ExpertHard1 markMultiple Choice
PMP · Question 11 · Task 3: Assess and manage risks
A project has a 30% chance of a delay costing $20,000 and a 20% chance of a scope reduction saving $10,000. What is the Expected Monetary Value (EMV) of these uncertainties?
A project has a 30% chance of a delay costing $20,000 and a 20% chance of a scope reduction saving $10,000. What is the Expected Monetary Value (EMV) of these uncertainties?
Answer options:
A.
-$6,000
B.
-$4,000
C.
$4,000
D.
-$8,000
How to approach this question
Calculate EMV for each risk separately (Threat = negative, Opportunity = positive) and sum them.
Full Answer
B.-$4,000✓ Correct
EMV is the sum of probability-weighted impacts. Threat: 0.3 * -20k = -6k. Opportunity: 0.2 * +10k = +2k. Sum = -4k.
Common mistakes
Forgetting that costs are negative values.
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