Mock Exam 1

You asked one of your team members about the schedule variance (SV) for one of her key deliverables. She mentioned that she is behind schedule but there would not be any cost variance. Which of the following is NOT true in this case? a) EV and PV were the same b) EV and AC were the same c) EV is less than PV d) CPI is 1

a) EV and PV were the same Explanation: We know SV = EV - PV. Since SV has a negative value, EV must be less than PV. Also, CV = EV - AC. Since there will be no cost variance, EV and AC have the same value. CPI is also EV/AC = 1.

Which one of the following is the logical breakdown of what needs to be done to produce the project deliverables and is sometimes referred to as the performing organization's methodology for projects? a) Product life cycle b) Project life cycle c) Feedback loop d) Product development

b) Project life cycle Explanation: The project life cycle is the logical breakdown of what needs to be done to produce the project deliverables, and sometimes it is referred to as the performing organization's methodology for projects. On the other hand, a product life cycle consists of generally sequential, nonoverlapping product phases determined by the manufacturing and control needs of the organization. For instance, as predicted by Moore's law, each year a microprocessor company introduces new models of processors that are faster and more powerful than their predecessors. Microprocessors that are obsolete or do not sell well are quickly retired from production. This product life cycle begins in R and D, extends to manufacturing, and finally ends with phase out.

For an IT project your EV = $130,500, PV = $125,500, and AC = $129,000. Which one of the following statements is TRUE? ​ a) The project is behind schedule and over budget b) The project is ahead of schedule and under budget c) The project is behind schedule and under budget d) The project is ahead of schedule and over budget

b) The project is ahead of schedule and under budget Explanation: The EV is greater than the PV, which indicates the project is ahead of schedule. The AC is smaller than the EV, which indicates the project is under budget.

Which one of the following analysis methods usually uses Monte Carlo simulation to simulate the outcome of a project by making use of three-point estimates (Optimistic, Pessimistic, Most Likely) for each activity, a huge number of simulated scheduling possibilities, or a few selected scenarios that are most likely, and the network diagram? a) Precedence Diagramming Method (PDM) b) What-if scenario analysis c) Critical chain method d) Resource leveling

b) What-if scenario analysis Explanation What-if Scenario Analysis usually uses Monte Carlo simulation to simulate the outcome of a project by making use of three- point estimates (optimistic, pessimistic, most likely) for each activity, a huge number of simulated scheduling possibilities, or a few selected scenarios that are most likely, and the network diagram. The outcome of this analysis may be used to evaluate the project schedule under adverse conditions and to develop the preventive and contingency action plan to reduce the impact and probability of the unexpected situations.

Over the last three weeks the project team has finally been able to establish a shared vision of what the product would look like when it is complete. This is an example of? ​ a) Shared vision b) Requirements gathering c) Progressive elaboration d) Progressive management

c) Progressive elaboration Explanation: Progressive elaboration occurs when more information in detail emerges over time.

Success in portfolio management, which can be generally described as a group of projects or programs and other works to achieve a specific strategic business goal, is generally defined as: a) Aggregate performance of all components (projects, programs, and other related work). b) Control of changes to specific products & services. c) Compliance with schedule, budget, and specifications requirements. d) Realization of the business benefits and financial objectives.

a) Aggregate performance of all components (projects, programs, and other related work). Explanation: Portfolio management encompasses identifying, prioritizing, authorizing, managing, and controlling the collection of projects, programs, other work, and sometimes other portfolios to achieve strategic business objectives. It is generally associated with the relationships between components in the portfolio, effective resource management to protect priority components, and the aggregate results of the portfolio as they relate to strategic performance. The components may not be related other than the fact that they are helping to achieve the common strategic goal.

You are overseeing a project to implement an accounting application for a dentist's office. In one of the performance meetings, you came up with the following measurement: AC = 500, PV = 600, and EV = 650. What is going on with this project? a) Both CV & SV are positive numbers; thus, you are under budget and ahead of schedule b) You do not have enough information to calculate SPI & CPI c) The CV is negative number, which means you have spent more than planned d) The SV is a negative number, which means the project is behind schedule

a) Both CV & SV are positive numbers; thus, you are under budget and ahead of schedule Explanation We know SV = EV - PV and CV = EV - AC So SV = 650 - 600 = 50 and CV = 650 - 500 = 150 A positive CV indicates that the project is under budget, and a positive SV indicates that the project is ahead of schedule

All project phases conclude with a review of the deliverables and related work (phase exits or stage gates or kill points) for the purpose a) Determining if the project should continue and the next phase should be initiated. b) Detecting defects and correcting errors. c) Assessing project risks. d) Enforcing formal control procedure of the project.

a) Determining if the project should continue and the next phase should be initiated. Explanation: At the conclusion of a project phase, the project manager and team should assess the performance of the project and determine if acceptable conditions exist to support a decision to continue or terminate the project. If the decision is to move forward with the project, then the decision is also made about whether the next phase should be initiated or not. Risk levels will vary as the project progresses, and the end of a phase is generally considered to be a good point to reassess risk. Project control procedures should be enforced throughout the project life cycle.

What activity can the agile team do to list the reasons for why a particular process was failing during iteration? a) Fishbone analysis b) Check-in analysis c) Short subjects d) SMART goals

a) Fishbone analysis Explanation: A Fishbone analysis is done during the step of generate insight in a retrospective to show the reasons for why something would have failed.

Which one of the following is a strategy execution framework that keeps the entire organization focused on the overall strategy and provides guidance on how to prioritize, manage, execute, and measure projects, programs, portfolios, and other organizational work and practices to achieve a better result, improved performance, and a substantial advantage over the competitors? a) Organizational Project Management (OPM) b) Portfolio Management c) Program Management d) Process Management

a) Organizational Project Management (OPM) Explanation: Organizational Project Management (OPM) is a strategy execution framework that keeps the entire organization focused on the overall strategy. It provides guidance on how to prioritize, manage, execute, and measure projects, programs, portfolios, and other organizational work and practices to achieve a better result, improved performance, and a substantial advantage over the competitors. A portfolio can be generally described as a group of projects or programs and other works to achieve a specific strategic business goal. The programs may not be related other than the fact that they are helping to achieve the common strategic goal. A program is a group of related projects managed in a coordinated way to capitalize benefits and control what is not achievable by managing those projects individually. Program management is the centralized and coordinated management of a program to obtain the strategic objectives and benefits sought through the inception of the program. Project management is the application of knowledge, skills, tools, and techniques to satisfy project requirements.

The application of knowledge, skills, tools, and techniques to satisfy the project needs by establishing project objectives, identifying project requirements, managing stakeholders, and balancing project constraints (i.e., cost, time, quality, scope, risk, and others) is referred to as: a) Project Management b) Project administration c) Project initiation d) Project coordination

a) Project Management Explanation: Project management is the application of knowledge, skills, tools, and techniques to satisfy project requirements.

You are in the Determine Budget process of developing a budget or cost baseline and project funding requirements. All of the following are inputs in this process EXCEPT: a) Work performance data b) Cost Management Plan c) Activity cost estimates d) Project schedule

a) Work performance data Explanation: Work performance data is not an input in the Develop Budget process but an input in the Control Costs process.

There were eight potential projects in your organization, and your senior management wanted to select the best project that would meet and exceed the organizational strategic goals and objectives. As your organization has limited resources and time constraints, it developed business cases for these projects and compared the benefits to select the best project. Out of eight projects, management has selected two projects and later on decided to go for Project X, which would yield $250,000 in benefits instead of Project Y, which would yield $200,000. What is the opportunity cost for selecting Project X over Project Y? a) $250,000 b) $200,000 c) -$250,000 d) -$200,000

b) $200,000 Explanation: The opportunity cost is the value of the project that was not selected or the opportunity that was missed out on. In this case, the opportunity cost for Project X is the value of the Project Y, or $200,000. 15. A: We know SV = EV - PV and CV = EV - AC So SV = 650 - 600 = 50 and CV = 650 - 500 = 150 A positive CV indicates that the project is under budget, and a positive SV indicates that the project is ahead of schedule.

Your project has a budget of $900,000 and is running well. In the latest earned value report, the team reported that the CPI = 1.1, the SPI = 0.9, and the PV= $600,000. You want to know, from this point on, how much more the project will cost but could not find it in the report. What will be the estimate to complete, or ETC, be in this case? a) $300,000 b) $372,272 c) $818,181 d) 490,909

b) $372,272 Explanation: We know ETC = EAC - AC, so we need to find out the values for Estimate at Completion (EAC) and Actual Cost (AC). We are given the following values: BAC = $900,000 CPI = 1.1 SPI = 0.9 PV = $600,000 We also know that EAC = BAC/CPI; thus EAC = $900,000/1.1 = $818,181 Now we have SPI = 0.9 or EV/PV = 0.9; thus EV = 0.9 * PV So EV = 0.9 * 600,000 = $540,000 We also know that CPI = 1.1 or EV/AC = 1.1; thus, EV = 1.1 * AC So AC = EV/1.1 or AC = 540,000/1.1 = $490,909 So ETC = EAC - AC or ETC = $818,181 - $490,909 = $327,272

You are the project manager of a construction project that will take six months to complete and will cost $75,000/month. At the end of the third month, you were asked to find out the cumulative SPI for the project and report it to management. While reviewing the project status, you found that you have spent $80,000 in the first month, $72,000 in the second month, and $75,000 in the third month. You also found that the project was 15 percent complete at the end of first month, 35 percent complete at the end of second month, and 45 percent complete at the end of third month. If you planned to complete 50 percent of the work by this time, what is the cumulative SPI at the end of month three? a) 0.5 b) 0.9 c) 0.34 d) 1.1

b) 0.9 Explanation: We have BAC = 6 * $75,000 = $450,000 At the end of month three, we were supposed to finish 50 percent of the work. Thus, PV = BAC * Planned % Complete or PV = $450,000 * 50 percent = $225,000 Also, project work is 45 percent completed at the end of three months. Thus, EV = BAC * Actual % Complete or EV = $450,000 * 45 percent = $202,500 Both the PV and EV are cumulative values in three months. We know SPIc = EVc/PVc or SPIc = $202,500/$225,000 = 0.9

During a retrospective meeting what should the team do after they have set the stage? a) Generate insight b) Gather data c) Decide what to do d) Close retrospective

b) Gather data Explanation: After the team have set the stage which is the first step in a retrospective, the second step would be to gather data.

What is the name of PMI's organization maturity model for project management that helps to determine the level of ability of an organization to deliver the desired strategic outcomes in a reliable, controllable, and predictable manner? a) ISO 9000 b) OPM3 c) Project Management Maturity Model (PMMM) d) Six Sigma

b) OPM3 Explanation: OPM3 is the PMI's organizational project management maturity model. This model helps to determine the level of ability of an organization to deliver the desired strategic outcomes in a reliable, controllable, and predictable manner

Which of the following is not a principle of agile planning? ​ a) Engage the project team b) Engage stakeholders c) Conduct most of the planning at the beginning d) Conduct planning throughout the project

c) Conduct most of the planning at the beginning Explanation: On the traditional project most of the planning is done on the beginning, while agile projects are planned throughout the project with the help of all stakeholders.

To develop an online accounting application for your software development project, you are working on figuring out the total funding requirements and periodic funding requirements of the project. Which of the following will help you the MOST in this case? a) Project budget and contingency reserves b) Funding limit reconciliation c) Cost baseline and management reserves d) Management reserves and contingency reserves

c) Cost baseline and management reserves Explanation: Total fund or cost budget = cost baseline + management reserves Cost baseline = project cost + contingency reserves The cost baseline is the project cost plus the contingency reserves, and the cost budget, or how much money the company should have available for the project, is the cost baseline plus the management reserves. The project manager determines, manages, and controls the contingency reserves, which will address the cost impact of the risks remaining during the Plan Risk Responses process. On the other hand, management reserves are funds to cover unforeseen risks or changes to the project. In this case, the cost baseline and the management reserves will be most helpful to calculate the total funding and periodic funding requirements. Funding limit reconciliation is the technique of reconciling the expenditure of funds with the funding limits set for the project. As per the variance between the expenditure of funds and planned limit, the activities can be rescheduled to level out the rate of expenditures.

A project manager managing a recruitment automation application project just completed developing the schedule and requested stakeholders and the client for their approval. The sponsor has expressed her frustration about the unexpected long duration of the project and has demanded the schedule be compressed as much as possible. While exploring different options, you find out that you cannot really change the network diagram due to various constraints, but the sponsor has agreed to pay for additional personnel resources if needed. What will be your BEST option in this situation? a) Apply the critical chain method b) Fast-track the project and also apply the resource leveling method c) Crash the project d) Crash and fast-track the project

c) Crash the project Explanation: Fast-tracking is the technique of doing critical path activities in parallel when they were originally planned in series. Fast- tracking will not be an option in this case since you cannot change the network diagram, or in other words, you cannot perform activities in parallel that were originally planned to be completed in sequence. The best option here is to add additional resources to the project activities on the critical path to complete them quickly. Resource leveling is used to produce a resource-limited schedule by letting the schedule slip and cost increase in order to deal with a limited amount of resources, resource availability, and other resource constraints. The critical chain method is another way to develop an approved, realistic, resource-limited, and formal schedule. It provides a way to view and manage uncertainty when building the project schedule.

The project team is working with the customers to write the user stories. The customers have refused as they claim this would add no value to the project. What would be the best step to resolve this? ​ a) Have the team write the user stories b) Have the agile PM write the user stories c) Educate the users why the user stories are valuable d) Inform them user stories may not be needed

c) Educate the users why the user stories are valuable Explanation: When managing an agile project user stories will produce a lot of value to both the team members and the customers, as such it would be best to educate them on the value of the user stories.

Control Quality is the process of monitoring specific project results to determine if they comply with applicable quality standards and identifying ways to eradicate causes of unsatisfactory results. All of the following are tools & techniques used in the Control Quality process EXCEPT: ​ a) Inspection b) Flow chart c) Quality metrics d) Statistical sampling

c) Quality metrics Explanation Quality metrics are an output of the Plan Quality Management process and an input to both the Manage Quality and Control

While trying to isolate the root cause of a critical problem in the production process, your team has detected two variables— temperature and humidity—as the conceivable contributors to the problem. There is a concern that these two variables are complicating the problem by affecting each other. Which of the following tools or techniques will assist to see if there is any interdependency between them? a) Cause & effect diagram b) Influence diagram c) Scatter diagram d) Pareto chart

c) Scatter diagram Explanation The scatter diagram is used to determine the correlation between two variables.

A project life cycle is a representation of the generally sequential and sometimes overlapping project phases that a project typically goes through. All of the following statements about the project life cycle are true EXCEPT: a) Cost and staffing start low, increase toward the end, and drop rapidly near closing. b) Project risk is highest at the beginning of the project and reduces as the project approaches its end. c) Stakeholder influence is lowest at the start and increases as the project proceeds. d) Cost of changes is low in the beginning but extremely high later in the project.

c) Stakeholder influence is lowest at the start and increases as the project proceeds. Explanation Stakeholder influence is highest at the start and diminishes as the project proceeds.

With the help of your team members, you just finished the development of an approximation of the costs of all resources, such as labor, materials, equipment, services, facilities, and other special items associated with each schedule activity. What should you do NEXT? a) Control costs b) Resource leveling c) Bottom-up estimating d) Determine budget

d) Determine budget Explanation: You just completed the Estimate Costs process and should be focusing on the Determine Budget process.

You are in the Determine Budget process of developing a budget or cost baseline and project funding requirements. All of the following are tools & techniques in this process EXCEPT: a) Cost aggregation b) Reserve analysis c) Funding limit reconciliation d) Performance review

d) Performance review Explanation: Performance review is not a tool & technique in the Develop Budget process but a tool & technique in the Control Costs process.

You are a team member working on a software application project. You realize that the project manager is choosing a project life cycle that has a predictive life cycle in which scope, schedule, and cost are determined in the early stage of the project prior to starting project work to produce the deliverables. This type of project life cycle is also known as: a) Change-driven project life cycle b) Adaptive project life cycle c) Preferred project life cycle d) Plan-driven project life cycle

d) Plan-driven project life cycle Explanation: Plan-driven projects have a predictive life cycle in which scope, schedule, and cost are determined in the early stage of the project prior to starting project work to produce the deliverables. This predictive life cycle is also referred to as waterfall or traditional life cycle. For example, most construction projects are typically managed using this sort of predictive approach. A change-driven project life cycle usually has a varying level of initial planning for scope, schedule, and cost. An adaptive life cycle is a change-driven life cycle, and it is also referred to as an agile life cycle. An adaptive life cycle, as the name suggests, broadly defines the fixed scope, schedule, and cost with the clear understanding that they will be refined and adjusted as the project progresses. Preferred project life cycle is a made-up term.

You recently finalized your project cost estimate and cost baseline. The difference between the project cost estimate and the cost baseline can be BEST described as: a) The control account estimates b) The work package estimates c) The management reserves d) The contingency reserves

d) The contingency reserves Explanation: The cost baseline is the project cost plus the contingency reserves; thus, the difference between the project cost estimate and the cost baseline can be best described as contingency reserves.

You recently took over a project from another project manager who left the organization. You find out that the project has a BAC = $45,000, PV = $30,000, cumulative AC = $25,000, and cumulative EV = $24,000. You decided to perform a forecasting analysis and calculated the values for EAC, ETC, TCPI, and VAC. Which of the following is NOT true? a) You will need $21,875 more to complete this project b) The project will cost $46,875 c) The project performance is not good as TCPI is 1.05 d) The project will be under budget by $1,875

d) The project will be under budget by $1,875 Explanation: We are given the following values: BAC = $45,000 PV = $30,000 Cumulative AC = 25,000 Cumulative EV = 24,000 We know EAC = BAC/CPIc ETC = EAC - AC VAC = BAC - EAC and TCPI = (BAC - EV) / (BAC - AC) CPIc = EVc/ACc Thus CPIc = $24,000/$25,000 = 0.96 So EAC = BAC/CPIc = $45,000/0.96 = $46,875 ETC = EAC - AC = $46,875 - $25,000 = $21,875 TCPI = (BAC - EV) / (BAC - AC) = (45,000 - 24,000) / (45,000 - 25,000) = 21,000 / 20,000 = 1.05 VAC= BAC - EAC = $45,000 - $46,875 = -$1,875 The project will cost $46,875 since the EAC is $46,875. The ETC is $21,875, so you will need $21,875 to complete the project. The VAC is -$1,875; thus, the project will be over budget by $1,875. The project performance is not good as TCPI is 1.05. All of the statements are true except D. The project is over budget by $ 1,875, not under budget.

Steve, a project manager, is trying to figure out the performance that must be achieved in order to meet the financial and schedule goals in his project. He is using a measurement that will give him the status on the remaining work with respect to the funds remaining. Which of the following measures is Steve using? ​ a) Cost aggregation b) Variance analysis c) Trend analysis d) To-Complete Performance Index (TCPI)

d) To-Complete Performance Index (TCPI) Explanation: To-Complete Performance Index (TCPI) calculates the performance that must be achieved in order to meet financial or schedule goals. If targeting the current plan, TCPI = (BAC - EV) / (BAC - AC) If targeting the current EAC, TCPI = (BAC - EV) / (EAC - AC) Here AC = Actual Cost, EV = Earned Value, EAC = Estimate at Completion, and BAC = Budget at Completion. Here (BAC - EV) is the remaining work and (BAC - AC) or (EAC - AC) is the remaining fund.