1. Most risk
acceptance policies rely on a contingency allowance for the project.
A contingency allowance is an amount of money the project will
likely need in the contingency reserve based on the impact,
probability, and expected monetary value of a risk event. Project
KIL has risks A and B. A has 25% probability of occurring and a
negative impact of -$50 while B has 45% probability of occurring and
a negative impact of -$90. What is the expected monetary value (Ex$V)
for risk A?
A. -$40.50
B. -$1250
C. -$12.50
D. $12.50
Answer: C
Explanation: The expected monetary value (Ex$V) for risk A is
calculated by 0.25 x -$50 = -$12.50
2. Procurement planning is the process of identifying which part of
the project should be procured from resources outside of the
organization. Which of the following refers to market condition
evaluation?
A. defines the project work and only the required work to complete
the project
B. defines the details and requirements for acceptance of the
project
C. needed to determine what products and services are available and
from whom and on what terms and conditions they are available
D. used to rate and score proposals from the sellers
Answer: C
Explanation: An evaluation of the marketplace is needed to determine
what products and services are available and from whom and on what
terms and conditions they are available.
3. Christian Zininski is the project manager of LOP Project. During
the procurement process, his project assistant identified that the
project has to depend on three procurement sources: HUH Limited, JI
Limited, and GIG Limited, which he described as an oligopoly. Which
of the following best describes the project’s market for materials?
A. Only GIG Limited and HUH Limited want to contract with
Christian’s performing organization, POLL Agency.
B. Only GIG Limited is the qualified seller that exists in the
marketplace.
C. The performing organization, POLL Agency, prefers to contract
with JI Limited only.
D. There are very few sellers and the actions of GIG Limited will
have a direct effect on the other seller's prices and the overall
market condition.
Answer: D
Explanation: Oligopoly: There are very few sellers and the actions
of one seller will have a direct effect on the other seller's prices
and the overall market condition.
4. Rose Hale is the project manager of Project UR. Rose signed a
Cost-Reimbursable contract with Shirts, Ltd. regarding the
procurement of pre-screened T-shirts to be used for Project UR.
Which of the following describes a characteristic or possibility
that may occur in this type of contract?
A. This contract may provide incentives for meeting or exceeding
contract requirements such as meeting deadlines.
B. This agreement does not procure or specify a firm quantity of
supplies (other than a minimum or maximum quantity) and that
provides for the issuance of orders for the delivery of supplies
during the period of the contract
C. The agreement defines a total price for the product the seller is
to provide.
D. The agreement requires Rose’s firm to assume the risk of cost
overruns.
Answer: D
Explanation: Cost-reimbursable contracts require the buyer to assume
the risk of cost overruns.
5. While working on a highly sensitive computer project at Company
W, Tori comes across a potential security leak in the system. If she
is right, millions of records in the database have already been
compromised, which will result in a press release causing a lot of
negative press. If she is wrong, she risks losing the respect of her
project team and stakeholders. What should Tori do according to the
Code?
A. Tori is not obligated to do anything unless she is sure there is
a problem.
B. Tori must disclosure her concerns clearly and succinctly to the
project’s stakeholders as soon as possible.
C. Tori can quietly investigate the situation further.
D. Tori can hint to her manager that there may be a problem.
ANS: B
Explanation: According to the Code, Project Managers must report on
projects accurately as possible, as well as report any possible
legal violations immediately.
6. Cost-Reimbursable Contracts pay the seller for the product. In
the payment to the seller there is a profit margin-the difference
between the actual costs of the product and the sales amount. The
actual costs of the product fall into two categories. Which of the
following refers to indirect costs?
A. costs that have fixed and variable elements
B. costs attributed to the cost of doing business
C. costs of production that vary directly with output
D. costs of production that do not vary with output
Answer: B
Explanation: Indirect costs: costs attributed to the cost of doing
business. Examples include utilities, office space, and other
overhead costs.
7. As the project manager of the new Project XZA, you have to decide
whether to create a new web application in-house or send the project
out to a developer. The outsource developer you would use quotes the
project cost at $175,000. Based on previous work with this company,
you are 85% certain they will finish the work on time. Your in-house
development team quotes the cost of the work as $165,000. Again,
based on previous experience with your in-house developers, you feel
75%t certain they can complete the work on time. Which of the
following quantitative risk analysis approaches should you use here?
A. Continuous probability distribution
B. Sensitivity analysis
C. Use the Decision Tree
D. Project Simulation
Answer: C
Explanation: Decision Tree: a method to determine which of two
decisions is the best to make.
8. The project manager will rely on several
pieces of information to prepare for team development. Which of the
following corresponds to the image below?
A. Project Plan
B. Responsibility Assignment Matrix (RAM)
C. Resource histogram
D. Staffing Management histogram
Answer: C.
Explanation: Management
may also want to see a resource histogram so they may plan
employees' time and activities accordingly.
9. Nina
Gouldman is the project manager of Ken Publishing. She’s currently
planning the communication requirements of a new project, Project
Mag. When should she accurately assess stakeholder information
needs?
A. At the middle phase of the project. Stakeholder demands during
the first half of the project will accurately assess what kind of
information stakeholders really need and how often they need it.
B. Right after the project has started. This will help Nina
accurately estimate the kind of information that stakeholders
actually need.
C. Early in the project, after evaluating the project constraints
and assumptions.
D. Early in the project, before exploring communication modalities.
Answer: D.
Explanation: Accurately assessing stakeholder information needs must
be completed early in the project, before exploring communication
modalities.
10. The BAYAG Project Management Company designated Ken Toothe to be
the project manager of the Pookey Project. Ken’s project team has
identified BAYAG’s contractual obligations to the project’s sponsors
as project constraints. What should Ken do in order to determine if
extra resources will be needed to handle the communications in this
project?
A. Call the sponsor’s company and inquire on the communication
modalities they prefer to be used when communicating with them.
B. Evaluate BAYAG’s available communication channels
C. Send a notice to BAYAG’s communications office and remind them of
their responsibilities regarding the communication requirements of
the sponsor contract. Offer an extra hand if they need more
communication resources for this obligation.
D.
Evaluate the requirements of the contract against the demands of the
project staff.
Answer: D
Explanation: The requirements of the contract should be evaluated
against the demands of the project staff to determine if extra
resources will be needed to handle the communications.
11. Durdo Schmitt is the project manager for 5 new projects. He is
currently in the planning stage of risk management. After
identifying all of the stakeholders in these 5 projects, he decided
to rank the major stakeholders of the 5 new projects according to
their expected risk tolerance functions. Which of the following
stakeholders will have a low risk tolerance?
A. Orphaned children that will be entertained by Project FUN for
Orphans (Creation of a new playground at the Gitamos Orphanage)
B. Single mothers who will rely on Project Sit (Free babysitting
services or single mothers who work)
C. Members of a local little baseball league who will rely on
Project Grass (Free baseball field set up services)
D. Death row convict and his/her family members who will depend on
Project Death Row (Providing transportation for families and kin of
death row convicts during the convict’s execution day)
Answer: D
Explanation: Choice D is a matter of life and death while the other
choices are not.
12. Jordyn has just told her Project Manager that a sudden problem
has come up between two critical project team members, although they
are about to make a joint presentation to the sponsor. They are
arguing over a situation that has little to do with the project, but
each is convinced that he is absolutely right and the other is
absolutely wrong. Jordyn asks the Project Manager to intervene,
especially in light of the upcoming project presentation, but she
throws her hands in the air and says: “I simply cannot deal with
this right now!” What has she done?
A. She has made a compromise.
B. She has smoothed over the issue.
C. She has withdrawn.
D. She has solved the problem.
Answer: C
Explanation: Withdrawing involves walking away from the problem.