PK0-005 Project Life Cycle Practice Question
A project manager has identified a risk that could cause a $50,000 loss with a 20% probability. What is the Expected Monetary Value (EMV) of this risk?
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
$10,000
EMV = Probability × Impact = 20% × $50,000 = $10,000. This is a quantitative risk analysis technique.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
$50,000
Why it's wrong here
$50,000 is the full impact if the risk occurs, ignoring the 20% probability entirely. It is tempting because it is the headline loss figure, but EMV requires weighting by likelihood; $50,000 would be the correct answer only if the risk were certain to occur.
- ✓
$10,000
Why this is correct
EMV quantifies risk exposure by multiplying monetary impact by probability: $50,000 × 0.20 = $10,000. This figure lets the project manager weigh the risk against mitigation costs, satisfying the stem's requirement for a single expected monetary value.
- ✗
$40,000
Why it's wrong here
$40,000 subtracts the 20% probability from the impact instead of multiplying, which is not how EMV is calculated. It is tempting because it uses both given numbers, but the correct operation is $50,000 × 0.20 = $10,000, a probability-weighted exposure.
- ✗
$25,000
Why it's wrong here
EMV multiplies impact by probability, giving $50,000 × 0.20 = $10,000, so $25,000 overstates the exposure. It is tempting because it resembles half the impact, but EMV is a probability-weighted figure, not an arbitrary fraction of the loss.
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Written by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
This PK0-005 practice question is part of Courseiva's free CompTIA certification practice question bank. Courseiva provides original exam-style practice questions with explanations, topic-based practice, mock exams, readiness tracking, and study analytics to help learners prepare for the PK0-005 exam.