Project Management Professional (PMP) — Question 722

A project team has identified a risk and wants to accept it as an opportunity to finish a project earlier than planned. The project manager realizes that the sponsor may not accept the risk since the sponsor is risk averse.

What should the project manager do?

Answer options

• A. Create a contingency reserve to cover the risk in order to ensure that the risk will be accepted.
• B. Conduct a Monte Carlo analysis to determine if the team will complete the project early.
• C. Explain to the sponsor that this is a nonevent type of risk and it will be fine to accept it.
• D. Convince the sponsor that this will cost less, ultimately resulting in more profit for the sponsor.

Correct answer: B

Explanation

The correct answer is B, as conducting a Monte Carlo analysis will provide a quantitative assessment of the risk and its potential benefits, which can help persuade the sponsor. The other options do not adequately address the sponsor's concerns or provide the necessary analysis to support the acceptance of the risk.