Hello everyone! Here is this week's free PMP exam sample question from the PM Exam Simulator.

Question:

Tim is working on an electronic manufacturing project and 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.

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.