Correction for Sunday's PMP Exam Sample Question

Published: Tue, 04/12/11

 
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In this issue...

Cornelius Fichtner, PMP,

We are sending this email because The latest issue of
the PM Exam Tips Newsletter which we sent over the weekend had a typo. We apologize for the confusion.

We have rectified the error in the Sample PMP Exam Question and Solution. Please see below.

See you in the next issue of the PM Exam Tips Newsletter!

Warm Regards,
Cornelius Fichtner, PMP

President, OSP International LLC

Sample PMP Exam Question
You are managing a construction project. You have just been intimated that it is likely to rain heavily during the next week. This can delay your project by a week and you will miss a deadline. This risk will cost you a potential impact of $50,000 if it happens. The probability of the occurrence of this risk is 75%. What is the expected value for this risk?   

A. 37500                                    
B. -37500                                    
C. 50000                                    
D. -50000                                    
                                            
Hint: Calculate the expected value by EMV formula. Also note that threats are treated as negative numbers.                                        
                                  
Solution


The correct answer is: B


Reference: PMBOK4 - pg:298

Explanation: EMV for a risk is calculated by multiplying the value of its impact by its probability of occurrence. This will result in 75% * -$50,000 = -$37,500. Choice B is the correct answer to this question.                                        
                    
                    
                          

 
 

 
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