SPM Chapter 11

William Ibbs and Young H. Kwak’s study revealed that the ____ industry had the lowest level of project management maturity in the area of risk management.
a.engineering/construction
b.telecommunications
c.information systems
d.high-tech manufacturing
c
William Ibbs and Young H. Kwak’s study revealed that the ____ industry had the lowest level of project management maturity in the area of quality management.
a.engineering/construction
b.telecommunications
c.information systems
d.high-tech manufacturing
c
KLCI Research Group’s 2001 survey revealed that ____ percent of the participants said they had procedures in place to identify and assess risk.
a.75
b.87
c.97
d.99
c
KLCI Research Group’s 2001 survey revealed that ____ percent identified anticipating and avoiding problems as the primary benefit of risk management.
a.60 c.89
b.80 d.99
b
KLCI Research Group’s 2001 survey revealed that ____ percent of the organizations surveyed had a Project Management Office.
a.64
b.75
c.85
d.94
a
KLCI Research Group’s 2001 survey revealed that the most frequently cited benefit from software risk management practices is to ____.
a.prevent surprises
b.improve ability to negotiate
c.meet customer commitments
d.anticipate/avoid problems
d
Utility rises at a decreasing rate for a ____ person.
a.risk-seeking
b.risk-averse
c.risk-neutral
d.risk-indifferent
b
Those who are ____ have a higher tolerance for risk, and their satisfaction increases when more payoff is at stake.
a.risk-seeking
b.risk-averse
c.risk-neutral
d.risk-indifferent
a
A ____ person achieves a balance between risk and payoff.
a.risk-seeking
b.risk-averse
c.risk-fearing
d.risk-neutral
d
There are ____ major processes involved in risk management.
a.three
b.four
c.five
d.six
d
.____ involves deciding how to approach and plan the risk management activities for the project.
a.Identifying risks
b.Planning risk management
c.Performing qualitative risk analysis
d.Performing quantitative risk analysis
b
.____ involves determining which risks are likely to affect a project and documenting the characteristics of each.
a.Identifying risks
b.Planning risk management
c.Performing qualitative risk analysis
d.Performing quantitative risk analysis
a
.____ involves prioritizing risks based on their probability and impact of occurrence.
a.Performing qualitative risk analysis
b.Planning risk management
c.Planning risk responses
d.Performing quantitative risk analysis
a
.____ involves numerically estimating the effects of risks on project objectives.
a.Performing qualitative risk analysis
b.Planning risk responses
c.Planning risk management
d.Performing quantitative risk analysis
d
____ involves taking steps to enhance opportunities and reduce threats to meeting project objectives.
a.Performing quantitative risk analysis
b.Planning risk responses
c.Monitoring and controlling risk
d.Performing qualitative risk analysis
b
____ involves monitoring identified and residual risks, identifying new risks, carrying out risk response plans, and evaluating the effectiveness of risk strategies throughout the life of the project.
a.Performing quantitative risk analysis
b.Planning risk responses
c.Monitoring and controlling risk
d.Performing qualitative risk analysis
c
____ are predefined actions that the project team will take if an identified risk event occurs.
a.Fallback plans
b.Contingency reserves
c.Contingency plans
d.Contingency allowances
c
____ are developed for risks that have a high impact on meeting project objectives, and are put into effect if attempts to reduce the risk are not effective.
a.Fallback plans
b.Contingency reserves
c.Contingency plans
d.Contingency allowances
a
According to the Standish Group’s success potential scoring sheet, ____ has the highest relative importance.
a.executive management support
b.clear statement of requirements
c.proper planning
d.user involvement
d
“If the information technology project is to produce a new product or service, will it be useful to the organization or marketable to others?” applies to which risk category?
a.Financial risk
b.Technology risk
c.Structure/process risk
d.Market risk
d
“Will the project meet NPV, ROI, and payback estimates?” applies to which risk category?
a.Financial risk
b.Technology risk
c.Structure/process risk
d.Market risk
a
“Is there a project champion?” applies to which risk category?
a.Financial risk
b.Technology risk
c.Structure/process risk
d.People risk
d
In a risk breakdown structure, competitors, suppliers, and cash flow are categories that fall under ____ risk.
a.business
b.technical
c.organizational
d.project management
a
Poor conflict management, poor project organization and definition of responsibilities, and absence of leadership are risk conditions associated with the ____ project management knowledge area.
a.Integration
b.Quality
c.Time
d.Human Resources
d
Unenforceable conditions or contract clauses, and adversarial relations are risk conditions associated with the ____ project management knowledge area.
a.Integration
b.Quality
c.Procurement
d.Human Resources
c
____ is a fact-finding technique for collecting information in face-to-face, phone, e-mail, or instant-messaging discussions.
a.Brainstorming
b.SWOT analysis
c.The Delphi technique
d.Interviewing
d
A(n) ____ represents decision problems by displaying essential elements, including decisions, uncertainties, causality, and objectives, and how they influence each other.
a.risk breakdown structure
b.influence diagram
c.process flow chart
d.system flow chart
b
A project manager can chart the probability and impact of risks on a ____.
a.risk ranking chart
b.risk probability table
c.probability/impact matrix
d.risk assessment matrix
c
____ are/is a qualitative risk analysis tool, and in addition to identifying risks, it maintains an awareness of risks throughout the life of a project.
a.Risk factor analysis
b.Probability/impact matrices or charts
c.Risk registering
d.Top Ten Risk Item Tracking
d
A(n) ____ is a diagramming analysis technique used to help select the best course of action in situations in which future outcomes are uncertain.
a.decision tree
b.EMV
c.Monte Carlo analysis
d.watch list
a
____ analysis simulates a model’s outcome many times to provide a statistical distribution of the calculated results.
a.Decision tree
b.EMV
c.Monte Carlo
d.Watch list
c
What is the first step in a Monte Carlo analysis?

a. Determine the probability distribution of each variable.
b. For each variable, such as the time estimate for a task, select a random value based on the probability distribution for the occurrence of the variable.
c. Assess the range for the variables being considered.
d. Run a deterministic analysis or one pass through the model using the combination of values selected for each one of the variables.

c
____ involves eliminating a specific threat, usually by eliminating its causes.
a.Risk avoidance
b.Risk acceptance
c.Risk transference
d.Risk mitigation
a
____ involves shifting the consequence of a risk and responsibility for its management to a third party.
a.Risk avoidance
b.Risk acceptance
c.Risk transference
d.Risk mitigation
c
____ involves reducing the impact of a risk event by reducing the probability of its occurrence.
a.Risk avoidance
b.Risk acceptance
c.Risk transference
d.Risk mitigation
d
____ involves doing whatever you can to make sure the positive risk happens.
a.Risk exploitation
b.Risk sharing
c.Risk enhancement
d.Risk acceptance
a
____ involves allocating ownership of the risk to another party.
a. risk exploitation
b. risk sharing
c. risk enhancement
d. risk acceptance
b
____ involves changing the size of the opportunity by identifying and maximizing key drivers of the positive risk.
a. risk exploitation
b. risk sharing
c. risk enhancement
d. risk acceptance
c
____ applies to positive risks when the project team cannot or chooses not to take any actions toward a risk.
a. risk enhancement
b. risk acceptance
c. risk sharing
d. risk exploitation
b
____ risks are a direct result of implementing a risk response.
a. Primary
b. Tertiary
c. Secondary
d. Residual
c