PMP Exam Question 124

Aligned with PMBOK 6th Edition®.

Risk Response Strategies :

There is a high priority opportunity that could increase the profitability of your project by using technology upgrades to reduce cost and duration. The project sponsor and you want to reassure that this benefit is captured by increasing the probability of occurrence to 100%. Which risk response strategy are you using?

A. Escalate.
B. Exploit.
C. Share.
D. Accept.

2 responses on "PMP Exam Question 124"

  1. PMP Solution 124

    A. Escalate risk response strategy is appropriate when the project team or the project sponsor agrees that an opportunity is outside the scope of the project or that the proposed response would exceed the project manager’s authority. Escalated opportunities are managed at the program level, portfolio level, or other relevant part of the organization, and not on the project level.

    C. Sharing involves transferring ownership of an opportunity to a third party so that it shares some of the benefit if the opportunity occurs. It is important to select the new owner of a shared opportunity carefully so they are best able to capture the opportunity for the benefit of the project.

    D. Accepting an opportunity acknowledges its existence but no proactive action is taken. This strategy may be appropriate for low-priority opportunities, and it may also be adopted where it is not possible or cost-effective to address an opportunity in any other way.

    The exploit strategy may be selected for high-priority opportunities where the organization wants to ensure that the opportunity is realized. This strategy seeks to capture the benefit associated with a particular opportunity by ensuring that it definitely happens, increasing the probability of occurrence to 100%. Examples of exploiting responses may include assigning an organization’s most talented resources to the project to reduce the time to completion, or using new technologies or technology upgrades to reduce cost and duration. Therefore, right answer is B. [PMBOK 6th edition, Page 444] [Project Risk Management]

    Cheers

  2. A: Escalate is used when the threat/opportunity is outside the authority of the Project Manager. Escalated risks are managed on program or Portfolio level.
    B: Exploit is used for opportunities with high impact, when Organizations want to increase the probability of such opportunities to happen and want to ensure that they will 100% happen.
    C: Share is used for opportunities – transferred to third parties, which are the best to capture the opportunity for the benefit of the project.
    D: Accept is used for low priority threats/opportunities. The project team acknowledges their existence, but no proactive action is taken. The risk is reviewed periodically to check if its magnitude has changed.
    The right answer is B (PMBOKGuide 6th Edition, Chapter 11.5.2.5)

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