Business Finance Endterm Quiz #3

Risk identification is a one-time activity performed at the very beginning of a project and rarely revisited.

• True
• False

A risk with a high probability but low impact typically requires more immediate and extensive mitigation efforts than a risk with low probability but catastrophic impact.

• True
• False

Qualitative risk analysis assigns numerical values to risk probability and impact, allowing for statistical modeling.

• True
• False

The purpose of risk mitigation is to entirely eliminate all identified risks from a project.

• True
• False

Accepting a risk means the project team will develop a detailed contingency plan to be executed if the risk occurs.

• True
• False

A risk register serves as a central repository for documenting identified risks, their assessment, and planned responses.

• True
• False

Transferring a risk always involves purchasing insurance to cover potential financial losses.

• True
• False

Project managers should only focus on identifying negative risks, as positive risks (opportunities) do not require management.

• True
• False

A risk's likelihood and impact are the two primary factors used to prioritize it in a risk matrix.

• True
• False

Continuous risk monitoring is essential because new risks can emerge, and existing risks can change in severity or likelihood throughout the project lifecycle.

• True
• False