1. A project risk budget was approved by considering high impact risk/ high potential risk. During execution, a risk has occurred which is in risk register but not in the budget. PM response should be:
A. Execute the risk response plan using the available budget.
B. Conduct impact analysis and submit the CR to increase the budget if necessary.
I choose B but answer is A which doesn't make sense for me.
This is a great question that really reflects how you have to tease out the scenario from the question. Let's rephrase the question: A project risk budget (CONTINGENCY RESERVES) was approved which included only high impact/high potential risks (only those risks got contingency reserves). During execution, another type (not high impact) of risk was triggered. This was not in the contingency reserves, however, you can use the available budget (MANAGEMENT RESERVES), this seems like answer A.
Answer B seems like it can be eliminated because a CR would more than likely be needed to move the management reserves into the cost baseline, not to increase the budget. In fact, the project budget would stay the same.
This is a great PMP exam question because the question is vague, you could argue for either answer, and you don't feel terribly comfortable picking either answer. That being said, answer A is what I would pick.
I didn't understand question #2.
