CAPM Risk Management 5 — Questions and Answers
Question 1: Which of the following describes the overall risk of a project rather than individual risks?
- Residual risk
- Secondary risk
- Overall project risk (Correct answer)
- Individual project risk
Correct answer: Overall project risk
Overall project risk represents the combined effect of all project uncertainties on the project outcome as a whole.
Question 2: A risk probability and impact matrix is used primarily to:
- Assign risk owners
- Calculate EMV for each risk
- Prioritize risks for further analysis (Correct answer)
- Document risk response strategies
Correct answer: Prioritize risks for further analysis
The probability and impact matrix helps categorize and prioritize risks based on their likelihood and potential effect.
Question 3: Which of the following is an example of a risk mitigation strategy?
- Purchasing insurance for potential losses
- Canceling a project activity that carries high risk
- Adding prototype testing to reduce technical uncertainty (Correct answer)
- Assigning a risk to a third-party vendor
Correct answer: Adding prototype testing to reduce technical uncertainty
Mitigation reduces the probability or impact of a risk, and prototyping is a classic example of reducing technical uncertainty.
Question 4: Which technique involves gathering expert opinions anonymously to identify and assess risks?
- Brainstorming
- Nominal group technique
- Delphi technique (Correct answer)
- Root cause analysis
Correct answer: Delphi technique
The Delphi technique uses multiple rounds of anonymous expert input to build consensus on risk identification and assessment.
Question 5: A project's risk threshold defines:
- The total budget allocated for risk responses
- The level of risk exposure above which action must be taken (Correct answer)
- The maximum number of risks that can be accepted
- The probability of all risks occurring simultaneously
Correct answer: The level of risk exposure above which action must be taken
Risk thresholds are specific points at which a risk becomes unacceptable and must be addressed with a response.
Question 6: When performing Identify Risks, which of the following is an output?
- Risk management plan
- Risk register updates (Correct answer)
- Probability and impact matrix
- Project scope statement
Correct answer: Risk register updates
The risk register is created or updated as an output of the Identify Risks process, capturing all newly identified risks.
Question 7: A project manager notices that after implementing a risk response, the risk still has a residual probability of 10%. This remaining risk is called:
- Secondary risk
- Residual risk (Correct answer)
- Accepted risk
- Transferred risk
Correct answer: Residual risk
Residual risks are the risks that remain after risk responses have been implemented and should be monitored.
CAPM Risk Management 5
Which of the following describes the overall risk of a project rather than individual risks?