Practice Test

True or False: Effective risk response actions should always completely eliminate the risk.

  • True
  • False

Answer: False

Explanation: Effective risk response actions aim to mitigate the probable risk, not necessarily eliminate it.

The highest level of risk is always the one that requires immediate response.

  • True
  • False

Answer: False

Explanation: The level of a risk does not always determine the urgency of a response. It depends on the risk’s potential impact on the project objectives.

Which of the following are common strategies for dealing with risks?

  • A. Avoidance
  • B. Mitigation
  • C. Exploitation
  • D. All of the above

Answer: D. All of the above

Explanation: These are all strategies for dealing with project risks. The chosen strategy depends on the nature of the risk and its potential impact on the project.

True or False: The impact of risk can only be negative.

  • True
  • False

Answer: False

Explanation: Risks can have either a positive or negative impact on project objectives.

After implementing risk response actions, it is important to:

  • A. Ignore the risk
  • B. Reassess the risk
  • C. Increase the risk
  • D. None of the above

Answer: B. Reassess the risk

Explanation: After risk response actions are implemented, it is important to reassess the risk to determine if the actions were effective.

The risk response plan is a dynamic document that should be updated regularly throughout the project.

  • True
  • False

Answer: True

Explanation: The risk response plan should be updated regularly as risks may change or evolve over the course of a project.

Select the best definition of risk response effectiveness?

  • A. The extent to which a risk response action eliminates a risk
  • B. The amount of money saved by implementing a risk response action
  • C. The degree to which a risk response action reduces the likelihood and/or impact of a risk
  • D. The speed at which a risk response action is implemented

Answer: C. The degree to which a risk response action reduces the likelihood and/or impact of a risk

Explanation: Risk response effectiveness is determined by the extent to which a response action reduces the potential risk.

The risk response plan should be developed by:

  • A. The project manager alone
  • B. The project team
  • C. The project stakeholders
  • D. All of the above

Answer: D. All of the above

Explanation: The risk response plan should be developed collaboratively by the project manager, team, and stakeholders.

True or False: Risk responses should be implemented even if they do not align with the project objectives.

  • True
  • False

Answer: False

Explanation: Risk responses should always align with, and support, the project objectives.

Effective risk responses are:

  • A. Efficient
  • B. Cost-effective
  • C. Do not deviate from the project objectives
  • D. All of the above

Answer: D. All of the above

Explanation: Effective risk responses should be efficient, cost-effective, and in line with the project’s objectives.

True or False: A strategy should be changed if its corresponding risk response is not effective.

  • True
  • False

Answer: True

Explanation: If a risk response is not effective, it means the strategy is not working, and should be reevaluated and changed if necessary.

It is crucial to communicate with stakeholders about the effectiveness of risk response actions.

  • True
  • False

Answer: True

Explanation: Regular communications with stakeholders helps manage expectations, keep them informed, and ensures transparency about the risk management process.

After implementing a risk response, the remaining risk that still exists is called:

  • A. Secondary risk
  • B. Residual risk
  • C. Tertiary risk
  • D. High risk

Answer: B. Residual risk

Explanation: The risk that remains after a response action has been taken is called “residual risk”.

During risk reassessment, if the risk has not been reduced to an acceptable level:

  • A. Cancel the project
  • B. Ignore the risk
  • C. Reapply risk response strategies
  • D. All of the above

Answer: C. Reapply risk response strategies

Explanation: If the risk level is still not acceptable after the initial response, it might be necessary to reapply or modify the risk response strategies.

True or False: The effectiveness of risk response actions is measured purely by the financial impact on the project.

  • True
  • False

Answer: False

Explanation: The effectiveness of risk response actions is measured by a variety of factors including alignment with project objectives, reduction in likelihood or impact of risk, cost considerations, and more.

Interview Questions

What is the first step in assessing the effectiveness of risk response actions?

The first step involves the review of the response actions taken to implement the risk management strategy.

What role do key performance indicators (KPIs) play in assessing the effectiveness of risk response actions?

KPIs measure the performance and success of an organization’s risk management strategy. They give quantifiable metrics that offer insights into the effectiveness of risk response actions.

What are some techniques used in assessing the effectiveness of the risk response actions?

Techniques might include the usage of risk audits, meetings, data analysis such as trend, sensitivity, and earned value analysis, among others.

How does the Risk Reassessment contribute to the assessment of the effectiveness of the risk response actions?

Risk reassessment allows for the review and update of risk information, enabling project teams to determine whether the risk response actions have effectively minimized the project risks.

How does a lessons-learned report contribute to the assessment of the effectiveness of risk response actions?

A lessons-learned report provides retrospective insight into what worked and what did not. This facilitates the improvement of future risk response actions based on lessons from past projects.

If your risk response actions are not aligning with the identified strategy, what should be the next course of action?

You should revise and adjust your risk response actions to fit within your identified strategy and meet the project objectives. This may involve redefining strategies or developing new response actions.

What is the purpose of earned value analysis in the assessment of the effectiveness of the risk response actions?

Earned value analysis measures the project performance against the project plan. It allows for the identification of variances in the project performance which may be due to the effectiveness or ineffectiveness of the risk response actions.

How does a risk audit assist in assessing the effectiveness of risk response actions?

A risk audit examines the efficiency and effectiveness of risk management procedures and ensures that risk responses are appropriate, effective, and will assist in meeting project objectives.

How does sensitivity analysis help in assessing the effectiveness of risk response actions?

Sensitivity analysis helps in understanding how different changes to a project’s variables can impact the project’s objective. It can provide feedback on the effectiveness of risk response actions by showing how changes in risk responses impact the project’s objectives.

How would one assess the impact of risk response actions on project objectives?

Through monitoring and control procedures, such as risk reviews and audits, performance tracking, and variance analysis. If the project is meeting its objectives, one can infer that the risk response actions have been effective.

What is a variance analysis in the context of assessing risk response actions?

Variance analysis is a quantitative method of assessing the effectiveness of risk response actions by comparing planned results with actual results. Differences or variances can indicate the effectiveness or ineffectiveness of the risk response actions.

How does a SWOT analysis assist in assessing the effectiveness of risk response actions?

A SWOT analysis (Strengths, Weaknesses, Opportunities, Threats) assists in identifying the strengths and weaknesses in risk response actions and provides a platform for realizing opportunities for improvement or identifying potential threats that require attention.

Why are frequent meetings necessary in assessing risk response actions?

Frequent meetings provide an opportunity for stakeholders and project team members to discuss and review the progress of the risk response actions. This helps to assess their effectiveness and make necessary modifications timely.

Can risk response actions be altered or phased out during the project if they are not effective?

Yes, one of the purposes of monitoring and controlling risk is to determine the effectiveness of risk response actions. If certain actions are found to be ineffective, they can be revised, enhanced, or phased out appropriately.

How is a trend analysis used in assessing the effectiveness of risk response actions?

Trend analysis is used to forecast future performance based on past results. In terms of assessing the effectiveness of risk response actions, it can help determine whether risk responses are improving the project over time or if modifications are required.

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