PM - Ch. 11

____ is the product of a risk event probability and the risk event's monetary value.

EMV

Which analysis technique simulates a model's outcome many times to provide a statistical distribution of the calculated results?

Monte Carlo

_____ is a technique by which a group attempts to generate ideas or find a solution for a specific problem by amassing ideas spontaneously and without judgment.

brainstorming

What is the first step in a Monte Carlo analysis?

collect the most likely, optimistic, and pessimistic estimates for the variable in the model

_____ are predefined actions that the project team will take if an identified risk event occurs.

contingency plans

____ are funds included in the cost baseline that can be used to mitigate cost or schedule overruns if known risks occur.

contingency reserves

Which diagramming technique is used to help select the best course of action in situations in which future outcomes are uncertain?

decision tree

The basic concept of the _____ technique is to derive a consensus among a panel of experts who make predictions about future developments.

delphi

Brainstorming is a systematic, interactive forecasting procedure based on independent and anonymous input regarding future events.

false

Risk events refer to specific, certain events that may occur to the detriment or enhancement of the project.

false

The last step in project risk management is deciding how to address the knowledge area for a particular project by performing risk management planning.

false

The psychology literature shows that individuals, working alone, produce fewer ideas than the same individuals produce through brainstorming in small, face-to-face groups.

false

Top Ten Risk Item Tracking is a quantitative risk analysis tool.

false

Unknown risks can be managed proactively.

false

the lower the earned monetary value calculation for a project, the chances of project success is higher.

false

One main output of the _____ process is a risk register.

identifying risks

The main outputs of which process include a risk register, risk report, and project documents updates?

identifying risks

Which process involves determining what risks are likely to affect a project and documenting the characteristics of each?

identifying risks

_____ is the process of understanding what potential events might hurt or enhance a particular project.

identifying risks

Which is a fact-finding technique that can be used for collecting information in face-to-face, phone, e-mail, or instant-messaging discussions?

interviewing

The term _____ is used to describe risks that the project team has identified and analyzed.

known risks

Risk _____ refers to reducing the impact of a risk event by reducing the probability of its occurrence.

mitigation

Which process involves monitoring identified and residual risks, identifying new risks, carrying out risk response plans, and evaluating the effectiveness of risk strategies throughout the life of the project?

monitoring risk

Potential problems that might occur on the project and how they might impede project success are _____ risks.

negative

Which process involves numerically estimating the effects of risks on project objectives?

performing qualitative risk analysis

Which process involves prioritizing risks based on their probability and impact of occurrence?

performing qualitative risk analysis

Which process involves prioritizing risks based on their probability of occurrence and impact?

performing qualitative risk analysis

Identifying risks is a subprocess of the _____ process of project risk management.

planning

What process involves deciding how to approach and plan the risk management activities for the project?

planning risk management

Which process involves taking steps to enhance opportunities and reduce threats to meeting project objectives?

planning risk responses

the _____ lists the relative probability of a risk occurring and the relative impact of the risk occurring.

probability/impact matrix

Unenforceable conditions or contract clauses and adversarial relations are risk conditions associated with the project _____ management knowledge area.

procurement

_____ risks are risks that remain after all of the response strategies have been implemented.

residual

A project _____ is an uncertainty that can have a negative or positive effect on meeting project objectives.

risk

Which action applies to positive risks when the project team cannot or chooses not to take any actions toward a risk?

risk acceptance

_____ involves accepting the consequences should a risk occur

risk acceptance

Which action involves eliminating a specific threat, usually by eliminating its causes?

risk avoidance

A(n) _____ is a hierarchy of potential risk categories for a project.

risk breakdown structure

Which action involves changing the size of the opportunity by identifying and maximizing key drivers of the positive risk?

risk enhancement

Which action involves doing whatever you can to make sure the positive risk happens?

risk exploitation

____ are numbers that represent the overall risk of specific events, based on their probability of occurring and the consequences to the project if they do occur.

risk factors

A(n) _____ documents the procedures for managing risk throughout the project.

risk management plan

Which action involves reducing the impact of a risk event by reducing the probability of its occurrence?

risk mitigation

The _____ is the person who will own or take responsibility for the risk.

risk owner

A(n) _____ is a document that contains results of various risk management processes.

risk register

The main output of qualitative risk analysis is updating the _____.

risk register

Which document contains results of various risk management processes; it is often displayed in a table or spreadsheet format?

risk register

Which action involves allocating ownership of the risk to another party?

risk sharing

Which action involves shifting the consequence of a risk and responsibility for its management to a third party?

risk transference

_____ is the amount of satisfaction or pleasure received from a potential payoff.

risk utility

Risk utility rises at a decreasing rate for a _____ person.

risk-averse

Risk utility rises at a decreasing rate for a(n) _____ person.

risk-averse

Which type of person achieves a balance between risk and payoff?

risk-neutral

Those who are _____ have a higher tolerance for risk, and their satisfaction increases when more payoff is at stake.

risk-seeking

Which risks are direct results of implementing risk responses?

secondary

Which technique is used to show the effects of changing one or more variables on an outcome?

sensitivity analysis

____ helps professionals to see the effects of changing one or more variables on an outcome

sensitivity analysis

_____ is a qualitative risk analysis tool that maintains an awareness of risks throughout the life of a project in addition to identifying risks.

top ten risk item tracking

_____ are indicators or symptoms of actual risk events.

triggers

A probability/impact matrix or chart lists the relative probability of a risk occurring on one side of a matrix or axis on a chart and the relative impact of the risk occurring on the other.

true

A risk-seeking person prefers outcomes that are more uncertain and is often willing to pay a penalty to take risks.

true

Contingency plans are predefined actions that the project team will take if an identified risk event occurs.

true

Identified risks may not materialize, or their probabilities of occurrence or loss may diminish.

true

Large, complex projects involving leading-edge technologies often require extensive quantitative risk analysis.

true

One possible response to managing negative risk it to accept the potential effects from the risk.

true

Risks can have both negative and positive effects on meeting project objectives.

true

The Delphi technique is a systematic, interactive forecasting procedure based on independent and anonymous input regarding future events.

true

The Monte Carlo analysis can predict the probability of finishing by a certain date or the probability that the cost will be equal to or less than a certain value.

true

The main output of qualitative risk analysis is updating the risk register.

true

The risk register can be created with a simple Microsoft Word or Excel file.

true

A(n) _____ is a list of risks that are low priority, but are still identified as potential risks.

watch list

Project teams sometimes use _____, which are unplanned responses to risk events, when they do not have contingency plans in place.

workarounds

_____ are unplanned responses to risk events used when project teams do not have contingency plans in place.

workarounds