PMP Question #972: Real Exam Question with Answer & Explanation

Question

During a risk management meeting, most of the project team members use a computer to iterate the quantitative risk analysis model numerous times. There will be a cumulative probability distribution (S-curve) representing the probability of achieving any particular outcome. Which method should the project manager use to assess and manage project risks?

Options

• AInfluence diagrams
• BSensitivity analysis
• CDecision tree analysis
• DMonte Carlo analysis

Explanation

The project team is performing a quantitative risk analysis using iterative simulations to generate a cumulative probability distribution (S-curve), which is characteristic of Monte Carlo analysis.

Common mistakes.

• A. Influence diagrams visually represent decisions, uncertainties, and objectives but do not involve iterating models to produce probability distributions.
• B. Sensitivity analysis determines which project risks have the most potential impact by examining the extent to which the uncertainty of each project element affects the outcome, typically displayed as a tornado diagram.
• C. Decision tree analysis is a diagrammatic technique used to evaluate possible outcomes and their probabilities when making choices under uncertainty, but it does not involve iterating a model numerous times to generate an S-curve.

Concept tested. Quantitative risk analysis; Monte Carlo simulation

Reference. https://www.pmi.org/pmbok-guide-standards/foundational/pmbok/risk-management/quantitative-risk-analysis

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