You are the project manager of the YHG project for your company. Within the project, you and the project team have identified a risk event that could have a financial impact on the project of $450,000. This risk event has a 70 percent chance of occurring in the project. The project identifies a solution that will reduce the probability of the risk event to ten percent, but it will cost $260,000 to implement. Management agrees with the solution and asks that you include the risk response in the project plan. What risk response is this?

1. A. This is mitigation because the response reduces the probability.
2. B. This is not a risk response, but a change request.
3. C. This is transference because of the $260,000 cost of the solution.
4. D. This is avoidance because the risk response caused the project plan to be changed.

Correct Answer: A

You are the project manager of a large construction project. You are evaluating the strengths, weaknesses, opportunities, and threats involved in a project. In which of the following processes are you on?

1. A. Define Scope
2. B. Plan Risk Responses
3. C. Plan Risk Management
4. D. Identify Risks

Correct Answer: D

You are the project manager of the NHK Project. Management wants to know how often your risk identification process will occur during the project. Considering that your project is scheduled to last one year and involvs five distinct phases, how often should risk identification take place?

1. A. Monthly
2. B. Once per project life cycle phase
3. C. Quarterly
4. D. Vary depending on the situations within the project

Correct Answer: D

Diana is the project manager of the QPS project for her company. In this project Diana and the project team have identified a pure risk. Diana and the project team decided, along with the key stakeholders, to remove the pure risk from the project by changing the project plan altogether. What is a pure risk?

1. A. It is a risk event that is generated due to errors or omission in the project work.
2. B. It is a risk event that is created by a risk response.
3. C. It is a risk event that only has a negative side, such as loss of life or limb.
4. D. It is a risk event that cannot be avoided because of the order of the work.

Correct Answer: C

You work as a project manager for BlueWell Inc. You would like to utilize sensitivity analysis in your project, but the management does not understand how this will be displayed. What type of chart is usually used with sensitivity analysis to show the relative affect of risks on the project?

1. A. Ishikawa chart
2. B. Force field analysis chart
3. C. GERT Chart
4. D. Tornado diagram

Correct Answer: D