The project manager should have implemented the communications management plan properly to avoid this situation. The communications management plan is a component of the project management plan that defines how the project information will be communicated to the stakeholders, such as the frequency, format, content, and methods of communication. The project manager should have followed the communications management plan to inform the CEO and other relevant stakeholders about the new tax policies and their impact on the project cost, as well as the updated risk register and the proposed risk responses. This would have enabled the project manager to manage the expectations of the stakeholders, address their concerns, and seek their support and approval for the project continuation. The project manager should have also used effective communication skills, such as active listening, feedback, and conflict resolution, to ensure a clear and mutual understanding of the project status and issues. By communicating the project information properly, the project manager could have avoided the surprise and potential cancellation of the project by the CEO. References: PMBOK Guide, 6th edition, section 10.1.3.1, page 377, PMP Exam Prep, 10th edition, page 368