PMP Exam Chapter 11 Risk Management
10. Which of the following is a tool or technique used in the monitor risks process? A. audits B. Interpersonal and team skills C. Expert judgment D. Decision making
A. audits p. 396 - The tools and techniques used in the monitor risks process include: Data analysis Audits Meetings
21. It is very important that the project manager determine risk tolerances in order to help: A. The sponsor understand how the resource managers will act. B. Schedule the project. C. Rank the project risks. D. Estimate the project duration.
C. Rank the project risks Risk tolerances, or how much risk various stakeholders are willing to accept. This is a critical piece of information used to rank the project risks.
36. You are the project manager on a multi-year facilities development project. Significant spring rains caused major flooding that caused power outages and the loss of all project records not stored on your laptop. What should have been done to prevent this problem? A. Approve a larger contingency reserve. B. Plan for a larger management reserve. C. Maintain the records outside a flood plain. D. Monitor the weather and have a contingency plan.
D. Monitor the weather and have a contingency plan. With the information provided you do not know what the best solution would have been. The only thing you can say for sure is that you should have had a contingency plan—oh, and watching the weather probably wasn't a bad idea either...
47. From which of the following processes would you expect to generate a watch list? A. Plan risk management B. Identify risks C. Perform qualitative risk analysis D. Plan risk responses
C. Perform qualitative risk analysis A watch list is made up of low priority risks that, in the perform qualitative risk analysis process, were determined to be too low priority or low impact to move further in the risk process.
20. Which of the following is not always an input to the risk management process? A. Work breakdown structure B. Lessons learned C. Project status reports D. Historical information
C. Project status reports Although project status reports can be a vital input to the risk management process, they are usually not available during the risk planning process and are therefore not always an input to the risk management process.
52. You have just completed the determination of probability and impact of your defined project risks. You have also analyzed the assumptions and are ready to move on to the next step of risk management, but based upon the information what have you forgotten to do? A. Identify triggers. B. Evaluate trends in the risk analysis. C. Create a fallback plan. D. Provide a standardized risk rating matrix.
D. Provide a standardized risk rating matrix. In this case you are in the Perform Qualitative Risk Analysis process. There are two key activities in this process: assumption testing and probability and impact matrix development. The matrix is missing. All the other options will occur later in risk management.
50. You are struggling to evaluate the exact cost impact of risks on your project. You would be advised to evaluate on a: A. Qualitative basis B. Quantitative basis C. Numeric basis D. Cost basis
A. Qualitative basis If you cannot determine the exact costs of a risk you should use qualitative estimates such as low, medium and high.
37. You have been asked to lead a mission-critical project for your organization. The project is very large, will take approximately 3 years, and will be highly visible to the senior leadership of the organization. Unfortunately, your company does not have a very good track record at handling risks and rarely seems to follow its risk management policies and procedures. You have less than a month until your first major milestone. If senior management is expecting to see an analysis of the project's risks and response strategies which of the following groups or individuals is least important? A. The sponsor. B. The project team members. C. The individuals responsible for the risk policies and procedures. D. Key stakeholders.
A. The sponsor. Although sponsors are often involved in the identification of risks, they are usually not as involved in the development of response plans. All the other answers are key resources in the development of response plans.
17. You have been asked to select one of four projects for your organization to execute. The organization is very risk adverse. If you assume the ends of a range of estimates are +/- 3 sigma from the mean, which of the following range estimates involves the least risk? A. Optimistic = 21 days, most likely 27 days, pessimistic = 32 days. B. 26 days plus or minus 5 days. C. 20 - 33 days. D. Mean of 26 days.
B. 26 days plus or minus 5 days This question is actually much easier than it first appears. Because we are assuming a range of estimates that is +/- 3 sigma, meaning it is a normal distribution, all you have to do is determine which range estimate has the smallest difference or variance. The 3 point estimate has a range of 11 days. The plus or minus 5 days is a range of 10 and 20-33 days is 13.
32. You apply for a job with a large consulting company. As part of the interview process you are provided with a sample project charter and asked to provide an analysis of the project risks. Which of the following would best help you complete the exercise? A. The PMBOK® Guide. B. A discussion with several team members within the organization from a similar project that failed in the past. C. The scope statement from the project planning process. D. The resource plan from the project planning process.
B. A discussion with several team members within the organization from a similar project that failed in the past. This question centers on imagining where you are in the project. The question gives you a charter and nothing else. Therefore, you must assume you are in the initiating process. Two of the other choices say they are from the planning process and therefore not available. The PMBOK® Guide is a nice framework, bur remember PMI® suggests the situation is critical.
55. You are leading a large, multi-year engineering project designed to impact multiple locations within your company. A tornado destroys the headquarters location and all the project records including all project reporting and historical information with no way of recovering the information. What should have been done to prevent this problem? A. Purchase insurance. B. Monitor the weather and have a contingency plan. C. Plan a reserve fund. D. Schedule the installation outside of tornado season.
B. Monitor the weather and have a contingency plan. The risk is the loss of the data due to the weather. Purchasing insurance does nothing to mitigate the problem. Creating a reserve fund is a form of risk acceptance. Avoiding the tornado by scheduling the project when it wasn't tornado season could negatively impact the project. The best choice is to monitor the weather and know when to implement the contingency plan.
26. You have just determined that you need to transfer a risk. In which of the following risk management processes are you? A. Identify risks B. Plan risk responses C. Monitor and control risks D. Perform quantitative risk analysis
B. Plan risk responses Be careful here. The question states you have just determined that you NEED to transfer a risk. This is done in the plan risk response process.
24. It is your first day at a new job and you are asked to evaluate the risks on a large project managed by the PMO. Unfortunately, you cannot evaluate the exact cost impacts of the risks you are analyzing. Based on this situation you should evaluate the risks on a: A. Statistical basis B. Qualitative basis C. Quantitative basis D. Mathematical basis
B. Qualitative basis The question tells you that you cannot find the exact impacts. This excludes statistical, quantitative and mathematical basis of measure. You are left with qualitative such as high, medium and low.
44. Which of the following best describes a heuristic? A. An advanced statistical calculation used to model risks. B. A simulation used to model risks. C. A rule of thumb. D. A calculation used to produce a weighted measure of risk.
C. A rule of thumb. A heuristic is simply a rule of thumb. There is no calculations involved.
27. You are acting as the project manager for a large project $1,500,000 within your organization. You have just finished the risk response plan for your project. Which of the following should you probably do next? A. Begin a project risk reassessment. B. Begin to analyze the risks that appear in major project documents. C. Complete the work breakdown structure. D. Determine the overall risk rating for the project.
C. Complete the work breakdown structure. Finishing the risk response plan is done in the planning process group. The only of the options that is also in the planning process group is the completion of the work breakdown structure.
18. Which of the following is not a factor in the assessment of project risk? A. Transference costs B. Risk probability C. Value at stake D. Risk event
A. Transference costs "Transference costs" is a fancy way of saying insurance premiums. These do not come into play until you are evaluating the risk responses.
11. Which of the following is NOT a tool or technique used in the implement risk responses process? A. Expert judgment B. Interpersonal and team skills C. Technical performance measurements D. Project management information system
C. Technical performance measurements p. 396 - The tools and techniques used in the implement risk responses process include: Expert judgment Interpersonal and team skills Project management information system
1. You are asked to choose between two projects, A or B, based on the highest gain (or the lowest loss). Project A will cost $650,000 and B will cost $467,000. There is a 56% chance that project A will be successful, which will result in a gain of $1,800,000. If project A fails there will be a loss of $900,000. There is a 67% chance project B will be successful, and that will result in a $950,000 gain. If Project B fails there will be a loss of $670,000. Based on this information, what is the value of the best alternative? A. $-38,000 B. $38,000 C. $-51,600 D. $51,600
A. $-38,000 To answer this question you must calculate the expected monetary value of each choice using the decision tree model found in your LGd training guide and then compare the options. Whichever option has the greatest value is the one you should choose. Decision Trees Prob P/L Net Out Total 56% 1,800K 1,150K 644K (650K) (38K) 44% (900K) (1,550K) (682K) 67% 950K 483K 323K (467K) (51K) 33% (670K) (1,137K) 375K
1. You have been asked to establish an estimated project cost using Expected Monetary Value (EMV). If the project has a best case estimate of $10,000 with a probability of 20%, a most likely case estimate of $12,000 with a probability of 50%, and a worst case estimate of $14,400 with a probability of 30% what is the EMV for the project? A. $12,320 B. $12,400 C. $13,010 D. $13,260
A. $12,320 Expected Monetary Value The formula to get the correct answer is: ($10,000 * 20%) + ($12,000 * 50%) + ($14,400 * 30%) = $12,320
14. You are leading a large complex project within your organization that is forecast to continue for ten more months. The project has an 18% chance of being impacted in a given month by a particular risk. What is the probability that the project will be impacted by the risk in the 3rd month? A. 18% B. 36% C. 54% D. 72%
A. 18% Many people miss this question. Remember, each month in the scenario is independent. So if the probability is 18% in one month and the probability is equal, it is 18% in all months.
54. Your team has come up with 521 risks and 42 major causes of those risks. Your team has worked on several projects together and your project sponsor is both influential and supportive. You and your team have invested significant time to make sure the project work was completed and signed off by all key stakeholders. However, during the planning phase, the team was unable to come up with an effective way to mitigate or ensure against a particular risk. The work cannot be outsourced or deleted from the project. Which of the following represents the best solution? A. Accept the risk. B. Look foterm-56r ways to transfer the risk. C. Look for ways to avoid the risk. D. Continue to look for ways to mitigate the risk.
A. Accept the risk. Most of this question is useless. You cannot remove the work nor can you insure or outsource it to transfer the risk. The only option left is acceptance.
39. Which of the following is a primary characteristic of the Delphi Technique? A. Expert opinion. B. Simulation modeling in a hierarchical process. C. Use of heuristic analysis. D. Extrapolation from historical documents.
A. Expert opinion. The Delphi Technique is a process where you survey your subject matter expert, aggregate their responses, and then feed back the aggregation for confirmation.
45. Monte Carlo analysis is used to: A. Get an indication of the risk involved in a project. B. Simulate the order in which activities occur. C. Estimate an activity's length. D. Measure project risk level.
A. Get an indication of the risk involved in a project. Several of these answers are partially correct. The Monte Carlo Analysis could help you know that an activity needs to change, but not what the estimate should be. The Monte Carlo analysis is a simulation tool, but it typically is used to simulate time or cost and not ordering of the activities. It can also be used to measure the probabilities of risk or the likelihood of being on the critical path. However, the best answer is getting an overall analysis of the project risk.
30. You are the project manager on a large IT project. You have assembled your team, identified the major risks on the project, determined what would trigger those risks, rated the risks on a rating matrix, tested the major risk assumptions, and assessed the quality of the data used. The team is continuing to move through the risk management process. What have you forgotten to do? A. Involve other stakeholders. B. Use a Monte Carlo simulation. C. Mitigate the risks. D. The overall risk ranking for the project.
A. Involve other stakeholders. There is nothing wrong with this process. It simply needs to be continued. The best answer in this case is to involve other stakeholders
28. You are in the process of quantifying risks on a project you are leading. Several of your key resources are non-collocated and have needed input. How can this be done? A. Make use of the Delphi technique. B. Make use of Monte Carlo analysis. C. Make use collaboration software. D. Apply critical chain modeling.
A. Make use of the Delphi technique. The Delphi Technique is specifically designed to survey your experts, aggregate their responses and then feed the aggregated result back to them for confirmation. This is the best option in a situation where the resources are not all together.
25. In which of the following risk management processes are you most likely to be required to find workarounds? A. Monitor risks B. Plan risk responses C. Identify risks D. Quantitative risk analysis
A. Monitor risks Workarounds—by definition—are responses created for risks not included in the risk register.
1 Which of the following is an input to the identify risks process? A. Project management plan B. SWOT analysis C. Risk related contracts D. Technical performance measurements
A. Project management plan p. 396 - The inputs to the identify risks process includes: Project management plan Project documents Agreements Procurement documentation Enterprise environmental factors Organizational process assets
49. Which of the following is not always an input to the risk management process? A. Project status reports B. Historical information C. Lessons learned D. The work breakdown structure
A. Project status reports Although project status reports can be an important input to the risk management process, when you are first completing the process you likely will not have any status reports yet.
5. Which of the following is NOT a tool or technique used in the perform quantitative risk analysis process? A. Prompt lists B. Representations of uncertainty C. Interpersonal and team skills D. Expert judgment
A. Prompt lists p. 396 - The tools and techniques used in the perform quantitative risk analysis process include: Expert judgment Data gathering Interpersonal and team skills Representations of uncertainty Data analysis
6. Which of the following is a tool or technique used in the perform quantitative risk analysis process? A. Representations of uncertainty B. Risk categorization C. Meetings D. Project management information system
A. Representations of uncertainty p. 396 - The tools and techniques used in the perform quantitative risk analysis process include: Expert judgment Data gathering Interpersonal and team skills Representations of uncertainty Data analysis
9. Which of the following is NOT an tool and technique to the monitor risks process? A. Risk urgency assessment B. Risk audits C. Status meetings D. Technical performance measurement
A. Risk urgency assessment p. 396 - The tools and techniques used in the monitor risks process include:
34. You are leading a project that has an SPI of 0.69 and a CPI of .71. The project has more than 1,000 work packages, and it is being completed over three years. The team has not worked together before, and the project has not been well supported. Which of the following is the best thing to do? A. Update the risk register with any new risks and analysis. B. Examine the WBS for unnecessary work packages. C. Examine the RAM for necessary changes. D. Examine the budget for necessary changes.
A. Update the risk register with any new risks and analysis. To answer this question correctly you had to notice the project is already significantly over budget and behind schedule. Changing the WBS, RAM, or budget should only happen in response to risks that occur. So you should start there.
51. You have just finished the risk response plan for your US $250,000 information technology project. Which of the following should you probably do next? A. Determine the overall risk rating for the project. B. Add needed work packages to the work breakdown structure. C. Hold a project risk reassessment. D. Begin to analyze the risks that appeared in the technical design.
B. Add needed work packages to the work breakdown structure. Based upon the description, this situation is in the planning process group. You must complete the planning before moving on. The only process in planning is adding work packages to the WBS.
19. You take over a project from a previous project manager. As part of the turn over process they hand you a risk watch list. What should be done with the risks on the watch list? A. Add the information to your takeover report. B. Add them to the lessons learned for future projects. C. Read over the watch list as they are already covered in the properly completed contingency plans. D. Read over the watch list then revisit during monitoring and controlling.
B. Add them to the lessons learned for future projects A good project manager is constantly monitoring the identified risks on a project. In this question you do not know where the watch list came from.
4. Which of the following is NOT an input to the perform quantitative risk analysis process? A. Organizational process assets B. Agreements C. Project management plan D. Project documents
B. Agreements p. 396 - The inputs to the perform quantitative risk analysis process include: Risk management plan Cost management plan Schedule Management Plan Risk register Enterprise environmental factors Organizational process assets
42. You are leading a research and development project. You are in the executing process group when one of your senior resources identifies a risk that is not listed in the risk register. What should you do? A. Determine how the team member identified the risk. B. Analyze the risk. C. Inform the sponsor and key stakeholders of the risk. D. Place the risk in the risk register.
B. Analyze the risk. The first thing you always do is analyze the risk. Only then can you determine what should be done next.
15. You are acting as an outside project management expert consultant for a struggling project. The project is important to the chief executive officer who is concerned the project is not going to hit its schedule date. Which of the following is most likely to impact achieving the schedule target? A. Significant increases in component costs. B. Delays in obtaining required sponsor approvals. C. Date slippages as stakeholders fail to attend sprint reviews. D. Disputes with contractors over increase costs.
B. Delays in obtaining required sponsor approvals. Only delays in obtaining sponsor approvals are guaranteed to cause delays. The other alternatives might cause a delay (except the postimplementation review meeting).
31. You have worked with different stakeholders to determine the probability and impact of a project's risks. You have also analyzed the assumptions. Before you move on to the next step in the risk management process, what do you need to do? A. Identify and evaluate triggers. B. Develop your risk rating matrix. C. Evaluate the trends in risk analysis. D. Create a contingency plan.
B. Develop your risk rating matrix. Before you can move on to the next step in the process you need a definition for how you will be rating the risks.
46. You are working with your team to complete the risk response plan. However, every time the team develops a risk response, another risk is identified as being caused by the suggested response. Which of the following is the best thing for the project manager to do? A. Return to the identify risks process as something is amiss. B. Document the new risks and continue the plan risk responses process. C. Return to the define scope process to determine what is missing. D. Get more stakeholders involved in the identify risks process as so many were missed.
B. Document the new risks and continue the plan risk responses process. Don't get misled by the fact that the process generated so many new risks. The key is that you follow your process. In this case it is working as it should. You should expect the identify risk responses process to generate new risks.
58. You are leading a multi-year project that is almost complete. You have five deliverables left and have used up almost all the reserves. You sponsor informs you that the project must be completed two weeks earlier than previously forecasted. In response you send out an RFP to several potential vendors to outsource three of the remaining deliverables. This is an example of the project manager attempting to work with what? A. Reserves B. Opportunities C. Threats D. Strengths
B. Opportunities The ability to potentially outsource some of the deliverables is an example of taking advantage of an opportunity.
43. You are taking over a $50,000 IT project for your organization. The project is entering its third phase. Although there appear to be many risks on the project, no one has evaluated them to assess the range of possible impacts. What needs to be done? A. Perform qualitative risk analysis B. Plan risk management C. Plan risk responses D. Monitor risks
B. Plan risk management The project has started, and it should complete the risk management process. That process begins by planning risk management. Since that step has not already occurred it needs to be completed first.
12. Which of the following is a tool or technique used in the implement risk responses process? A. Data gathering and representation techniques B. Project management information systems C. Risk data quality assessment D. Planning meetings and analysis
B. Project management information systems PMBOK® Guide - The tools and techniques used in the implement risk responses process include: Expert judgment Interpersonal and team skills Project management information system
22. Which of the following is not a common result of risk management? A. The communications management plan is changed. B. The project charter is changed. C. The schedule management plan is changed. D. The project management plan is changed.
B. The project charter is changed. Of the choices the project charter is the least likely to be changed because of the risk management process. Remember, the charter authorizes the project.
40. You are leading a large IT project that is nearing completion. Your sponsor requests a change to the project that would increase the project risk. What should you do first? A. Update the risk register. B. Gain an understanding of why the sponsor wants the change. C. Analyze the impacts of making the change with the project team. D. Calculated the EMV of the risk and create a new cost estimate.
C. Analyze the impacts of making the change with the project team. According to PMI®, the first thing you must do in any situation is understand the impacts. Only then can you devise the correct response.
56. During the project execution phase of a project you are leading one of your subject matter experts identifies a risk that is not in the risk register. What should you do? A. Disregard the risk because it was not identified in risk identification. B. Inform the sponsor of the risk. C. Analyze the risk. D. Discuss with the resource how they identified the risk to ensure others were not missed.
C. Analyze the risk. This is another example of those "what would you do first?" questions. As always, the right answer is analyze the situation.
7. Which of the following is a tool or technique used in the plan risk responses process? A. Risk response analysis B. Risk response planning C. Contingent response strategies D. Strategic risk response planning
C. Contingent response strategies p. 396 - The tools and techniques used in the plan risk responses process include: Expert judgment Data gathering Interpersonal and team skills Strategies for negative risks or threats Strategies for positive risks or opportunities Contingent response strategies Strategies for overall project risks Data analysis Decision making
33. You are working as a project manager on a large new product development project. While preparing your risk responses your team identifies additional risks. What should you do? A. Get management to allocate another 5% to the project budget to cover the risks. B. Determine the risk events and the associated cost, then add the cost to the project budget as a reserve. C. Document the risks, and calculate the expected monetary value based on the PI score that result from the risk occurrence. D. Add reserves to the project to accommodate the new risks and notify management.
C. Document the risks, and calculate the expected monetary value based on the PI score that result from the risk occurrence. Before you can determine the appropriate response you have to determine the value or cost of the risk as well as the impacts. Only then can you determine if you or management needs to add reserves or another response is needed.
13. You are acting as the portfolio manager and must select a project to execute from a pool of three choices. Each of the choices has an expected payout of $20,000 and an equal 75% chance of succeeding. In this situation what does $15,000 represent? A. Net present value B. Risk value C. Expected monetary value D. Simple interest
C. Expected monetary value The expected monetary value is calculated by multiplying the probability times the impact of any event.
57. Which of the following is a chief characteristic of the Delphi Technique? A. A bottoms up approach B. Analytical heuristic analysis C. Expert opinion D. Extrapolation from historical records of previous projects
C. Expert opinion The Delphi Technique uses expert judgment to build a consensus opinion. The expert judgment is its key feature.
53. As the project manager you have assembled your team and identified more than 100 risks on your project. You and the team have rated them on a risk rating matrix, tested their assumptions, and assessed the quality of the data used. The team is continuing to move through the risk management process, but what have you forgotten to do? A. Risk mitigation. B. Overall risk ranking for the project. C. Involve other stakeholders. D. Monte Carlo analysis.
C. Involve other stakeholders. You might look at this question as a trick of sorts. The process described is fine. The only issue is you have not involved other stakeholders to identify more risks.
59. During the identify risks process, a project manager made a long list of risks identified by all the stakeholders using various methods. She then made sure all the risks were understood and that triggers had been identified. Later, in the plan risk responses process, she took all the risks that had been identified and determined ways to mitigate them. What has she done wrong? A. The project manager should have waited until the perform qualitative risk analysis process to get the stakeholders involved. B. The project manager should have created workarounds. C. More people should be involved in the plan risk response process. D. Triggers are not identified until the identify risks process.
C. More people should be involved in the plan risk response process. The plan risk responses processes should include the involvement of all the risk response owners and possibly other stakeholders.
38. You are leading a high technology product development project that was originally scheduled to take 18 months. The project has faced significant problems and has had to use all its reserves. You currently have an SPI of 0.68 and a CPI of 0.73. There are only six deliverables left and three of them are on the critical path. The project sponsor has just told you that you only have four weeks to finish the project or risk losing all funding and support. This is three weeks faster than your current ETC. In response, you send out an RFP to four vendors for some of the work that the internal team was going to perform hoping an external organization could get the work done faster. This can best be described as an effort on the part of the project manager to work with: A. Contingencies B. Threats C. Opportunities D. Reserves
C. Opportunities This is a bad situation, but that does not impact the answer. Only the last three sentences matter. You are trying to gain an opportunity to do the project more quickly.
2. Which of the following is NOT a tool or technique used in the identify risks process? A. Data gathering B. Data analysis C. Risk categorization D. Prompt list
C. Risk categorization p. 396 - The tools and techniques of the identify risks process include: Expert judgment Data gathering Data analysis Interpersonal and team skills Prompt lists Meetings
23. Which of the following risk strategies is represented by insurance? A. Avoidance B. Acceptance C. Transfer D. Mitigation
C. Transfer Insurance is the most common type of risk transfer. It is making the risk someone else's problem.
29. During the plan risk management process the project team you are leading discovers 387 risks and 32 major causes of those risks. The project is part of a major program within the organization and must be completed. Your team is very experienced and has worked together for several years. You have also worked with the sponsor for several years as well, and they are very supportive of your efforts. Significant time has been spent to ensure the project scope and WBS is complete and it has been signed off by all the key stakeholders. Unfortunately, your team has not been able to determine an effective way to mitigate or insure against the one of those major risks. It is something that must be done by the internal team and cannot be outsourced. It also cannot be deleted from the project. What would be the best solution? A. Determine a way to transfer the risk B. Determine a way to avoid the risk C. Continue to investigate ways to mitigate the risk D. Accept the risk
D. Accept the risk There are two important aspects to this question. Firstly, did you notice that everything but the last four sentences is unnecessary? Secondly, this question really reflects the real world. The question excludes everything but acceptance. Sometimes in the real world all you can do is accept a risk.
8. Which of the following is NOT a tool or technique used in the plan risk response process? A. Strategies for negative risks or threats B. Strategies for positive risks or opportunities C. Expert judgment D. Contingency reserve analysis
D. Contingency reserve analysis p. 396 - The tools and techniques used in the plan risk responses process include: Expert judgment Data gathering Interpersonal and team skills Strategies for negative risks or threats Strategies for positive risks or opportunities Contingent response strategies Strategies for overall project risks Data analysis Decision making
41. You are leading a major construction project. During project execution a major problem occurs that does not appear in the risk register. What should you do first? A. Inform the project stakeholders. B. Look for secondary risks. C. Exam the identify risks process for flaws. D. Create a workaround.
D. Create a workaround. This is a risk that has already happened. The first thing you need to do is deal with the problem and then take the workaround to the sponsor and key stakeholders.
48. Which of the following must be an agenda item at all team meetings? A. Review of project issues B. Identification of new assignments C. Status of all activities D. Discussion of project risks
D. Discussion of project risks According to PMI®, risks are a critical area that impacts all other areas of project management. It is so important it should be discussed at every meeting.
16. You have been asked to select one of four projects for your organization to execute. The organization is very risk adverse. If you assume the ends of a range of estimates are +/- 3 sigma from the mean, which of the following range estimates involves the least risk? A. Mean of 33 days. B. 40 days plus or minus 8 days. C. 32 - 46 days. D. Optimistic = 33 days, most likely 40 days, pessimistic 46 days.
D. Optimistic = 33 days, most likely 40 days, pessimistic 46 days. This question is actually much easier than it first appears. Because we are assuming a range of estimates that is +/- 3 sigma, meaning it is a normal distribution, all you have to do is determine which range estimate has the smallest difference or variance. The 3 point estimate has a range of 13, the 33-46 days is a range of 13, and 40 +/- 8 days is 16.
35. Your project is very close to completion when an unidentified risk occurs. This risk could affect the project's overall ability to deliver. What should you do first? A. Develop a risk response plan. B. Develop a workaround. C. Alert the project sponsor to the potential impacts to the schedule, costs, and scope of the project. D. Qualify the risk.
D. Qualify the risk. The first thing you always do is analyze the situation and develop alternatives. Only then do you proceed.
3. Which of the following is a tool or technique used in the perform qualitative risk analysis process? A. Risk response analysis B. Risk prioritization C. Project management information system D. Risk categorization
D. Risk categorization p. 396 - The tools and techniques used in the perform qualitative risk analysis include: Expert judgment Data gathering Data analysis Interpersonal and team skills Risk categorization Data representation Meetings
