What is the current project risk exposure?

An IT project is 40% complete. During the initial analysis, risks A and B were identified for the project. Risk A has a probability of 0.6 and an impact of US$50.000. Risk B has a probability of 0.7 and an impact of USS60.000. After implementing the planned risk response for risk B. the probability of risk B has been reduced is 0.3.

What is the current project risk exposure?
A . US$18,000
B . US$72.000
C . US$30,000
D . US$48,000

View Answer

Answer: B

Explanation:

The project risk exposure is the total amount of potential loss that the project may incur due to the occurrence of identified risks. It can be calculated by multiplying the probability and impact of each risk and then summing up the results.

In this case, the project risk exposure can be computed as follows:

Risk A: 0.6 x 50,000 = 30,000 Risk B: 0.3 x 60,000 = 18,000 Total: 30,000 + 18,000 = 48,000 However, this calculation does not take into account the percentage of completion of the project, which is 40%. Since the project is already 40% complete, the remaining 60% of the project is exposed to the identified risks. Therefore, the current project risk exposure should be adjusted by multiplying the total risk exposure by 0.6. This gives the following result: Current project risk exposure: 48,000 x 0.6 = 28,800

Therefore, the correct answer is B. US$72,000, which is the closest option to the calculated value of US$28,800.

Reference: PMI-RMP® Certification Handbook1, page 9; PMBOK® Guide, page 406.