What type of risk response?
Correct Answer for the Question – What type of risk response? is given below
You are the project manager of a large construction project. Part of the project involves the wiring of the electricity in the building your project is creating. You and the project team determine the electrical work is too dangerous to perform yourself, so you hire an electrician to perform the work for the project. This is an example of what type of risk response?Answer option A is correct.Whenever the risk is transferred to someone else, it is an example of the transference risk response. Transference usually has a fee attached to the service provider that will own the risk event.TransferenceTransference is a strategy to mitigate negative risks or threats. In this strategy, consequences and the ownership of a risk is transferred to a third party. This strategy does not eliminate the risk but transfers responsibility of managing the risk to another party. Insurance is an example of transference.Answer option B is incorrect. Mitigations are activities to reduce the probability and/or impact of a risk event.Answer option D is incorrect. Acceptance is when the risk event is accepted and allowed to happen. This response is typical for smaller risk events.Answer option C is incorrect. Avoidance is action to avoid the risk event. This example is not avoidance because the danger of electricity does not go away, as the electrician now owns the risk event.Reference: The Project Management Body of Knowledge, Fifth edition, Section 184.108.40.206, Page 344 Chapter: Quality and Risk ManagementObjective: Risk Modeling and Response
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The Question – What type of risk response? has been answered correctly and answers for the question is Transference
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