The following PMP® exam sample question is taken from the Free PMP Exam Simulator at http://free.pm-exam-simulator.com - The answer is at the very bottom:


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Tim is the project manager working on an electronic manufacturing project. In his project he wants to establish a warranty for some of the precision parts he is buying. What risk response strategy is he using?

A.) Mitigate

B.) Avoid

C.) Accept

D.) Transfer

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Hint: Tim is shifting the negative impact of the risk.

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ANSWER AND EXPLANATION:

The correct answer is D.
Explanation: Risk transfer requires shifting some or all of the negative impact of a threat, along with the ownership of the response. Taking out insurance or a warranty transfers the risk from the owner to the other party.
Reference: PMBOK4 - pg:303