GCP Risk Assessment & Management 5 — Questions and Answers
Question 1: A project team uses a decision tree to evaluate two alternative approaches. Decision trees are PRIMARILY used to:
- Identify stakeholder influence on risks
- Calculate EMV across multiple decision paths with uncertain outcomes (Correct answer)
- Assign risk owners from the team
- Rank risks in the risk register
Correct answer: Calculate EMV across multiple decision paths with uncertain outcomes
Decision trees diagram possible choices and uncertain outcomes, calculating the expected monetary value of each branch to support decisions.
Question 2: During a risk review meeting, the team notes that a previously accepted risk has exceeded its defined threshold. What should happen NEXT?
- The risk should be removed from the register
- A risk response should now be developed and implemented (Correct answer)
- The threshold should be raised to match the current risk level
- The project should be suspended
Correct answer: A risk response should now be developed and implemented
When a risk exceeds its threshold, acceptance is no longer appropriate and an active response must be developed.
Question 3: What is the 'risk threshold' in project risk management?
- The budget allocated for all risk responses
- The level of risk exposure above which an active response is required (Correct answer)
- The number of risks a project can carry without escalating to the sponsor
- The probability at which a risk is automatically transferred
Correct answer: The level of risk exposure above which an active response is required
The risk threshold is the organization's or stakeholder's tolerance boundary; risks exceeding it require active management.
Question 4: A project manager uses an Ishikawa (fishbone) diagram during risk identification. What is its PRIMARY purpose in this context?
- To visualize the project schedule and critical path
- To identify root causes of potential risk events (Correct answer)
- To rank risks by probability and impact
- To allocate contingency reserves by risk category
Correct answer: To identify root causes of potential risk events
Ishikawa diagrams map cause-and-effect relationships, helping teams trace potential risk events back to their root causes.
Question 5: An agile project team discusses risks at the start of each sprint. This practice BEST aligns with which risk management principle?
- Risks should only be assessed at project initiation
- Risk management is a continuous, iterative process throughout the project (Correct answer)
- Risk responses are the sole responsibility of the project manager
- Risk registers should not be maintained in agile environments
Correct answer: Risk management is a continuous, iterative process throughout the project
Agile emphasizes continuous risk identification and response through iterative planning events like sprint reviews and retrospectives.
Question 6: Which of the following is an example of an 'avoid' risk response strategy?
- Buying insurance to cover potential losses
- Changing the project plan to eliminate a risky activity entirely (Correct answer)
- Setting aside contingency funds in case the risk occurs
- Assigning the risky work to an experienced subcontractor
Correct answer: Changing the project plan to eliminate a risky activity entirely
Avoidance changes the project plan — often scope, schedule, or approach — to remove the risk entirely rather than manage its impact.
Question 7: A project manager is preparing a risk report for senior leadership. Which metric MOST effectively communicates the overall level of project risk?
- Total number of risks in the register
- Aggregate EMV of all identified risks and contingency reserve adequacy (Correct answer)
- Names of all risk owners on the team
- Date of the last risk review meeting
Correct answer: Aggregate EMV of all identified risks and contingency reserve adequacy
Aggregate EMV combined with contingency reserve status gives leadership a quantified, actionable view of the project's overall risk exposure.
GCP Risk Assessment & Management 5
A project team uses a decision tree to evaluate two alternative approaches.
Decision trees are PRIMARILY used to: