You are the project manager of the KJH Project and are working with your project team to plan the risk responses. Consider that your project has a budget of $500,000 and is expected to last six months. Within the KJH Project you have identified a risk event that has a probability of .70 and has a cost impact of $350,000. When it comes to creating a risk response for this event what is the risk exposure of the event that must be considered for the cost of the risk response? 

Answer options:

A. The risk exposure of the event is $350,000.
B. The risk exposure of the event is $500,000.
C. The risk exposure of the event is $850,000.
D. The risk exposure of the event is $245,000.

D

The risk exposure for this event is found by multiplying the risk impact by the risk probability. Risk Exposure is a straightforward estimate that gives a numeric value to a risk, enabling different risks to be compared. Risk Exposure of any given risk = Probability of risk occurring x impact of risk event = 0.70 * 350,000 = 245,000 Incorrect Answers: A: $350,000 is the impact of the risk event. B: $500,000 is the project`s budget. C: $850,000 is the project`s budget and the risk`s impact.