Project Risk Management Project Risk Management 4 — Questions and Answers
Question 1: Which document outlines how risk management activities will be structured and performed throughout the project?
- Risk register
- Risk report
- Risk management plan (Correct answer)
- Issue log
Correct answer: Risk management plan
The risk management plan defines the methodology, roles, timing, and categories for managing risk on the project.
Question 2: Expected Monetary Value (EMV) is calculated by:
- Multiplying probability by impact cost (Correct answer)
- Adding probability and impact
- Dividing impact by probability
- Subtracting residual risk from contingency
Correct answer: Multiplying probability by impact cost
EMV = Probability × Impact, providing a weighted average outcome value used in decision tree analysis.
Question 3: A project manager exploits an opportunity by ensuring the positive event definitely occurs. This maps to which response strategy?
- Share
- Enhance
- Exploit (Correct answer)
- Accept
Correct answer: Exploit
Exploit removes uncertainty from an opportunity by making it certain to happen, often by assigning more resources.
Question 4: Which type of risk analysis uses numerical methods such as Monte Carlo simulation?
- Qualitative risk analysis
- Quantitative risk analysis (Correct answer)
- Root cause analysis
- Risk categorization
Correct answer: Quantitative risk analysis
Quantitative risk analysis uses statistical modeling to numerically assess the impact of risks on project objectives.
Question 5: Risk owners are assigned during which process?
- Identify Risks
- Perform Qualitative Risk Analysis
- Plan Risk Responses (Correct answer)
- Monitor Risks
Correct answer: Plan Risk Responses
Risk owners are designated in the Plan Risk Responses process to ensure accountability for each risk response.
Question 6: A tornado diagram is used to display the results of which analysis technique?
- Monte Carlo simulation
- Sensitivity analysis (Correct answer)
- Decision tree analysis
- Expected Monetary Value
Correct answer: Sensitivity analysis
Tornado diagrams rank variables by their impact on the project outcome, with the largest bars at the top.
Question 7: Which of the following is an example of a risk trigger?
- The risk response plan is documented
- A vendor misses two consecutive milestone deadlines (Correct answer)
- The risk owner is assigned
- Contingency reserve is approved
Correct answer: A vendor misses two consecutive milestone deadlines
Triggers are early warning signs indicating a risk event is about to occur or has occurred, prompting a planned response.
Project Risk Management Project Risk Management 4
Which document outlines how risk management activities will be structured and performed throughout the project?