The Overall Project Risk Factor Is Known to Be 0

question 31

Multiple Choice

The overall project risk factor is known to be 0.5.The probability of dependency failure is twice the probability of complexity failure and four times the probability of maturity failure.The consequence of performance failure is twice the consequence of reliability failure,four times the consequence of schedule failure and eight times the consequence of cost failure.What is the difference between the probability of maturity failure and the consequence of cost failure? $$\begin{array} { | l | l | l | l | } \hline \text { Maturity } & \mathrm { X } & \text { Cost } & \mathrm { Y } \\\hline \text { Complexity } & 2 \mathrm { X } & \text { Schedule } & 2 \mathrm { Y } \\\hline \text { Dependency } & 4 \mathrm { X } & \text { Reliability } & 4 \mathrm { Y } \\\hline & & \text { Performance } & 8 \mathrm { Y } \\\hline\end{array}$$

• A) 0.026
• B) 0.033
• C) 0.041
• D) 0.048

---

Definitions:

Profit-Maximizing Output

The quantity of output at which a firm achieves the maximum possible profit, determined where marginal revenue equals marginal cost.

Economic Profit

The difference between total revenue and total costs, including both explicit and implicit costs.

Perfectly Competitive Firm

A company that operates in a market where there are many buyers and sellers, no barriers to entry or exit, and the firm sells a homogeneous product.

MR

The extra revenue that a firm gains when it sells an additional unit of output, essentially another term for marginal revenue.