Course: Postgraduate Diploma in Project Management

Unit: 05 (Project Risk Management)

During which of the Risk planning stage modelling techniques are used to determine overall
effects of risks on project objectives for high probability, high impact risks?

A) Identify Risks

B) Plan Risk responses

C) Perform Qualitative risk analysis

D) Perform Quantitative risk analysis

ANSWER: D

Figuring out is the process of______

A) Risk clarification

B) Risk registration

C) Risk identification

D) Risk rectification

ANSWER: C

Five of the processes in Project Risk Management are from which process group?

A) Initiating

B) Planning

C) Executing

D) Monitoring and Control

ANSWER: B

How many sets of processes and practices established the Project Management Institute
Inc. (PMI)?

A) Five
B) Six

C) Seven

D) Eight

ANSWER: B

Identifying alternative strategies' is also known as a _________________

A) Emergency plan

B) Incident plan

C) Back-up plan

D) Contingency plan

ANSWER: D

Mathew is a Project Manager for software migration at a bank. A major risk that has been
identified is attrition of resources. As a strategy to respond to this risk, Mathew, with support
from Senior Management, provides good increments to his team members. What type of risk
response is Mathew following?

A) Accept

B) Avoid

C) Transfer

D) Mitigate

ANSWER: D

Mr. Kevin is a Project Manager for a reforestation project. To identify the risks involved, he
sends a questionnaire to gather inputs from experts. Which technique is Kevin using?

A) Delphi technique

B) Interviews

C) Brain storming

D) Documentation review

ANSWER: A
Mr. Smith is a Project Manager for Green Valley project. Risk Identification has been
completed for the project. Which of the following should he do next?

A) Perform Qualitative risk analysis

B) Perform Quantitative risk analysis

C) Identify Risks

D) Plan Risk responses

ANSWER: A

Mr. X has joined as the Project Manager of a project. One of the project documents available
to ‘X’ lists down all the risks in a hierarchical fashion. What is this document called?

A) Risk Management Plan

B) List of risks

C) Monte Carlo diagram

D) Risk Breakdown Structure

ANSWER: D

Mr. X is a Project Manager for Green Valley project. A risk management plan has been
prepared for the project. Which of the following should ‘X’ do next?

A) Perform Qualitative risk analysis

B) Perform Quantitative risk analysis

C) Identify Risks

D) Plan Risk responses

ANSWER: C

Risk management is responsibility of the

A) Customer

B) Investor

C) Developer
D) Project team

ANSWER: D

The cost impact of a risk event in the project is less if the event occurs_________________

A) later rather than earlier

B) middle of the project

C) earlier rather than later

D) at the end

ANSWER: C

The fundamental information gathered against any risk is stored in a __________________

A) Risk Register

B) Risk Charter

C) Project Charter

D) Project Register

ANSWER: A

The output of risk identification is _______

A) Risk register

B) Risk identification

C) Risks linked

D) Risk statement

ANSWER: A

The PMBOK Guide definition of risk limits the discussion to potential events that might affect
________________

A) Project Risk

B) Project objectives
C) Project outcome

D) Project value

ANSWER: B

The source of the risk is described by

A) Risk cause

B) Risk event

C) Risk factor

D) Risk effect

ANSWER: A

There is two chance in ten that a risk event will cause you to lose $2,000. What is the value
of Risk?

A) $200

B) $400

C) $2,000

D) $100

ANSWER: B

Which of the following is a common mistake made early in the risk identification process?

A) Focus on risk

B) Focus on objectives

C) Focus on consequences

D) Focus on actual event

ANSWER: B

Which of the following is NOT correct regarding risk management?

A) It is a proactive approach
B) It is preventive process

C) It ensures that surprises are reduced

D) It maximises the negative consequences

ANSWER: D

Which of the following is NOT the strategy to manage Threats in a project?

A) Accept

B) Escalate

C) Avoid

D) Enhance

ANSWER: D

Which of the following reflects the personality of the risk analyst in a given situation?

A) The degree of risk analyst

B) The degree of risk assigned

C) Family background of risk analyst

D) Work experience of risk analyst

ANSWER: B

Which of the following risk management techniques is recommended for all projects when
their initiating documents are complete?

A) Qualitative risk analysis

B) Decision Tree Analysis

C) Documentation Reviews

D) Delphi Technique

ANSWER: C

Which of the following statements best describes risk?

B) Uncertainty which matters to us

C) Certainly, of not suffering harm or loss

D) Clarity in future decisions

ANSWER: B

Which of the following techniques examines risk from a one-at-a-time perspective?

A) PERT

B) Decision Tree Analysis

C) Simulations

D) Sensitivity Analysis

ANSWER: D

Which one of the following is NOT Key Success Factors for Identifying Risks?

A) Emergent identification

B) Multiple perspectives

C) Monitoring and control

D) Complete risk statement

ANSWER: C

SQ 1

For the design and development of a new plane, Boeing identifies four categories of risks,
which are shown in the left column below. In the right column are four possible mitigation
strategies for the four categories. Select one and only one mitigation strategy from the right
column to go with the left column.
SQ 2

Below are four responses to a risk situation made by a project manager. For each of the
project manager’s responses, from the list below select which response mechanism best fits
the project manager’s remarks.
A. Assumption/ acceptance
B. Avoidance
C. Mitigation
D. Transfer

R1. “I know we have three different designs we can select from in order to satisfy the
customer’s requirements. However, I am very reluctant to consider the second option
because, if we are wrong, there exists the chance of imminent damage to the project.”
Response mode: _____

R2. “This design has a very high possibility of creating a severe financial problem for us. I
have asked the design team to develop an alternative that will minimize our risk exposure”
Response mode: _____

R3. “I know we can manufacture the product ourselves, but there are a number of potential
risks to consider. I would rather award a fixed-price contract to Alpha Company and have
them do the manufacturing instead. They have a strong record of success in this area”
Response mode: _____

R4. “I have set up a management reserve just in case there are escalations in the costs of
the raw materials we must purchase.”
Response mode: _____

SQ 3

Explain how you can use ‘Brainstorming’ techniques to identify and analyse risk in a project.

SQ 4

Discuss Simulation and Sensitivity Analysis

SQ 5

Analyse the five Strategies to Manage Threats with an example for each strategy.

(Mark Distribution: Each MCQ and short question contains 2 Marks and 6 Marks
respectively.)