A risk manager is facilitating a session to define a response to a critical risk.

The correct answer is C. Perform decision tree analysis.

The question asks how to determine which response options are cost effective . A decision tree analysis is specifically useful when comparing alternative actions under uncertainty, especially where different choices have different probabilities, costs, and outcomes. It helps evaluate expected value and supports selection of the most economically sensible response.

Why the other options are incorrect:

A. Complete a comprehensive trend analysis. Trend analysis examines patterns over time, but it is not the best tool for comparing the cost effectiveness of alternative risk responses.

B. Validate assumptions and constraints analysis. This can support understanding of the situation, but it does not directly compare response alternatives financially.

D. Conduct a variance analysis. Variance analysis compares actual performance to planned performance. It is not the best method for selecting among possible response options.

Reference-aligned basis:

This answer is consistent with standard project risk analysis methods that use decision trees to compare response alternatives under uncertainty.