TOPIC: Free PMP® Exam Sample Question

You are developing the risk management plan for your project. In support of this process, you need to determine the acceptable level of overall project risk exposure.

What should you do first?

A. Determine the risk appetites of key project stakeholders
B. Consult the risk exposure register within the organizational process assets
C. Facilitate a brainstorming meeting to develop a comprehensive list of project risks
D. Develop a set of responses to individual project risks to mitigate overall project risk

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HINT: Which answer choice describes an activity associated with an element of the risk management plan?

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Answer and Explanation:
The correct answer is A.

The risk management plan is created as an output of the Plan Risk Management process. Stakeholder risk appetite is one of the elements which may be included in the risk management plan. The risk appetites of key stakeholders on the project are recorded in the risk management plan. In particular, stakeholder risk appetite should be expressed as measurable risk thresholds around each project objective. These thresholds will determine the acceptable level of overall project risk exposure. The incorrect answer choices represent activities which would not likely be conducted as part of the Plan Risk Management process. Therefore, among the available options, determining the risk appetites of key stakeholders is the best answer to the question asked.

Details for each option:

A. Correct. Stakeholder risk appetite should be expressed as measurable risk thresholds around each project objective. These thresholds will determine the acceptable level of overall project risk exposure.

B. Incorrect. 'Risk exposure register' is a made-up term.

C. Incorrect. A comprehensive list of project risks is developed as part of the Identify Risks process. Whereas, the question implies that the Plan Risk Management process is being conducted with the creation of the risk management plan. The risk management plan may include categories of risk but is not likely to contain a comprehensive list of project risks.

D. Incorrect. Responses to individual project risks are developed as part of the Plan Risk Responses process. However, the question suggests that the Plan Risk Management process is being performed with the creation of the risk management plan. Responses of individual project risks are not likely to be included in the risk management plan.

Reference: A Guide to the Project Management Body of Knowledge (PMBOK^® Guide) – Sixth Edition, Project Management Institute Inc., 2017, Page(s) 407