Managing Risk

Multiple Choice Questions

1. An uncertain event or condition that, if it occurs, has a positive or negative effect on a project objectives is
termed.
A. Random chance
B. A disaster
C. Risk
D. Hazard
E. Bad luck

2. The chances of a risk event occurring as a project proceeds through its life cycle tends to
A. Slowly rise
B. Drop sharply and then level out
C. Rise sharply and then level out
D. Remain about the same
E. Slowly drop

3. The cost impact of a risk event occurring as a project proceeds through its life cycle tends to
A. Slowly rise
B. Drop sharply and then level out
C. Rise sharply and then level out
D. Remain about the same
E. Slowly drop

4. The attempt to recognize and manage potential and unforeseen trouble spots that may occur when a project is
implemented is known as
A. Risk forecasting
B. Risk management
C. Contingency planning
D. Scenario analysis
E. Disaster protection

5. Which of the following is not one of the steps in the risk management process?
A. Risk response development
B. Risk assessment
C. Risk identification
D. Risk tracking
E. Risk response control

6. The initial step in the risk management process is to
A. Determine the level of acceptable risk
B. Assess the risk potential
C. Identify the risks
D. Set aside budget funds for managing the risks
E. Appoint a risk manager

7. One common mistake made early in the risk identification process is to
A. Not all possibilities are considered
B. Participants are over-optimistic
C. Participants are over-pessimistic
D. Focus on objectives and not on the events that could produce consequences.
E. Too much attention is given to past events

8. In the beginning the focus of risk management should be on risks that
A. Impact the whole project
B. Impact the critical path
C. Are known
D. Have the greatest cost impact
E. Have the greatest schedule impact

9. Which of the following would not be considered a threat?
A. Inflation
B. Meeting the project schedule
C. International disruptions
D. Economic conditions
E. Competition

10. A list of questions that address traditional areas of uncertainty on a project is termed a risk
A. Risk profile
B. Questionnaire
C. Research
D. Query
E. Checklist

11. All of the following are included in the risk identification process except
A. Customers
B. Subcontractors
C. Competitors
D. Vendors
E. None of these are included

12. The easiest and most commonly used technique for analyzing risks is _____ analysis.
A. Probability
B. Scenario
C. Payback
D. Risk/reward
E. Impact

13. The risk management tool that is divided into three color-coded zones representing major, moderate, and minor
risks is the risk
A. Assessment form
B. Responsibility matrix
C. Scenario assessment
D. Impact assessment
E. Risk severity matrix

14. The risk assessment form contains all of the following except
A. Likelihood of the risk event occurring
B. Potential impact of the risk event
C. Who will detect the occurrence of the risk event.
D. Difficulty of detecting the occurrence of the risk event
E. When the risk event may occur

15. The two scales of a risk severity matrix measure
A. Time, cost
B. Cost, schedule
C. Impact, cost
D. Time, impact
E. Likelihood, impact

16. This risk assessment tool is a variation of the risk severity matrix that includes the ease of detection for each of
the identified risks.
A. PERT simulation
B. FMEA analysis
C. Ratio/range analysis
D. Probability analysis
E. Semi-quantitative analysis

17. Which of the following is not included in a Failure Mode and Effects Analysis?
A. Impact
B. Probability
C. Detection
D. Risk value
E. All of these are included

18. Which of the following is not one of the potential responses to a specific risk event?
A. Mitigating
B. Retaining
C. Ignoring
D. Transferring
E. Sharing

19. A Risk Response Matrix contains all of the following except
A. Contingency plan
B. Trigger
C. Who is responsible?
D. Response
E. All of these are included in the matrix

20. Change management systems are designed to accomplish all of the following except:
A. Track all changes that are to be implemented
B. Review, evaluates, and approve/disapprove proposed changes formally
C. Identify expected effects of proposed changes on schedule and budget
D. Reflect scope changes in baseline and performance measures
E. All of the above are correct