MAN 4583 FINAL EXAM QUESTIONS AND VERIFIED
ANSWERS
Risk - Answers - What is an uncertain event or condition that, if it occurs, has a positive
or negative effect on project objectives?
1. Hold a brainstorming session
2. Industry specific risk categories
3. Look at WBS and identify risks by tasks or group of tasks - Answers - What are the 3
steps in understanding risks?
Develop a risk management plan
1. Identify risks
2. Perform qualitative & quantitative risk analysis
3. Risk response plans
4. Risk register - Answers - What are the four ways to manage project risk?
Risk Plan - Answers - What is a document that describes how project risk management
will be structured and performed on a project?
Avoiding - Answers - Adopting proven technology instead of experimental technology in
order to eliminate technical failure would be an example of which risk response?
Identify risks - Answers - What is the initial step in the risk management process?
Risk Management - Answers - The attempt to recognize and manage potential and
unforeseen trouble spots that may occur when a project is implemented is known as
what?
Focus on consequences and not on the events that could produce consequences. -
Answers - What is one common mistake made early in the risk identification process?
One - Answers - The risk response plans should have _______ owner(s).
Risk breakdown structures - Answers - Organizations use ____ in conjunction with work
breakdown structures to help management teams identify and eventually analyze risk.
Baseline Schedule - Answers - The risk management plan should be created prior to a
________.
Assess identified risks - Answers - After your team has successfully identified potential
risks that could affect the project, what is the next step?
,Assess risks - Answers - Tools such as a risk assessment form and a risk severity
matrix are used to do what?
A 50% $90,000 - Answers - Which of the following is your least important risk?
Risk/Probability/Impact?
A 50% $90,000
B 75% $100,000
C 25% $200,000
D 40% $160,000
Transferring - Answers - Purchasing an accident insurance policy would be an example
of responding to a risk by ____ it.
Likelihood and impact - Answers - Risks are evaluated in terms of what?
Probability and Impact - Answers - What are two important basic concepts at the core of
any type of project risk analysis?
Taking action that will cause the risk to do as little damage to the project as possible -
Answers - Which of the following defines risk mitigation?
Ignoring - Answers - Which of the following is NOT one of the potential responses to a
specific risk event
Retaining - Answers - The risk associated with the unlikelihood that one of the key
members will be struck by lightning would most likely be handled by which of the
following?
Technical risks - Answers - Risks that can result in a system or process that will not
work are known as what?
Budget - Answers - Funds that are for identified risks that have a low probability of
occurring and that decrease as the project progresses are called ______ reserves.
Management Reserves - Answers - Which of the following is identified to cover major
unforeseen risks and, hence, are applied to the total project?
Risk Anticipation - Answers - The first step in the risk management process is ____.
Risk Assessment - Answers - The ____ form identifies each risk event, the likelihood of
it occurring, the potential impact, when it may occur, and the degree of difficulty in
detecting it.
,Risk Profile - Answers - A list of questions that address traditional areas of uncertainty
on a project is known as a what?
Risk Value - Answers - According to the Failure Mode and Effects Analysis (FMEA),
Impact x Probability x Detection = ____.
Risk Severity - Answers - The ____ matrix is divided into red, yellow, and green zones
representing major, moderate, and minor risks.
Transferring risk - Answers - What is a fixed price contract an example of?
A risk response is part of the actual implementation plan and action is taken before the
risk can materialize, while a contingency plan goes into effect only after the risk has
transpired - Answers - What is a key distinction between a risk response and a
contingency plan?
Avoiding - Answers - When considering risk response development, changing the plan
to eliminate the risk or condition is known as ____ the risk.
Retaining - Answers - When considering risk response development, assuming the risk
because the chance of such an event is slim is known as ____ the risk.
Mitigating - Answers - When considering risk response development, reducing the
likelihood that an event will occur and/or reducing the impact that an adverse event
would have on a project is known as ____ the risk.
Transferring - Answers - When considering risk response development, passing risk to
another party instead of changing it is known as ____ the risk.
Mitigating - Answers - Testing a new project on a smaller isolated area prior to installing
it for the entire organization is an example of ____ a risk.
Transferring - Answers - Performance bonds, warranties, and insurance are examples
of ____ a risk.
Avoiding - Answers - Choosing to move a concert indoors to eliminate the threat of bad
weather is an example of ____ a risk.
Retain - Answers - Flooding would be devastating to the project; however, it is very
unlikely. The project manager is most likely to ____ this risk.
Avoid - Answers - For your construction project, the architect's design isn't fit for the
purpose of the structure. There is a chance that if your team builds the structure, it will
not last as long as intended. What would be the best risk response?
, Accept - Answers - You are hiring an intern to work with your team on a new project.
There is a risk that they intern will make mistakes throughout the project since they are
still learning. What would be the best risk response?
Contingency plan - Answers - A ____ is an alternative that will be used if a possible
foreseen risk event becomes a reality.
Trigger - Answers - The event or point in time when a contingency plan will be
implemented is called a ____.
Management - Answers - ___ reserves are controlled by the project manager and the
owner of the project and are used to cover major unforeseen risks to the entire project.
Budget - Answers - ____ reserves are identified for specific work packages and are
distributed by the project manager and the team members.
Detection difficulty - Answers - ___ is a measure of how easy it would be to notice that a
risk event was going to occur in time to take mitigating action, that is, how much
warning you would have.
Change management. - Answers - ___ systems involve reporting, controlling, and
recording changes to the project baseline.
False - Answers - T/F: Responses to all identifiable risks should be a top priority for the
project manager.
False - Answers - T/F: The risk identification process should be limited to just the core
project team.
True - Answers - T/F: Contingency funding is made up of budget reserves and
management reserves.
True - Answers - T/F: Budget reserves are set up to cover identified risks associated
with specific segments of a project while management reserves are set up to cover
unidentified risks associated with the total project.
True - Answers - T/F: The probability that a risk event will occur is higher during the
initial stages of a project.
False - Answers - T/F: Risk management is a reactive approach that is designed to
ensure that surprises are reduced and that negative consequences associated with
undesirable events are minimized.
True - Answers - T/F: One common mistake that is made early on in the risk
identification process is to focus on consequences and not on the events that could
produce consequences.
ANSWERS
Risk - Answers - What is an uncertain event or condition that, if it occurs, has a positive
or negative effect on project objectives?
1. Hold a brainstorming session
2. Industry specific risk categories
3. Look at WBS and identify risks by tasks or group of tasks - Answers - What are the 3
steps in understanding risks?
Develop a risk management plan
1. Identify risks
2. Perform qualitative & quantitative risk analysis
3. Risk response plans
4. Risk register - Answers - What are the four ways to manage project risk?
Risk Plan - Answers - What is a document that describes how project risk management
will be structured and performed on a project?
Avoiding - Answers - Adopting proven technology instead of experimental technology in
order to eliminate technical failure would be an example of which risk response?
Identify risks - Answers - What is the initial step in the risk management process?
Risk Management - Answers - The attempt to recognize and manage potential and
unforeseen trouble spots that may occur when a project is implemented is known as
what?
Focus on consequences and not on the events that could produce consequences. -
Answers - What is one common mistake made early in the risk identification process?
One - Answers - The risk response plans should have _______ owner(s).
Risk breakdown structures - Answers - Organizations use ____ in conjunction with work
breakdown structures to help management teams identify and eventually analyze risk.
Baseline Schedule - Answers - The risk management plan should be created prior to a
________.
Assess identified risks - Answers - After your team has successfully identified potential
risks that could affect the project, what is the next step?
,Assess risks - Answers - Tools such as a risk assessment form and a risk severity
matrix are used to do what?
A 50% $90,000 - Answers - Which of the following is your least important risk?
Risk/Probability/Impact?
A 50% $90,000
B 75% $100,000
C 25% $200,000
D 40% $160,000
Transferring - Answers - Purchasing an accident insurance policy would be an example
of responding to a risk by ____ it.
Likelihood and impact - Answers - Risks are evaluated in terms of what?
Probability and Impact - Answers - What are two important basic concepts at the core of
any type of project risk analysis?
Taking action that will cause the risk to do as little damage to the project as possible -
Answers - Which of the following defines risk mitigation?
Ignoring - Answers - Which of the following is NOT one of the potential responses to a
specific risk event
Retaining - Answers - The risk associated with the unlikelihood that one of the key
members will be struck by lightning would most likely be handled by which of the
following?
Technical risks - Answers - Risks that can result in a system or process that will not
work are known as what?
Budget - Answers - Funds that are for identified risks that have a low probability of
occurring and that decrease as the project progresses are called ______ reserves.
Management Reserves - Answers - Which of the following is identified to cover major
unforeseen risks and, hence, are applied to the total project?
Risk Anticipation - Answers - The first step in the risk management process is ____.
Risk Assessment - Answers - The ____ form identifies each risk event, the likelihood of
it occurring, the potential impact, when it may occur, and the degree of difficulty in
detecting it.
,Risk Profile - Answers - A list of questions that address traditional areas of uncertainty
on a project is known as a what?
Risk Value - Answers - According to the Failure Mode and Effects Analysis (FMEA),
Impact x Probability x Detection = ____.
Risk Severity - Answers - The ____ matrix is divided into red, yellow, and green zones
representing major, moderate, and minor risks.
Transferring risk - Answers - What is a fixed price contract an example of?
A risk response is part of the actual implementation plan and action is taken before the
risk can materialize, while a contingency plan goes into effect only after the risk has
transpired - Answers - What is a key distinction between a risk response and a
contingency plan?
Avoiding - Answers - When considering risk response development, changing the plan
to eliminate the risk or condition is known as ____ the risk.
Retaining - Answers - When considering risk response development, assuming the risk
because the chance of such an event is slim is known as ____ the risk.
Mitigating - Answers - When considering risk response development, reducing the
likelihood that an event will occur and/or reducing the impact that an adverse event
would have on a project is known as ____ the risk.
Transferring - Answers - When considering risk response development, passing risk to
another party instead of changing it is known as ____ the risk.
Mitigating - Answers - Testing a new project on a smaller isolated area prior to installing
it for the entire organization is an example of ____ a risk.
Transferring - Answers - Performance bonds, warranties, and insurance are examples
of ____ a risk.
Avoiding - Answers - Choosing to move a concert indoors to eliminate the threat of bad
weather is an example of ____ a risk.
Retain - Answers - Flooding would be devastating to the project; however, it is very
unlikely. The project manager is most likely to ____ this risk.
Avoid - Answers - For your construction project, the architect's design isn't fit for the
purpose of the structure. There is a chance that if your team builds the structure, it will
not last as long as intended. What would be the best risk response?
, Accept - Answers - You are hiring an intern to work with your team on a new project.
There is a risk that they intern will make mistakes throughout the project since they are
still learning. What would be the best risk response?
Contingency plan - Answers - A ____ is an alternative that will be used if a possible
foreseen risk event becomes a reality.
Trigger - Answers - The event or point in time when a contingency plan will be
implemented is called a ____.
Management - Answers - ___ reserves are controlled by the project manager and the
owner of the project and are used to cover major unforeseen risks to the entire project.
Budget - Answers - ____ reserves are identified for specific work packages and are
distributed by the project manager and the team members.
Detection difficulty - Answers - ___ is a measure of how easy it would be to notice that a
risk event was going to occur in time to take mitigating action, that is, how much
warning you would have.
Change management. - Answers - ___ systems involve reporting, controlling, and
recording changes to the project baseline.
False - Answers - T/F: Responses to all identifiable risks should be a top priority for the
project manager.
False - Answers - T/F: The risk identification process should be limited to just the core
project team.
True - Answers - T/F: Contingency funding is made up of budget reserves and
management reserves.
True - Answers - T/F: Budget reserves are set up to cover identified risks associated
with specific segments of a project while management reserves are set up to cover
unidentified risks associated with the total project.
True - Answers - T/F: The probability that a risk event will occur is higher during the
initial stages of a project.
False - Answers - T/F: Risk management is a reactive approach that is designed to
ensure that surprises are reduced and that negative consequences associated with
undesirable events are minimized.
True - Answers - T/F: One common mistake that is made early on in the risk
identification process is to focus on consequences and not on the events that could
produce consequences.
