IST 352 Chapter 5
A cost resulting from the ongoing evolution and use of a system refers to a(n): A) recurring cost B) one-time cost C) incremental cost D) frequent cost
a
A major outcome and deliverable from the project initiation and planning phase that contains the best estimate of a project's scope, benefits, costs, risks, and resource requirements defines the: A) Baseline Project Plan B) Information Systems Plan C) Mission Statement D) Statement of Work
a
A peer group review of any product created during the system development process refers to: A) walkthrough B) feasibility assessment C) joint application discussion D) product evaluation
a
An assessment of the development group's understanding of the possible target hardware, software, and operating environments, system size, complexity, and the group's experience with similar systems should be included as part of: A) technical feasibility B) political feasibility C) operational feasibility D) schedule feasibility
a
Application software maintenance, new software and hardware leases, and incremental communications are examples of: A) recurring costs B) one-time costs C) incremental costs D) frequent costs
a
As a rule of thumb estimate, what percentage of the entire development effort should be devoted to the project initiation and planning process? A) between 10 and 20 percent B) less than 5 percent C) less than 10 percent D) between 20 and 30 percent
a
The objective of the project planning process is: A) the development of a Baseline Project Plan and Project Scope Statement B) the development of a Systems Service Request C) the development of entity relationship diagrams D) the development of transitional operations plans
a
The rate of return used to compute the present value of future cash flows refers to: A) discount rate B) investment rate C) transfer rate D) future cash flow rate
a
The ratio of the net cash receipts of the project divided by the cash outlays of the project, enabling tradeoff analysis to be made between competing projects is often referred to as: A) return on investment (ROI) B) break-even analysis (BEA) C) net present value (NPV) D) future value (FV)
a
The reduction of waste creation is an example of a(n): A) intangible benefit B) qualitative benefit C) tangible benefit D) operational benefit
a
To gain an understanding of the likelihood that all potential time frame and completion date schedules can be met and that meeting these dates will be sufficient for dealing with the needs of the organization is the purpose of: A) schedule feasibility B) operational feasibility C) technical feasibility D) political feasibility
a
Which of the following is NOT a major section of the Baseline Project Plan? A) design issues B) introduction C) system description D) feasibility assessment
a
A cost associated with project start-up and development or system start-up refers to a(n): A) recurring cost B) one-time cost C) incremental cost D) infrequent cost
b
A new system or the renovation of existing systems, user perceptions, and management commitment to the system are examples of which of the following risk factors? A) development group B) project structure C) project size D) user group
b
At a walkthrough meeting, the person (or group) who ensures that the work product meets the needs of the project's customers is referred to as the: A) coordinator B) user C) maintenance oracle D) standards bearer
b
At a walkthrough meeting, the person who plans the meetings and facilitates a smooth meeting process is referred to as the: A) presenter B) coordinator C) standards bearer D) maintenance oracle
b
At walkthrough meetings, there is a need to have individuals play specific roles such as: A) operating system manager B) presenter C) DBA D) top management
b
Infrastructure replacement/improvements, system maintenance costs, and user training and support are examples of: A) project-related costs B) operating costs C) start-up costs D) procurement costs
b
The analysis technique that finds the amount of time required for the cumulative cash flow from a project to equal its initial and ongoing investment is referred to as: A) return on investment (ROI) B) break-even analysis (BEA) C) net present value (NPV) D) future value (FV)
b
The current value of a future cash flow is referred to as its: A) future value B) present value C) investment value D) discount rate
b
The following are elements of project planning: A) describing the physical design statement B) describing the project scope, alternatives, and feasibility C) describing the identification of the business mission D) describing the logical design statement
b
The process of assessing potential legal and contractual ramifications due to the construction of a system refers to: A) technical feasibility B) legal and contractual feasibility C) economic feasibility D) operational feasibility
b
The process of assessing the degree to which a proposed system solves business problems or takes advantage of business opportunities refers to: A) schedule feasibility B) operational feasibility C) technical feasibility D) political feasibility
b
Which of the following is not an element of project initiation? A) establishing management procedures B) dividing the project into manageable tasks C) establishing a relationship with the customer D) establishing the project initiation team
b
Which of the following would be classified as a tangible cost? A) loss of customer goodwill B) cost of hardware C) employee morale D) operational inefficiency
b
The ________ is the major outcome and deliverable from the project initiation and planning phase that contains the best estimate of the project's scope, benefits, costs, risks, and resource requirements.
baseline project plan
________ finds the amount of time required for the cumulative cash flow from a project to equal its initial and ongoing investment.
break even analysis
A ________ is the justification for an information system, presented in terms of the tangible and intangible economic benefits and costs and the technical and organizational feasibility of the proposed system.
business case
A benefit derived from the creation of an information system that can be measured in dollars and with certainty is a(n): A) intangible benefit B) qualitative benefit C) tangible benefit D) operational benefit
c
A cost associated with an information system that cannot be easily measured in terms of dollars or with certainty refers to: A) economic cost B) tangible cost C) intangible cost D) one-time cost
c
A savings of $3,000 resulting from a data entry error correction would most likely be classified as a(n): A) intangible benefit B) qualitative benefit C) tangible benefit D) operational benefit
c
At a walkthrough meeting, the person who reviews the work product in terms of future maintenance activities is referred to as the: A) coordinator B) user C) maintenance oracle D) standards bearer
c
Cost reduction and avoidance, error reduction, and increased flexibility are examples of: A) intangible benefits B) qualitative benefits C) tangible benefits D) legal and contractual benefits
c
The analysis technique that uses a discount rate determined from the company's cost of capital to establish the present value of a project is commonly called: A) return on investment (ROI) B) break-even analysis (BEA) C) net present value (NPV) D) future value (FV)
c
The concept of comparing present cash outlays to future expected returns best defines: A) cost/benefit analysis B) internal rate of return C) time value of money D) investment return analysis
c
The number of members on the project team, project duration, and the number of organizational departments involved in the project are examples of which of the following risk factors? A) development group B) project structure C) project size D) user group
c
To gain an understanding of how key stakeholders within the organization view the proposed system is the purpose of: A) technical feasibility B) legal and contractual feasibility C) political feasibility D) operational feasibility
c
To gain an understanding of the organization's ability to construct the proposed system is the purpose of: A) operational feasibility B) schedule feasibility C) technical feasibility D) political feasibility
c
Which of the following would be classified as an intangible cost? A) hardware costs B) labor costs C) employee morale D) operational costs
c
Referencing a walkthrough meeting, the ________ plans the meeting and facilitates a smooth meeting process.
coordinator
At a walkthrough meeting, the person who ensures that the work product adheres to organizational technical standards is referred to as the: A) coordinator B) user C) maintenance oracle D) standards bearer
d
Capital costs, management and staff time, and consulting costs are examples of: A) project-related costs B) operating costs C) start-up costs D) procurement costs
d
Tangible benefits would include: A) improved organizational planning B) ability to investigate more alternatives C) improved asset control utilization D) lower transaction costs
d
The Project Scope Statement: A) is a short document prepared for the customer that describes what the project will deliver and outlines all work required to complete the project B) is useful for ensuring that both you and your customer gain a common understanding of the project C) is a very easy document to create because it typically consists of a high-level summary of the BPP information D) all of the above
d
When conducting a technical risk assessment, which of the following is true? A) A project has a greater likelihood of experiencing unforeseen technical problems when the development group lacks knowledge related to some aspect of the technology environment. B) Large projects are riskier than small projects. C) Successful IS projects require active involvement and cooperation between the user and development groups. D) All of the above.
d
Which of the following is NOT a role at a walkthrough meeting? A) coordinator B) user C) secretary D) support staff
d
The ________ is the rate of return used to compute the present value of future cash flows.
discount rate
________ is the process of identifying the financial benefits and costs associated with a development project.
economic feasibility
If the NPV of all costs is $100,000 and the NPV of all benefits is $170,000, then the ROI would be 35%.
false
Increased flexibility is an intangible benefit.
false
Intangible benefits are benefits associated with project start-up, development, or system start-up.
false
Management, operation, and planning personnel are examples of start-up costs.
false
Referencing a walkthrough, the maintenance oracle ensures that the work product adheres to organizational technical standards.
false
Referencing the Management Issues section of the Baseline Project Plan, the communication plan provides a description of the team member roles and reporting relationships.
false
The Project Scope Statement clearly outlines the objectives and constraints of the project for the development group.
false
The Statement of Work is a document prepared for the customer during project initiation and planning that describes what the project will deliver and outlines generally at a high level all work required to complete the project.
false
Using a discount rate of 14%, the present value of a $10,000 benefit received 5 years from now is $5,500.49.
false
An ________ is a benefit derived from the creation of an information system that cannot be easily measured in dollars or with certainty.
intangible benefit
An ________ is a cost associated with an information system that cannot be easily measured in terms of dollars or with certainty.
intangible cost
________ is the process of assessing potential legal and contractual ramifications due to the construction of a system.
legal and contractable feasibility
Referencing a walkthrough meeting, the ________, reviews the work product in terms of future maintenance activities.
maintenance oracle
________ uses a discount rate determined from the company's cost of capital to establish the present value of the project.
net present value
________ are costs associated with project start-up and development, or system start-up.
one time costs
________ is the process of assessing the degree to which a proposed system solves business problems or takes advantage of business opportunities.
operational feasibility
________ is the process of evaluating how key stakeholders within the organization view the proposed system.
political feasibility
________ is the current value of a future cash flow.
present value
The ________ is a document prepared for the customer during project initiation and planning that describes what the project will deliver and outlines generally at a high level all work required to complete the project.
project scope statement
________ are costs resulting from the ongoing evolution and use of a system.
reoccurring costs
________ is the ratio of the net cash receipts of the project divided by the cash outlays of the project.
return on investment
________ is the process of assessing the degree to which the potential time frame and completion dates for all major activities within a project meet organizational deadlines and constraints for affecting change.
schedule feasibility
Referencing a walkthrough meeting, the ________ ensures that the work product adheres to organizational technical standards.
standards feasibility
A ________ is a benefit derived from the creation of an information system that can be measured in dollars and with certainty.
tangible benefit
A ________ is a cost associated with an information system that can be easily measured in dollars and with certainty.
tangible cost
________ is the process of assessing the development organization's ability to construct a proposed system.
technical feasibility
The ________ is the concept of comparing present cash outlays to future expected returns.
time value of money
Economic feasibility is the process of identifying the financial benefits and costs associated with a development project.
true
Generally speaking, legal and contractual feasibility is a greater consideration if your organization has historically used an outside organization for specific systems or services that you now are considering handling yourself.
true
Most techniques for analyzing economic feasibility employ the time value of money concept.
true
Project planning focuses on defining clear, discrete activities and the work needed to complete each task.
true
Proper and insightful project planning, including determining project scope as well as identifying project activities, can easily reduce time in later project phases.
true
Site preparation is an example of a one-time cost.
true
The culmination of the feasibility analyses form the business case that justifies the expenditure of resources on the project.
true
The time value of money compares present cash outlays to future expected returns.
true
Walkthroughs are a common occurrence in most system development groups.
true
A ________ is a peer group review of any product created during the systems development process.
walkthrough
