Know Facts, Terms and Concepts Relating to the Portfolio Delivery Cycle MOP-PRACTITIONER Practice Questions (Page 5)

Questions 21–25

1. 21foundation · easy

   What is the first step in the risk management process?

   • ARespond to risks
   • BAssess risks
   • CIdentify risks
   • DMonitor risks
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2. 22expert · hard

   A portfolio manager has identified a high-impact risk: a key supplier may go out of business. The risk is rated as high likelihood and high impact. The governance board is risk-averse and wants to eliminate the risk. However, the only alternative supplier is significantly more expensive. What is the most appropriate response?

   • ATransfer the risk by purchasing insurance.
   • BAccept the risk and continue with the current supplier, as the alternative is too costly.
   • CAvoid the risk by terminating all projects that depend on the supplier.
   • DMitigate the risk by developing a contingency plan and exploring partial alternatives.
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4. 23expert · hard

   A portfolio manager is reviewing the risk register and notices that several projects have similar risks related to technology obsolescence. Each project has its own mitigation plan. What is the most effective way to manage these risks at the portfolio level?

   • AIncrease the contingency budget for each project to cover potential impacts.
   • BLeave the risks with the projects, as they are project-specific.
   • CAggregate the risks to understand the cumulative exposure and coordinate a portfolio-level response.
   • DEscalate the risks to the governance board for a decision.
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5. 24expert · hard

   A portfolio has a budget of $10M. A new opportunity has emerged that could generate significant benefits but requires $3M in additional funding. The portfolio is already at full budget. The CFO is willing to reallocate funds but wants to minimize risk. What is the most appropriate financial decision?

   • AReallocate funds from projects with the lowest strategic contribution and highest risk.
   • BApprove the new opportunity and reduce funding for all existing projects by 30%.
   • CReject the opportunity because the portfolio is at full budget.
   • DBorrow funds from the next year's budget to fund the opportunity.
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6. 25expert · hard

   A portfolio has a fixed annual budget. Mid-year, a new regulatory requirement emerges that demands immediate action. The portfolio manager must fund this new work without exceeding the budget. What is the most appropriate financial management action?

   • ADelay the regulatory work until the next budget cycle.
   • BReallocate funds from lower-priority projects to the regulatory work, and monitor the impact.
   • CRequest additional budget from the board, explaining the regulatory need.
   • DReduce the scope of all existing projects to free up funds.
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