Project Management IQ - Risk

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5-A001 - The requirements and functional specifications have been completed and the acceptance test strategy is now in development. At what point in the project should the project manager plan for events not happening in accordance with the project plan?

When the unanticipated events occur, because this approach saves you valuable timeA)Contingency planning should occur throughout the project life cycleB)Only during the development of the risk management planC)Contingency planning occurs mainly in the Design PhaseD)

References: \Kerzner (7th Edition) p. 913

5-A002 - When a project manager examines data that indicates there may be a problem or a conflict on the project, which of the following questions and the subsequent answers should she not evaluate?

Is the information pertinent?A)Is the information current and complete?B)Should she tell the project sponsor about the problem or concern?C)If the information is true, what are the implications for the project?D)

References: \Kerzner (7th Edition) pp. 915-918 \PMBOK(r) Guide p. 131

5-A003 - When evaluating the possible solutions and tradeoffs to resolve a project conflict, the project manager should:

Consider only lessons learned from previous projectsA)Ignore the potential of compromising the sponsor's objectives, and corporate strategic planB)Fully consider possible impact on schedule, cost, risk, and performanceC)Consider only the effect on resources consumed and projected resource consumption for that projectD)

References: \Kerzner (7th Edition) pp. 915-916

5-A004 - Risk can have a positive or negative impact on a project. Future events or outcomes that are favorable are called:

RisksA)OpportunitiesB)BenefitsC)ContingenciesD)


5-A005 - Future risk events or outcomes that are unfavorable are called:

RisksA)OpportunitiesB)LossesC)ContingenciesD)

References: \Kerzner (7th Edition) p. 905-906 \PMBOK(r) Guide p. 127

5-A006 - The cause of a risk event can be referred to as a (an):

OpportunityA)ProbabilityB)ContingencyC)HazardD)


5-A007 - When the project team is carrying out risk management activities, the project manager facilitates decision-making that is influenced by the three broad categories of:

Certainty, risk, and uncertaintyA)Probability, risk, and uncertaintyB)Probability, risk event, and uncertaintyC)Hazard, risk event, and uncertaintyD)


5-A008 - The iterative process that helps determine those risks that might affect the project and documenting their characteristics is known as:

Risk identificationA)Risk-handlingB)Lessons learnedC)Risk analysisD)

References: \PMBOK(r) Guide p. 131

5-A009 - The process of conducting an analysis to determine the probability of risk events and the consequences associated with their occurrence is known as:

Risk assessmentA)Risk-handlingB)Lessons learnedC)Risk quantificationD)


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5-A010 - The techniques and methods used to reduce or control risk are part of which of the following mechanisms:

Risk assessmentA)Risk response planningB)Lessons learnedC)Risk analysisD)


5-A011 - Joan was developing a test scenario for her project when she determined the project target date to be at risk. She adjudged this to be a medium risk, based upon her experience with these tests in the past. From her assessment, this would be translated into a __________% probability that this risk event will occur.

60A)40B)50C)Not determinable from the above informationD)


5-A012 - If a project manager has a very low tolerance for risk, he is said to be:

Risk averseA)Risk tolerantB)Risk reluctantC)MethodicalD)

References: \Anbari pp. 49-50

5-A013 - When changing the scope of a project to lower the associated risk, a project manager should not consider:

The interaction of the effects of the change on schedule, cost, and qualityA)The introduction of new risk events due to the scope changeB)The quality of the resulting product or serviceC)The effect on the project manager's careerD)


5-A014 - The expected value of a risk event is calculated by multiplying the __________.

Likelihood of the event by the consequence of its occurrenceA)Likelihood of the event by the number of risk eventsB)The number of risk events by the consequences of their occurrenceC)The likelihood of the greatest risk event by the consequence of the smallest risk eventD)

References: \Kerzner (7th Edition) p. 905 \PMBOK(r) Guide p. 139

5-A015 - Which of the following is not directly a technique for reducing or controlling risk?

TransferA)AvoidanceB)Lessons learnedC)AssumptionD)

References: \Kerzner (7th Edition) pp. 934-935 \PMBOK(r) Guide p. 142-143

5-A016 - A project manager states, "I will share this risk with others or totally shift it to them." He/she is exercising the __________ method of risk reduction.

TransferA)AvoidanceB)MitigationC)AcceptanceD)


5-A017 - A project manager states, "I know that the risk exists and am aware of the possible consequences. I am willing to wait and see what happens. I accept the consequences should they occur." He/she is exercising the __________ method of risk reduction.

TransferA)AvoidanceB)MitigationC)AssumptionD)


5-A018 - A risk event has a very high probability of occurring, and the consequences, should the event occur, are catastrophic. Which strategy would most project managers not take, if all were available?

TransferA)AvoidanceB)MitigationC)AssumptionD)

References: \Kerzner (7th Edition) pp. 932-937 \PMBOK(r) Guide pp. 141-143

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5-A019 - If a risk event has a chance of occurring 15 times out of 45 times, based on experiences with like events, what is the probability that the event will occur on the next project?

90%A)45%B)15%C)33%D)

References: \Anbari p. 10

5-A020 - In what type of projects should the principles of risk management be applied?

Most projectsA)Only when the project is large and there is substantial uncertaintyB)Only when the project is large, there is substantial uncertainty, and the consequences of the risk occurring are substantialC)All projectsD)


5-A021 - The ultimate goal of applying the principles of risk management to a project is to:

Consider all project risksA)Significantly reduce or mitigate project risksB)Significantly reduce the cost of completing the projectC)Always reduce the time required to complete the projectD)


5-A022 - When the risk event probabilities are multiplied by their respective estimated risk event values (in dollars) and are then added together, the sum represents the:

Project manager's risk aversion quotientA)Total project risk eventsB)Expected monetary value of the project's riskC)Scope planningD)

References: \PMBOK(r) Guide pp. 137-139

5-A023 - Using the figure below, what is the probability that Project 1 will be selected and completed successfully?

50%A)30%B)60%C)40%D)


5-A024 - If the data resulting from an experiment is normally distributed, the resulting plot of the data will be:

Bell-shapedA)Skewed to the left of the meanB)Equally distributed around the medianC)Representative of the PERT calculation resultsD)

References: \Anbari p. 15

5-A025 - Project risk management can be defined as the process necessary to identify, analyze and respond to project risk events. This activity is sometimes defined as a function that is focused on reducing:

CertaintyA)DamageB)TimeC)CostD)

References: \Kerzner (7th Edition) pp. 905

5-A026 - When trying to manage and reduce the risks associated with a project, the risk events should be grouped by:

The effect that the risk event will have on the projectA)The impact of the risk event should it occurB)The source of the risk eventC)The project manager's tolerance for the risk eventD)


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5-A027 - Based on the data in the table below, which strategy has the highest expected value?

S1A)S2B)S3C)S4D)


5-A028 - Based on the data in the table below, which strategy has the highest expected value with no possibility of a loss?

S2A)S3B)S4C)S5D)


5-A029 - Based on the data in the table below, what is the expected value of strategy S3?

100A)75B)95C)160D)


5-A030 - Using the "maximax" or Hurwicz criteria (i.e., go for broke or risk-lover), which strategy in the table below should be selected?

S1A)S2B)S3C)S4D)


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5-A031 - If the minimum payoffs of four different strategies A1, A2, A3, and A4 are -10, -5, 0, and -20 respectively, which strategy would a project manager choose, using the "maximin" or Wald criteria (risk avoider)?

Strategy A1A)Strategy A2B)Strategy A3C)Strategy A4D)


5-A032 - Which of the following is not an approach that could be used for the identification of risks?

Delphi techniqueA)Project Plan/WBS decompositionB)Fishbone diagramsC)Quality MeasurementsD)

References: \Kerzner (7th Edition) pp. 915-918 \PMBOK(r) Guide p. 132-133

5-A033 - Which of the following is not an external, unpredictable risk?

Changes in government regulationsA)Natural disastersB)VandalismC)InflationD)


5-A034 - The ultimate purpose of project risk management is risk:

AnalysisA)HandlingB)AssessmentC)Contingency planningD)


5-A035 - A project manager states, "I will take the necessary measures required to control this risk by continuously reevaluating it and developing contingency plans or fall-back positions. If the risk event occurs, I will take the appropriate actions." He/she is exercising the __________ method of risk reduction.

TransferA)AvoidanceB)MitigationC)AcceptanceD)


5-A036 - A project manager typically deals with risk events that fall into which area of the certainty/uncertainty spectrum:

Complete certaintyA)Complete uncertaintyB)Relative uncertaintyC)Informational certaintyD)


5-A037 - During which phase of a project is the level of uncertainty the greatest?

DesignA)Development/ExecutionB)ConceptualC)Phase-outD)


5-A038 - What is the expected value of a project based on the following data?

$190,000A)$ 75,000B)$100,000C)$120,000D)


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5-A039 - Given the following possible profit and loss outcomes of a project, find the expected total profit or (loss):

($1,000)A)$1,000B)$2,000C)$1,200D)


5-A040 - Which of the following utility functions reflect risk aversion?

UniformA)Increasing rateB)Decreasing rateC)ExponentialD)

References: \Kerzner (7th Edition) pp. 906-907 \Anbari pp. 49-50

5-B001 - When developing a risk management plan, the project manager should be aware that risk:

Decreases with hazard and decreases with safeguardA)Increases with hazard but decreases with safeguardB)Increases with hazard and increases with safeguardC)Is not a function of either hazard or safeguardD)


5-B002 - Contingency plans are best if they are:

Based on the project manager's past experienceA)Produced in advance and available for use when a risk event occursB)Based on the project manager's aversion to riskC)Aligned with the project's objectivesD)


5-B003 - Project risk is typically characterized by which three factors?

Risk event, risk probability, and the expected value of the riskA)Severity of impact, duration of impact, and cost of impactB)Quality, frequency, and costC)Risk event, risk probability, and risk frequencyD)


5-B004 - The major processes associated with risk management are:

Planning, identification, qualitative analysis, quantitative analysis, response planning, monitoring and controlA)Planning, assessment, response development, analysis, reporting and controlB)Assessment, planning, quantitative analysis, response control, monitoring and reportingC)Response development, planning, qualitative analysis, response planning, measuring and reportingD)


5-B005 - Determining the probability of achieving a specific project objective may be made in which step of the risk management process:

PlanningA)IdentificationB)Response planningC)Quantitative analysisD)


5-B006 - John has been managing the project for five months when the customer requests a change that would significantly affect the project outcome and thus, increase risk to the project. What step should John take first?

Call a meeting of the Change Control BoardA)Analyze the impact of the change with the project teamB)Ensure he and the customer come to an agreement about when the change will be madeC)Update the risk management planD)

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5-B007 - During the implementation phase of a new systems project, a fire erupts during hardware installation causing damage to the facility. This is an example of:

Unpredictable riskA)External riskB)Business riskC)Insurable (pure) riskD)


5-B008 - Calculating expected monetary value for all project risks (sum of the probability of all risk events times the anticipated impacts), helps the project manager determine the value of the:

Project reserveA)Overall project budgetB)Funds available for workaroundsC)Additional resources necessary to mitigate the identified risksD)


5-B009 - In deciding to bid on a given project, the profit or loss outcome is fully known based on prior experience with similar projects. This would be an example of decision making under:

CertaintyA)UncertaintyB)Mitigated riskC)Predictable riskD)


5-B010 - A project manager's utility function describes the project manager's:

Use of historical data in risk assessmentA)Utilization of commercial databases in risk estimationB)Risk identification strategyC)Attitude toward riskD)


5-B011 - Using the table below, the expected profit (or loss) of using the aggressive schedule is:

($25,000)A)$75,000B)$78,000C)$100,000D)


5-B012 - Using the table below, the expected profit (or loss) of using the conservative schedule is:

($2,000)A)$75,000B)$78,000C)$80,000D)


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5-B013 - Using the table below, the aggressive schedule is likely to be adopted by a:

Risk-mitigating project managerA)Risk-averse project managerB)Risk-seeking project managerC)Risk-neutral project managerD)


5-B014 - Using the table below, the conservative schedule is likely to be adopted by a:

Risk-averse project managerA)Risk-seeking project managerB)Risk-indifferent project managerC)No project managerD)


5-B015 - Which of the following is not a useful tool for risk quantification?

Expected monetary valueA)Monte Carlo SimulationB)Cause and Effect DiagramC)Expert judgmentD)


5-B016 - A proper risk management plan will include a number of tools to support the measurement of probability and impact of risk events on project objectives. Which one of these tools would not be useful in this process?

InterviewingA)SimulationB)Control chartsC)Decision tree analysisD)


5-B017 - Which of the following is not considered for inclusion in risk mitigation?

Reducing the potential profit margin of the risk eventA)Reducing the expected monetary value of the risk eventB)Reducing the probability of occurrence of the risk eventC)Reducing the cost/impact of the risk eventD)


5-B018 - Which of the following is incorrect about workarounds?

They are unplanned in advance of the occurrence of the risk eventA)They are responses to negative risk eventsB)They are tools for risk response controlC)They are planned in advance of the occurrence of the risk eventD)


5-B019 - Which of the following is true about reserves?

They are provisions in the project plan to mitigate riskA)They are unplanned in advance of the occurrence of the risk eventB)They are primarily intended to be used for scope changesC)They are usually intended to reduce only the risk of missing cost or schedule objectivesD)


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5-B020 - Harry is responsible for risk response planning on his project. He will need to develop a set of procedures and techniques. One of the areas he has seen deteriorate into a risk situation is sponsor alignment. The original project sponsor left the organization and the new sponsor has not yet expressed his intentions about the project objectives. If the sponsor does not commit to certain key deliverables soon, the target date will be in jeopardy. Which of the following risk responses should Harry recommend?

MitigationA)TransferB)AcceptanceC)AvoidanceD)


5-B021 - There is a probability of 0.10 that a given risk event will occur in a project. If it occurs, it will result in a loss of $10,000. The insurance cost for this event is $1,200. Should a rational project manager buy this insurance?

Not enough information to determine an answerA)Yes, since the loss of $10,000 is too greatB)Yes, since the insurance cost is less than the lossC)No, since $1,200 > $1,000D)


5-B022 - An owner requests a contractor to provide a payment bond. This is an example of:

Risk mitigationA)Risk acceptanceB)Risk transferC)Risk assuranceD)


5-B023 - Which of the following is not a typical example of an internal risk?

Labor stoppageA)Cash flow issuesB)Safety considerationsC)Patent rights infringementD)


5-B024 - Which of the following is not an example of an external-predictable risk?

Cost of moneyA)Borrowing ratesB)Material availabilityC)Operations issuesD)


5-B025 - The utility function of a risk seeker is:

Exponential negativelyA)Positively skewedB)Increasing in rateC)Decreasing in rateD)


5-B026 - A contractor estimates that a project has 0.5 probability of $200,000 profit, 0.3 probability of $50,000 loss, and 0.2 probability of break-even. The expected monetary value of this project is:

$200,000A)$150,000B)$ 85,000C)$ 50,000D)


5-B027 - An organization is considering bidding on a project in a new technology area with which it has no prior experience. The organization cannot locate knowledgeable experts in that field. Therefore, probabilities cannot be assigned to possible profit or loss outcomes of this project. This would be an example of decision making under:

RiskA)UncertaintyB)Pure riskC)Business riskD)


5-B028 - An organization is considering bidding on a project in a new technology area with which it has no prior experience. The organization was able to locate knowledgeable experts in that field to help understand the new aspects. Therefore, probabilities can be assigned to possible profit or loss outcomes of this project. This would be an example of decision making under:

CertaintyA)RiskB)UncertaintyC)Pure riskD)


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5-B029 - A particular project manager tends to use avoidance as the risk-handling strategy in most situations. The decision behavior of this project manager is referred to as:

Uncertainty avoiderA)Risk averterB)Risk seekerC)Risk neutralD)


5-B030 - A particular project manager tends to use assumption as the risk-handling strategy in most situations. The decision behavior of this project manager is referred to as:

Risk averseA)Risk seekerB)Risk neutralC)Risk mitigationD)

References: \Kerzner (7th Edition) p. 906 \Anbari pp. 49-50

5-B031 - Based on historical data, the amount of overtime associated with the design effort of a particular project is estimated at 100 hours with 0.40 probability, 200 hours with 0.40 probability, and 300 hours with 0.20 probability. The expected value of the amount of overtime is:

100 hoursA)140 hoursB)180 hoursC)200 hoursD)


5-B032 - Based on historical data, the amount of overtime associated with the execution of a particular project is estimated at 100 hours with 0.50 probability, 200 hours with 0.40 probability, and 300 hours with 0.30 probability. The expected value of the amount of overtime is:

100 hoursA)200 hoursB)270 hoursC)Not possible to calculate based on the data providedD)

References: \Kerzner (7th Edition) pp. 909-910 \Anbari pp. 10 & 23-24

5-B033 - Based on historical data, the amount of overtime associated with the implementation of a particular project is estimated at 100 hours with 0.20 probability, 200 hours with 0.30 probability, and 300 hours with 0.50 probability. The expected value of the amount of overtime is:

100 hoursA)200 hoursB)230 hoursC)Not possible to calculate based on the data providedD)


5-B034 - Debra realizes she must determine the aspects of her project that may be at risk. Which of the following is not a useful tool for her to use in identifying these risks?

Ishikawa diagramsA)System or process flowchartsB)Interviews with stakeholdersC)Corrective actionD)


5-B035 - The probability distribution below represents the number of bids submitted monthly by a contracting firm. What is the expected value of the number of bids submitted monthly by this contracting firm?

2 bidsA)2.3 bidsB)2.5 bidsC)3 bidsD)


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5-B036 - The probability distribution below represents the number of bids submitted monthly by a contracting firm where the direct cost of preparing one bid is $10,000. What is the expected value of monthly direct cost of bid preparation to this contracting firm?

$20,000A)$23,000B)$25,000C)$60,000D)


5-B037 - The probability distribution below represents the number of bids submitted monthly by a contracting firm. What is the probability that this contracting firm submits three or fewer bids in a given month?

0.3A)0.5B)0.8C)0.7D)

References: \Kerzner (7th Edition) pp. 909-910 \Anbari p. 10

5-B038 - The probability distribution below represents the number of bids submitted monthly by a contracting firm where the direct cost of preparing one bid is $10,000. What is the probability that the direct cost of bid preparation to this contracting firm exceeds $30,000 in a given month?

0A)0.2B)0.3C)0.8D)


5-B039 - There is a probability of 0.10 that a given risk event will occur in a project. If it occurs, it will result in a loss of $10,000. The insurance cost for this event is $700 with a deductible amount of $250. Should a project manager buy this insurance?

Yes, since $1,000 > $950A)Yes, since $1,000 > $700B)No, since the insurance cost plus the deductible amount is higher than the lossC)No, since the deductible amount changes the expected value of the risk eventD)


5-B040 - In the range of contract types, from Firm-Fixed Price (FFP) to Cost Plus Fixed Fee (CPFF), where is the risk the greatest for the buyer?

Firm Fixed PriceA)Fixed Price Incentive Firm TargetB)Cost Plus Fixed FeeC)Cost Plus Award FeeD)


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5-C001 - Uncertainty mainly refers to a situation where:

Neither the outcomes nor their probabilities are knownA)Both the outcomes and their probabilities are knownB)The outcomes are known but their probabilities are highC)The states of nature can change at any timeD)


5-C002 - To ensure thorough risk identification, the project manager should make use of the project:

NetworkA)Statement of WorkB)Work Breakdown StructureC)BudgetD)


5-C003 - Susan's team has just responded to her request for a review of the project plan. Several areas of risk have appeared that suggest to Susan that an appropriate response will be necessary. What input would Susan not likely review to help her with the analysis before assessing the impact and likelihood of the identified risks:

Project assumptionsA)Risk management planB)Communications planC)Identified risksD)


5-C004 - A project has a 75% chance of successfully achieving its $500,000 objective and a 25% chance of an equal amount of loss. The expected monetary value for the project is:

$500,000 gainA)$250,000 gainB)$125,000 lossC)$250,000 lossD)


5-C005 - Given the following possible loss outcomes of a project event, find the expected total loss:

$0A)$1,300B)$2,000C)$3,000D)


5-C006 - Given the following diagram, what is the probability that alternative I will be adopted and completed below budget?

1.4A)0.8B)0.2C)0.12D)


5-C007 - Which of the following activities can be considered as part of risk mitigation?

Risk identificationA)Purchasing insuranceB)Assessment of outcomesC)Assessment of probabilitiesD)


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5-C008 - Jean is preparing her risk management plan. She knows she must address risk identification, qualitative and quantitative analyses, response planning and control. Which aspect is not included in the plan?

Roles and responsibilitiesA)Responses to individual risksB)Threshold criteria for risksC)Content and format of the risk response planD)


5-C009 - Risk monitoring enables the project manger to keep track of the identified risks, monitor residual risks, ensure execution of the risk plan and evaluate effectiveness in reducing and handling risk. The objectives of risk monitoring include all but the following:

Proper responses have been deployed as plannedA)Project assumptions are still validB)Project Charter is still validC)Risks have occurred that were not previously identifiedD)


5-C010 - Risk quantification is determined by considering the relationship of the probability that an event will occur, prioritization of the identified risks and a measure of the amount at stake. Total project risk can be defined as:

The sum of the probabilities of project risk events times the sum of the consequences of those risksA)The sum of the products of the probability of each project risk event times its consequenceB)The sum of the consequences of all project risk eventsC)The largest of the probabilities of all project risk eventsD)


5-C011 - Which of the following actions is not an example of a sound risk mitigation approach?

Adjust the project parameters (scope, time, cost, and quality), as appropriateA)Reduce the probability of potential project risk eventsB)Reduce the consequences of potential project risk eventsC)Wait until a problem actually happens, then deal with it in the most effective and efficient mannerD)


5-C012 - Monte Carlo Simulation is a quantitative risk simulation technique that:

Was originally developed by Dr. CarloA)Is a European technique for assessing project risksB)Performs a project simulation many times to calculate a distribution of likely resultsC)Is a technique to simulate creative risk event resolutionD)

References: \PMBOK(r) Guide pp. 137 & 203 \Anbari pp. 52-53

5-C013 - Project issues can develop in a number of areas, including those related to new processing platforms, resource availability, scope shift or change in marketplace demands. Which of the following areas would the project manger characterize as an internal risk source:

Environmental legal opinionA)Government policy changesB)Change in equipment availabilityC)Regulatory policy shiftD)


5-C014 - Which of the following risks is generally considered unpredictable?

Business risksA)InflationB)Natural hazardsC)TaxesD)


5-C015 - Which of the following diagrams is most useful in impact analysis to help quantify risk?

Decision treesA)Precedence diagramsB)Responsibility matrixC)Cause and effect diagramsD)


5-C016 - Delphi method is an information gathering technique used for risk identification. Which of the following is true about this method?

It is a computer-based, risk identification techniqueA)It is a method for achieving consensus during a meeting of expertsB)It is a judgmental forecasting techniqueC)It is a graphical method for considering interdependencies among risk eventsD)


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5-C017 - Which of the following is true about the Delphi Method?

It makes use of questionnaires sent to a panel of expertsA)It requires that individual feedback be provided by each panel memberB)It is not used for forecastingC)It is not useful in making decisionsD)


5-C018 - Which of the following is true about project risk deflection?

It allows risks to be absorbed by the management reserveA)It concentrates on reducing the probability of risk eventsB)It can be used to transfer risk to another party through a contractC)It is the act of declining high-risk alternativesD)

References: \PMBOK(r) Guide pp. 142-143 \Kerzner (7th Edition) pp. 934-935

5-C019 - Which of the following is not included in risk response planning?

Defining approaches for taking advantage of opportunitiesA)Determining steps to respond to threatsB)Contingency planningC)Reacting to a risk eventD)


5-C020 - During the initial risk management planning, Dave knew that his risk plan required a set of deliverables from the risk monitoring and control processes. These included such steps as developing work around plans, taking corrective action and issuing project change requests. What primary purpose is served by having Dave create these deliverables?

Create an effective project surveillance strategyA)Ensure the risk responses have been implemented as plannedB)Establish a proper quality control mechanismC)Help Dave feel he had done all he could about preserving the project end datesD)


5-C021 - Historical data indicate that the probability of late equipment delivery to the project site is 5%. What is the probability of no late equipment delivery to the project site?

5%A)10%B)50%C)95%D)


5-C022 - Consider the following data sample on repair times, in minutes, for certain equipment used on a project: 17, 19, 21, 21, and 22. The mean repair time for this equipment is:

19 minutesA)20 minutesB)21 minutesC)100 minutesD)


5-C023 - Your project has hit upon a major issue and you cannot move forward until this issue is resolved. As it turns out, you did not include contingency for this issue in your risk management plan. You should now:

Inform the customer of the issue and negotiate a new end dateA)Call the sponsor to elicit help to resolve the problemB)Create a work aroundC)Re-write the project planD)


5-C024 - Once the risk quantification activities have been completed, the project manager will have in place all but the following:

Prioritized list of risksA)Forecast of potential cost and schedule impactsB)Probability of achieving project targetsC)Quality control planD)


5-C025 - Rick has just completed his project plan for the next phase. He believes there will be a significant potential for profitability from this initiative if it is successful. He is also a realist and knows there can be an equally substantial potential for loss. Rick can classify his assessment of risk as:

BusinessA)PureB)ExternalC)InsurmountableD)


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5-C026 - Which of the following measures of central tendency does not depend on the exact value of each measurement in the sample?

The meanA)The medianB)The modeC)The 50% percentileD)


5-C027 - Two events comprise an activity noted as "R." The likelihood of their occurrences is listed as: 1) 45% with an impact of $45,000 and 2) 20% with an impact of $100,000. What is the expected value for the activity "R"?

$20,250A)$145,000B)$40,250C)Unable to complete the calculation with the data providedD)


5-C028 - A project manager is trying to make a decision on how mush risk could he handle on a given project. Which document could help the project manager decide how much latitude he has and the importance of the project?

The Work Breakdown StructureA)Cause-and-Effect DiagramB)The Project CharterC)Network DiagramD)


5-C029 - Which of the following is true about Monte Carlo simulation?

It can generate the best estimate of milestone dates for the projectA)It is driven by the certainty of relevant factorsB)It can be used to identify realistic and achievable cost, schedule or scope targetsC)It eliminates all uncertainty associated with estimating the completion date of the projectD)

References: \PMBOK(r) Guide p. 137 \Anbari pp. 51-53

5-C030 - George faces a series of high-risk events that could potentially stop the project. Which of the following is likely to be the most effective strategy for George to handle these risks?

AvoidanceA)AssumptionB)TransferC)DeflectionD)


5-C031 - If George addresses the low risk events in his project by stating that he knows the risk exists, he is aware of the consequences and is willing to wait it out, which of the following risk-handling strategies is George following?

AvoidanceA)AssumptionB)TransferC)Knowledge and researchD)


5-C032 - In a cost reimbursable contract such as Cost Plus Fixed Fee (CPFF), what are the associated risks about cost?

The buyer will have to cover all increased costsA)The seller will have to cover costsB)The seller is protected from covering increased costsC)There are never increased costs for CPFF contractsD)


5-C033 - Which of the following is not included in risk monitoring and control?

Implementing the risk management planA)Using a static risk management planB)Implementing workarounds as neededC)Taking corrective actionD)


5-C034 - Donald must measure the likelihood of his suppliers delivering the necessary material in accordance with his project schedule. Which of the following tools would he not use in his risk analysis?

Decision analysisA)SimulationB)Forward PassC)Probability analysisD)


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5-C035 - One of the most frequently used tools in risk identification is:

Data precision rankingA)BrainstormingB)SimulationC)Decision tree analysisD)


5-C036 - Equipment deliveries are scheduled throughout the life of a project. Historical data indicate that the probability of late equipment delivery to the project site is 5%. When the project reaches the 50% completion point, what is the probability of late equipment delivery during the remainder of the project?

0%A)2.5%B)5%C)10%D)


5-C037 - When changing the scope of a project to lower the associated risk, the project manager should consider the impact on:

ScheduleA)CostB)QualityC)The triangle of time, cost and performance constraintsD)


5-C038 - Equipment deliveries are scheduled throughout the life of a project. Historical data indicate that the probability of late equipment delivery to the project site is 10%. When the project reaches the 75% completion point, what is the probability of no late equipment delivery during the remainder of the project?

7.5%A)10%B)85%C)90%D)


5-C039 - Once you have put a proper risk response plan in place, you will be able to monitor all but one of the following:

Time and schedule estimates have been completedA)A risk trigger has occurredB)Determine whether new risk responses are requiredC)Analysis of risk trendsD)


5-C040 - Risk identification is defined as all but one of the following:

An iterative processA)Presented in terms of cause and effectB)Being examined from the perspective of strengths, weaknesses, opportunities and threatsC)Not essential to risk managementD)


Answers:

5-A001 B5-A002 C5-A003 C5-A004 B5-A005 A5-A006 D5-A007 A5-A008 A5-A009 D5-A010 B5-A011 D5-A012 A5-A013 D5-A014 A5-A015 C5-A016 A5-A017 D5-A018 D5-A019 D5-A020 D5-A021 B5-A022 C

5-A023 B5-A024 A5-A025 B5-A026 C5-A027 C5-A028 A5-A029 C5-A030 C5-A031 C5-A032 D5-A033 D5-A034 B5-A035 C5-A036 C5-A037 C5-A038 B5-A039 D5-A040 C5-B001 B5-B002 B5-B003 A5-B004 A

5-B005 D5-B006 B5-B007 D5-B008 A5-B009 A5-B010 D5-B011 B5-B012 C5-B013 C5-B014 B5-B015 C5-B016 C5-B017 A5-B018 D5-B019 A5-B020 A5-B021 D5-B022 C5-B023 D5-B024 D5-B025 C5-B026 C

5-B027 B5-B028 B5-B029 B5-B030 B5-B031 C5-B032 D5-B033 C5-B034 D5-B035 B5-B036 B5-B037 C5-B038 B5-B039 A5-B040 C5-C001 A5-C002 C5-C003 C5-C004 B5-C005 B5-C006 D5-C007 B5-C008 B

5-C009 C5-C010 B5-C011 D5-C012 C5-C013 C5-C014 C5-C015 A5-C016 C5-C017 A5-C018 C5-C019 D5-C020 B5-C021 D5-C022 B5-C023 C5-C024 D5-C025 A5-C026 B5-C027 C5-C028 C5-C029 C5-C030 A

5-C031 B5-C032 A5-C033 B5-C034 C5-C035 B5-C036 C5-C037 D5-C038 D5-C039 A5-C040 D

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Project Management IQ - Risk

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