According to the PMBOK Guide, risk management is the process of identifying, analyzing, and responding to project risks. Project risks can be either threats or opportunities. A threat is a negative event or condition that may adversely affect the project objectives, while an opportunity is a positive event or condition that may enhance the project objectives. In this question, the new law is an external risk that poses a threat to the current production processes, but also an opportunity to introduce new products that can meet the customer needs and increase the market share. The project manager should inform the management of this risk and opportunity, and share the proposed products that can take advantage of the situation. This way, the project manager can align the project objectives with the organizational strategy, and seek the support and approval of the management for the changes. This is also consistent with the stakeholder management process, which involves identifying, analyzing, and engaging the stakeholders throughout the project life cycle. The management is a key stakeholder that has high power and interest in the project outcome, and should be kept informed and satisfied. Therefore, option C is the best answer. References: (Professional in Business Analysis Reference Materials source and documents)
* PMBOK Guide, 6th edition, Chapter 11: Project Risk Management, pages 397-455
* PMBOK Guide, 6th edition, Chapter 13: Project Stakeholder Management, pages 513-542
* Free PMP Questions and Answers - Are You Ready for PMP Exam?