impact of the opportunity

Answer 67

B. The share risk response strategy is a proactive risk response
C. The exploit risk response strategy reduces the opportunity uncertainty
D. The enhance risk response strategy reduces the opportunity uncertainty

Question 68

You are mentoring a junior project manager Who is currently assessing project risks. You should tell him that he should perform a qualitative risk assessment because it can help to:

A. Determine the project probability and impact matrix
B. Determine risk thresholds
C. Select risks for further analysis and response
D. Assess the risk trend

Answer 68

C. Select risks for further analysis and response

Selecting risks for further analysis and response is part of a qualitative risk
analysis (answer C). The project probability and impact matrix (answer A) and
risk thresholds are established in the risk management plan (answer B). Risk
trends are assessed (answer D) as part of risk monitoring.

Question 69

Your back office system implementation project has been going for several months, and so far it remains on track. You are working closely with risk owners to ensure that the project risks are reviewed regularly. Which of the following activities may be performed as part of risk monitoring? (Choose three.)

A. Monitor unknown-unknowns
B. Perform a risk audit
C. Customize the risk management approach to suit the project context
D. Close risks
E. Reassess risks

Answer 69

B. Perform a risk audit
D. Close risks
E. Reassess risks

Unknown-unknown are emergent risks that could not be previously identified
(answer A). Customizing the risk management approach to suit the project
context (answer C) is part of risk management planning. The remaining options
are part of risk monitoring.

Question 70

The team identified individual risks, assigned scores to these risks using a probability and impact matrix and then ranked them according to their individual scores. Which of the following should be done NEXT?

A. Identify residual risks
B. Prepare risk responses
C. Assess the quality of the available risk data
D. Calculate the risks expected monetary value

Answer 70

C. Assess the quality of the available risk data

The team is performing a qualitative risk analysis. Assessing the quality of the
available risk data is also part of a qualitative risk analysis.

Question 71

You have just taken over a system integration project with a history of poor risk management. You were asked to take control over project risks. When communicating risk information, the project manager should be more concerned with:

A. Provide risk metrics according to the project charter
B. Provide accurate risk information to all stakeholders.
C. Only provide information that has been defined in the communications management plan
D. Maintain files of all risk management communication

Answer 71

B. Provide accurate risk information to all stakeholders.

The project manager should provide accurate information

Question 72

You want to identify project risks based on input from several experts. To avoid biased results, you will send anonymous questionnaires to the experts. Which risk identification technique Will you perform?

A. Checklists
B. Expertjudgement
C. Brainstorming
D. Delphi technique

Answer 72

D. Delphi technique

In the Delphi technique, a consensus is reached by repeatedly consulting
experts, usually through an anonymous process.

Question 73

Emma is a project manager on a large Oil and gas project with several key stakeholders, including government agencies and business partners. She is revisiting the project assumptions and their supporting information to test their consistency, accuracy and reliability. Assumption analysis is mainly used to:

A. Planning risk management
B. Planning risk responses
C. Identifying risks
D. Performing qualitative risk analysis

Answer 73

C. Identifying risks

Assumptions have, by definition, some level of uncertainty. The project team
can identify risks by reviewing the consistency and information quality of the
documented assumptions.

Question 74

You are taking on an hybrid project for the first time. You met with key stakeholders and subject matter experts and collected a large set of project risks. What elements should be recorded in the risk register during risk identification?

A. New risks, risk status and workarounds
B. Risks, risk causes, risk events, risk impact and potential responses
C. Risk owners, triggers, residual risks and secondary risks
D. Risks requiring further analysis, prioritized list of risks and watch list

Answer 74

B. Risks, risk causes, risk events, risk impact and potential responses

During risk identification the team should document risks, risk causes, risk
events, risk impact and potential responses.

Question 75

You are currently going through the plan risk responses process. Which of the following activities may you perform?

A. Preparing contingency plans and identifying contingency response triggers
B. Assess overall project risk
C. Identifying risk causes
D. Prioritizing individual risks

Answer 75

A. Preparing contingency plans and identifying contingency response triggers

Preparing contingency plans and identifying contingency response triggers are
part of risk responses planning (answer A). Assessing overall project risk
(answer B) and prioritizing individual risks (answer D) are part of the perform
qualitative risk analysis process. Identifying risk causes (answer C) is part risk
identification.

Question 76

As part of the ongoing risk monitoring effort, the project management team is determining the project risk scores. Risk scores should be compared to:

A. Risk threshold
B. Risk trigger
C. Risk tolerances
D. Risk owners

Answer 76

A. Risk threshold

Risk threshold is the limit beyond which stakeholders are unwilling to accept the
risk exposure and additional risk responses are required. They can be used as a
benchmark to monitor risk scores.

Question 77

One of the following is not necessarily performed in every project. Which one is it?

A. Plan risk management
B. Perform quantitative risk analysis
C. Implement risk responses
D. Monitor risks

Answer 77

B. Perform quantitative risk analysis

The value of a thorough numerical assessment of project risk relies on high
quality data. However, supporting risk historical information may not be
available, or it may not be possible to obtain it cost effectively. Therefore, the
quantitative risk analysis is not mandatory (answer B). The remaining options
should be performed in every project.

Question 78

You have been asked to manage the new network implementation project. As the planning effort progresses, you are now able to identify risks. Which of the following may you take in as an input into risk identification? (Choose three.)

A. Expert judgement
B. Scope baseline
C. Organizational process assets
D. Risk management plan
E. Risk report

Answer 78

A. Expert judgement
B. Scope baseline
D. Risk management plan

Question 79

You company formed a team to digitize a legacy system. After identifying the project risks, you are assessing the quality of the data available for each individual risk. How does data quality impact risk management?

A. It impacts the overall project risk ranking
B. It provides information about the risk impact on quality objectives
C. It provides information about the likelihood of meeting project objectives
D. It provides information about how much we know about the risk

Answer 79

D. It provides information about how much we know about the risk

Data quality assesses how much do we know about the risk.

Question 80

An assessment of overall project risk can be recorded in the:

A. Risk management plan
B. Risk report
C. Risk response plan
D. Risk register and risk management plan

Answer 80

B. Risk report

The overall project risk can be recorded in the risk register and risk report.

Question 81

The project manager and a number of team members were involved in a risk management exercise. They made a prioritized list of the project risks, determine response strategies and added an owner for each action. However, some of the adopted responses generated other project risks. This is an example of:

A. Residual risks
B. Accepted risks
C. Secondary risks
D. Force majeure

Answer 81

C. Secondary risks

Question 82

The project management team is about to start planning risk responses. After reading the risk management plan, one team member is worried because she does not understand the concept of fallback plan. You should explain to the team member that a fallback plan is:

A. A provision of time or costs for unforeseeable events
B. Alternative risk response, or plan B, activated if the main risk response is ineffective.
C. A planned course of action implemented if the specified risk events occur
D. Reducing the probability or impact of the risk by revising the project management plan

Answer 82

B. Alternative risk response, or plan B, activated if the main risk response is ineffective.

A fallback plan is an alternative risk response, or plan B, activated if the main
risk response is ineffective.

Question 83

During the monitor risks process the project manager closed a risk that could no longer occur. Which technique was the project manager using?

A. Risk audits
B. Risk inspection
C. Risk review
D. Variance and trend analysis

Answer 83

C. Risk review

Project risk review reassess current risks and close risks that are outdated.

Question 84

You have just been assigned as project manager of a pharmaceutical research project. You are working with your team determining the project’s overall risk score. Which of the following are you working on?

A. Planning risk management
B. Performing qualitative risk assessment
C. Performing quantitative risk assessment
D. Monitoring risks

Answer 84

B. Performing qualitative risk assessment

The project’s overall risk score is determined as part of a qualitative risk
analysis.

Question 85

The PMO wants to improve risk management practices by establishing risk thresholds. A junior project manager in your company asked for your help because he does not understand the purpose of risk thresholds. You should tell him that he should determine risk thresholds because they will help him to:

A. Measure the effectiveness of the risk response plan execution
B. Identify Who is the owner ofthe risk responses
C. Determine how risk management Will be performed
D. Identify when risks are about to occur

Answer 85

A. Measure the effectiveness of the risk response plan execution

Risk thresholds help in determining the acceptable level of variation around project objectives. By establishing these thresholds, a project manager can measure whether the risk response plans are effective in keeping the project within acceptable risk limits.
Establishing risk thresholds helps measure the effectiveness of the risk response plan execution by defining the acceptable levels of risk variation around project objectives. This ensures that the project remains within the organization’s risk appetite and that appropriate actions are taken when thresholds are exceeded.

Question 86

Mary has just been assigned to a large international project adopting a conventional approach. She is currently identifying project risks using the Delphi technique. In which of the following contexts can the Delphi technique be particularly useful to identify project risks?

A. There is no experience in the subject
B. The team needs to make a quick decision
C. The team is scattered across different countries
D. Risks are organized into categories

Answer 86

C. The team is scattered across different countries

The Delphi technique would allow a facilitator to collect the risks identified by
experts from various countries. Risks would be collected, summarized and sent
back to the experts. The process would be repeated until a reasonable
consensus was achieved.

Question 87

Paul identified 30 risks that may impact his back office system implementation project. Paul wants to categorize individual risks ensure that they are logically organized. What tool should Paul use?

A. Decision tree
B. Probability and impact matrix
C. Risk breakdown structure
D. Risk tree

Answer 87

C. Risk breakdown structure

A risk breakdown structure is a hierarchical representation of project risks
grouped into categories. Decision trees (answer A) and probability impact
matrix (answer B) would not organize risks by category. Risk tree (answer D) is
not a project management technique.

Question 88

You are a project manager for a skincare company. Your organization’s project management office established that critical projects should adopt quantitative risk analysis techniques. Which of the following statements regarding the perform quantitative risk analysis process are correct?

A. It is easyto implement
B. It is 100% accurate
C. It should be used to assess every risk
D. It is more accurate than a qualitative analysis

Answer 88

D. It is more accurate than a qualitative analysis

The perform quantitative risk analysis process is more accurate than a
qualitative analysis.

Question 89

As the project progresses, the team updated the risk register with new risks that have emerged and retired risks which may no longer occur. Risk reviews are part of:

A. Quantitative risk analysis
B. Qualitative risk analysis
C. Risk response planning
D. Risk monitoring

Answer 89

D. Risk monitoring

Risk reviews are performed as part of risk monitoring.

Question 90

Olivia is managing an airport extension project that is well underway. She is using a decision tree to decide whether the team should develop or procure externally a complex deliverable. Which of the following statements regarding decision trees are correct? (Choose three.)

A. Is a project simulation technique
B. Is a qualitative risk analysis technique
C. Provides a graphical representation of existing alternatives
D. Links decisions to expected outcomes
E. Assesses the probability of meeting a project objective
F. Determines the expected monetary value of each alternative decision

Answer 90

C. Provides a graphical representation of existing alternatives
D. Links decisions to expected outcomes
F. Determines the expected monetary value of each alternative decision

Decision trees provide a graphical representation of existing alternatives, link decisions to expected outcomes, and determine the expected monetary value of each alternative decision. These features make decision trees a valuable tool in quantitative risk analysis for making informed decisions.

Question 91

A friend of yours is unsure of how unknown-unknowns should be managed. What should you recommend?

A. Ensure that there are enough funds to account for unknown-unknowns
B. Document unknown-unknowns in the project risk register
C. Establish a contingency reserve
D. Ensure that the team identifies and responds to every individual risk

Answer 91

A. Ensure that there are enough funds to account for unknown-unknowns

The management reserve accounts for unknown-unknowns (answer A). The
remaining statements are incorrect.

Question 92

You have just been assigned as project manager of a pharmaceutical research project. After identifying and assessing project risks, you need to plan risk responses. Strategies for dealing with positive risks or opportunities include:

A. Avoid, transfer and mitigate
B. Accept, share and exploit
C. Transfer, enhance and share
D. Avoid, enhance and transfer

Answer 92

B. Accept, share and exploit

Question 93

Your plant extension project is running behind schedule and overrunning the budget. It’s the end of the design phase and the steering committee requested a risk review. How does a risk review differ from a risk audit?

A. A risk audit is only conducted at the end of the project
B. A risk review focuses on the overall project risk, while a risk audit focuses on the individual risk
C. A risk review focuses on individual risks and overall project risk, while the risk audit focuses on the risk management process
D. A risk review is normally conducted by an external team, while a risk audit is conducted by team members

Answer 93

C. A risk review focuses on individual risks and overall project risk, while the risk audit focuses on the risk management process

A risk review is a periodical re-evaluation of identified risks and their responses.
It is therefore focused on individual risks (answer B). A risk audit assesses if the
risk management procedures were adopted and are appropriate. It is therefore
focused on the risk management process. A risk audit can be conducted
throughout the project (answer A). A risk review is usually conducted inside the
team and a risk audit is usually performed by an external entity (answer D).

Question 94

The project manager is preparing a lessons learned session regarding the risk management approach. Who should be involved on the lessons learned session?

A. Project manager and team
B. Project manager, team, suppliers and project manager
C. Risk manager, customer, project manager and team
D. All of above

Answer 94

D. All of above

All relevant stakeholders should participate.