PMI-RMP · Question #335
Which of the following will ultimately determine risk thresholds?
The correct answer is B. The risk appetite of the key stakeholders. Risk thresholds define the boundaries of acceptable risk variation - the point at which a risk becomes significant enough to require action. These thresholds are ultimately set by the risk appetite of key stakeholders, because risk appetite reflects how much uncertainty an…
Question
Which of the following will ultimately determine risk thresholds?
Options
- AThe absolute value of the consequence
- BThe risk appetite of the key stakeholders
- CThe practice standard for risk management
- DThe project manager
How the community answered
(24 responses)- A4% (1)
- B92% (22)
- D4% (1)
Explanation
Risk thresholds define the boundaries of acceptable risk variation - the point at which a risk becomes significant enough to require action. These thresholds are ultimately set by the risk appetite of key stakeholders, because risk appetite reflects how much uncertainty an organization or its decision-makers are willing to tolerate in pursuit of their objectives. Stakeholders with high risk appetite accept wider thresholds; those with low risk appetite set tighter ones. The absolute value of the consequence (A) informs the analysis but does not set the threshold - the same consequence may be acceptable to one stakeholder and unacceptable to another. Practice standards (C) provide guidance but do not replace stakeholder judgment. The project manager (D) facilitates but does not unilaterally define thresholds.
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