Project Management Question Bank
for Exam preparation

Q2. Ideally the relationship between a project manager and a business analyst should be:

1. Business analyst should directly report to the project manager
2. A collaborative partnership
3. Project manager should directly report to the business analyst
4. Business analyst must audit the project manager

Q3. You are a project manager for a major telecommunications network upgrade with a net present value (NPV) of US $10,000,000. You are heavily dependent on a third party vendor for your project and your contract office informs you that there is a 30 percent chance that the vendor will go out of business at the end of the quarter. If that occurs, your project will incur a US $3,000,000 cost overrun due to rework. There is also a 30 percent chance that a new legislation will pass that will decrease government oversight of your team's work. If this legislation passes, you estimate that your project will save US $1,600,000 in time delays. Lastly, your technical lead indicates that there is 20 percent chance that a new software package will be available by month end that could save US $1,800,000 in testing time. If available, the software will cost US $500,000 to procure, install and train. What is the total expected monetary value of these three risk events?

1. $60,000
2. $1,640,000
3. $5,900,000
4. $160,000 88

Q4. In which of the following contract types does the seller have the most cost risk?

1. Fixed price incentive fee (FPIF)
2. Time and material (T&M)
3. Cost plus award fee (CPAF)
4. Cost plus percentage of costs (CPPC).

Q5. A project manager is estimating the project duration and finds that the only information available to him is a previous project that was quite different from the current one. However, some portions of the previous project were similar to the current one. Which of the following tools is the project manager likely to use to compare current project's activity durations with the similar previous activities?

1. Analogous estimating
2. Program Evaluation and Review Technique (PERT)
3. Three-point estimates
4. Parametric estimating

Q6. You have just received an invoice from your supplier that contains some uncertified items. Payments to the supplier are processed through your corporate accounts payable system only after certification of satisfactory work by the project quality control specialist. What should you do?

1. Process the supplier’s invoice since this is your liability
2. Call the supplier and obtain more information
3. Ask the supplier to stop all deliveries until the matter has a resolution
4. Seek judicial arbitration

Q7. You just sat through an exhausting change control meeting discussing a change in scope to the project you have worked on for the past seven months. After lengthy discussion, the change in scope was approved. As the Project Manager, you should now update all the following documentation, except:

1. Scope Baseline
2. Requirements documentation
3. WBS Dictionary
4. Project charter

Q8. If an investment in a project returns 15 percent annually, how much should you invest to get $5 million by the end of the fifth year?

1. 2485884
2. 2857143
3. 2501376
4. 2685292

Q9. Which of the following BEST describes what is included in a staffing management plan?

1. A plan regarding what details about the project should go to whom and when the details need to be sent.
2. How the team will implement the plans for ensuring the project will satisfy the needs for which it was undertaken
3. When and how human resources will be brought into and taken off the project team
4. If independent estimates are needed, who will prepare them and when.

Q10. The banks in the Ukraine have raised the annual interest rates sharply to 30 percent. You have the option to invest your money either in Ukrainian banks or to build a small factory for a client. The total cost of building the factory will be $12 million but it will spread evenly over one year ($1 million payable by the end of each month for the next 12 months). The client will make a payment of $3.9 million at the end of each quarter from the start of the project. Which of the following is the best option (if you are only considering the return on investment)?

1. Build the factory for the client
2. Invest the money in the bank for a year
3. Both options offer the same payoff
4. Information given is insufficient to determine the best option