Quantitative Risk Analysis Process
Question
Gary is the project manager for his project.
He and the project team have completed the qualitative risk analysis process and are about to enter the quantitative risk analysis process when Mary, the project sponsor, wants to know what quantitative risk analysis will review.
Which of the following statements best defines what quantitative risk analysis will review?
Answers
Explanations
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A. B. C. D.A.
Quantitative risk analysis is a process that involves numerical analysis and modeling techniques to determine the probability and impact of identified risks on project objectives. In this process, the identified risks are prioritized based on their likelihood of occurrence and potential impact. The goal of quantitative risk analysis is to provide a more accurate and precise understanding of the potential risks and their impact on project objectives, in terms of schedule, cost, and performance.
Option A: The statement is not entirely accurate as the quantitative risk analysis process primarily focuses on identifying the likelihood and impact of risks rather than the competing demands of the project.
Option B: This statement refers to risk response planning, which occurs after the quantitative risk analysis process. Risk response planning uses the results of the risk identification and analysis process to develop strategies to mitigate, transfer, avoid, or accept the identified risks.
Option C: This statement correctly defines the focus of the quantitative risk analysis process. Quantitative risk analysis examines the probability and potential impact of risks on project objectives, and it provides a numerical representation of the level of risk associated with each identified risk.
Option D: While determining the true cost of identified risks is an essential aspect of risk analysis, it is not the sole focus of the quantitative risk analysis process. This process aims to provide a comprehensive understanding of the risk by evaluating its probability and impact.
Therefore, the best answer to the question is C: "The quantitative risk analysis process will review risk events for their probability and impact on the project objectives."
