Business Environment

Which of the following is not an input to Implement Risk Responses? A. Risk Register B. Enterprise Environmental Factors C. Risk Management Plan D. Lessons Learned Register

Answer: B Business Environment - Task 1 - Manage Compliance Enterprise Environmental are notably absent from this process because they had been taken into account previously. This process involves the execution of a plan rather than the development of one, which would necessitate considering those internal and external factors that are outside of the control of the project management team.

You have been working on a 1-year project for nine months. The project is ahead of schedule when one of the functional managers tells you the resources committed to the project are no longer available. After checking further, you discover the company has another project that just started and is using the resources committed to your project. You believe the new project is not critical, but the project manager is the daughter of a board member. What is the best course of action in this situation? A. Determine when resources will become available B. Ask upper management to formally prioritize the projects C. Use the reserve to hire contractors to complete the work D. Negotiate a sharing of the resources with the other project manager

Answer: D Business Environment - Task 4 - Support Org Change According to the PBMOK Guide you should always try to resolve conflicts internally and should use negotiating skills to try to come to a mutually beneficial agreement.

Which of the following best describes the key benefit for the collect requirements process? A. The key benefit of this process is it provides the basis for defining the product scope and project scope B. The key benefit of the process is it provides the basis for creating the project Management Plan C. The key benefit of this process is it provides the basis how schedule and cost will be determined D. The key benefit of this process is it provides the basis of the performance measurement baseline which is established and managed using EVM

Answer: A Business Environment - Task 2 - Evaluate/ Deliver Benefits The key benefit of this process is it provides the basis for defining the product scope and project scope. This is verbatim from the PMBOK Guide on pg. 138.

You are the Team Facilitator on an Agile Project. Who is ultimately accountable for the business value of the solution the project team produces? A. Product Owner B. Team Facilitator C. The whole team D. Sponsor

Answer: A Business Environment - Task 3 - Evaluate Scope Changes The Product Owner represents the customer and is ultimately accountable for the solution. The team is responsible for creating the solution and the Team Facilitator is responsible for making sure the team has all the tools and resources necessary to make that happen. The Sponsor provides the funding. PMI Authorized PMP Exam Prep Student Guide/ Page 269

You are the Project Manager of a hybrid project that is implementing a business change to your organization that Senior Management announced some months ago. You are ready to move the solution into production and need to document the knowledge transfer, training, and readiness activities required to implement the business change. Where would this be documented? A. Roll Out Plan B. Implementation Plan C. Project Management Plan D. Change Management Plan

Answer: A Business Environment - Task 4 - Support Org Change These items are documented in the Roll Out Plan. The Project Management Plan contains the subsidiary plans, baselines and some additional documents; and the Change Management Plan documents procedures regarding change control. The Implementation plan documents procedures needed to implement the full solution, whereas the roll out plan documents procedures for moving into production.

You are a vendor who has just won a large contract. As the project manager of this consulting firm, you have over a decade of deep experience in this specific kind of project; however, this is your first time working on a government contract and must now be sensitive to government-specific considerations. For example, government regulations that would limit your options as a project team. These are best described as? A. Bureaucracies B. Constraints C. Workarounds D. Assumptions

Answer: B Business Environment - Task 1 - Manage Compliance Union contracts and government regulations that are imposed on your project are examples of constraints. Constraints are anything that limits your options on a project. This can include time constraints or imposed deadlines as well.

Which of the following best describes a program? A. Grouping of projects in a portfolio B. Group of related projects managed in a coordinated way C. Project with a cost over $1 million grouped together D. Group of 3 or more projects which are overseen by the same parts of the organization

Answer: B Business Environment - Task 2 - Evaluate/ Deliver Benefits A program is a group of related projects managed in a coordinated way to obtain benefits and control not available from managing them individually. The key here is that the projects are related.

The CFO has a high-priority goal to ensure financial compliance across the enterprise. You have been chartered to lead a project that aligns to this business objective. You are now reviewing the corporate finance laws that would pertain to your organization to ensure the project follows its guidelines. Which of the following best describes what is being evaluated here? A. Collect Requirements B. Develop Charter C. Work performance data D. Regulatory and environmental considerations

Answer: D Business Environment - Task 3 - Evaluate Scope Changes Answers A and B are their processes, but the question is asking about what is being evaluated. Answer C is data collected during the performance of project work that is used to create information or reports. Answer D commonly falls under the umbrella of Enterprise Environmental Factors for which a project team must identify and make accommodations.

You are a project manager for Scarem-Up-Stiff production company. Your company develops and produces horror movies for the big screen. Your latest project has been cancelled due to budget cuts for that genre of film. Which of the following statements is true? A. The project ended due to extinction because the funds were cut off. B. The project ended due to integration because the funds were cut off. C. The project ended due to starvation because the resources were allocated to another film division. D. The project ended due to starvation because the funding was cut off.

Answer: D Business Environment - Task 3 - Evaluate Scope Changes Starvation occurs because the project no longer receives the resources needed to continue. Resources would include funding, such as presented in this question.

You are a project manager who works on contract for several different organizations. Each organization you work for varies in its organizational structure, and you have found that some structures are much easier for you to operate in than others. In particular, you like to have full control over resource allocation, and it does not particularly bother you that the team members may not have a job to go back to at the project's conclusion, as you have found they largely work on a contract basis as well. In which type of organization would you ideally want to work? A. Functional Organization B. Weak Matrix C. Strong Matrix D. Project-oriented Organization

Answer: D Business Environment - Task 4 - Support Org Change Project managers have the highest level of authority in a project-oriented organization, however, the down-side is that the project manager and his or her team may not have a steady job to return to after the project concludes.

You are the project manager for a large Education company. You are currently managing a project to handle all aspects of marketing communications for higher education clients, from strategy to campaign. This is a new idea and a new product. A new product will be created based on market research. This is an example of which of the following reasons to launch a new project? A. Organizational need B. Customer request C. Market demand D. Legal requirement

Business Environment - Task 3 - Evaluate Scope Changes Projects can be created for a number of reasons, and this example supports the market demand choice.

You are conducting documentation reviews and are also using information gathering techniques with your subject matter experts, all while working to fill in parts of your Risk Register. What process are you performing? A. Plan Risk Management B. Identify Risk C. Perform Qualitative Risk Analysis D. Plan Risk Response

Answer: B Business Environment - Task 1 - Manage Compliance The Identify Risk process determines which risks might affect the project and documents their basic characteristics. Documentation reviews and information gathering techniques should have pointed you towards this process, as you will want to employ a no stone un-turned" approach when identifying risks."

You are managing a project for the development of a new medical device and have completed all of your planning. As the work is commencing, a new regulation is issued by the FDA, effective immediately, which requires some additional steps to be performed in the development of this device. What is the best way to proceed? A. Stop the work to which the new regulation pertains, issue a change request, and proceed with the other work that is unaffected by the change B. Stop all work and issue a change request based on the new requirements C. Stop all work and go back to the planning processes to implement the needed changes D. Continue completing the work as planned, and notify the sponsor of the new regulation

Answer: A Business Environment - Task 1 - Manage Compliance Here, you need to comply with the regulation, so the work which is affected by the new regulation needs to stop temporarily. You will need to issue a change request and follow change control procedures to implement the new change. You would not necessarily need to stop all work, however, as this could be devastating to your project schedule, budget, resource availability, etc.

You are the project manager for a large food and beverage company. You are currently managing a project to offer a platform that gives farmers direct access to the marketplace for their coffee, allowing them to maintain ownership until the point of sale. You need to conduct a feasibility study. A feasibility study is an example of which of the following? A. A phase deliverable B. A requirement for all project plans C. A subsidiary project plan D. A report to determine if a project is successful

Answer: A Business Environment - Task 2 - Evaluate/ Deliver Benefits A feasibility study is an example of a phase deliverable. Often feasibility studies are done as an initial phase to ensure the project has a good chance of success in later phases.

A Benefits Management Plan is a key document that the project sponsor provides, which is an input to developing the Project Charter and the Project Management Plan, and is also referenced as part of the project closure process. Which of the following is not a component of this plan? A. Cost/benefit justification for the project B. How the project is aligned with the company's strategic goals and objectives C. Who is responsible for monitoring, recording and reporting benefits D. When the benefits are expected to be realized over time

Answer: A Business Environment - Task 2 - Evaluate/ Deliver Benefits Cost/benefit justification information is part of the Business Case document, which is also prepared by the project sponsor.

Which of the following is used to define the project and its relation to the organization's strategic goals? A. Project Charter B. Organizational Process Assets C. Project Scope Statement D. Scope Plan

Answer: A Business Environment - Task 2 - Evaluate/ Deliver Benefits The Charter authorizes the project's existence and integrates the project itself with the organizational strategies and objectives.

Your company has a large client that has requested a special component be created for one of their test engines. Your organization agrees, creates a standard contract with the customer, and your manager assigns you to manage this project. The project was launched because of which of the following? A. A customer request B. A change in the technology your customer is creating C. A legal requirement (contractual) D. Market demand for the new component

Answer: A Business Environment - Task 2 - Evaluate/ Deliver Benefits This project was launched because the customer requested the new component. B is incorrect because the project is not a response to a change in technology, but a customer request. C, a legal requirement, is not correct because this actually refers to a law or mandated regulation that has been created. D, an organizational need, typically refers to a project designed to enhance the performance of the organization.

Which of the following is a true statement about how agile teams measure results? A. Agile favors empirical and value-based measurements instead of predictive measurements. B. Agile measures result at the end of the project only, and this is conducted by the project team without the PM present. C. Agile measures result at the end of the project only, and this is conducted by the project team facilitated by the PM. D. Agile favors empirical and predictive measurements instead of value-based measurements.

Answer: A Business Environment - Task 2 - Evaluate/ Deliver Benefits This question is discussed in the Agile Practice Guide on p. 61.

You are the project manager for a large OEM company. You are currently managing a project to create new components for a tablet. You have invested considerable resources in the planning and executing of the project. You want to ensure that you minimize any scope creep. All of the following are outputs of Control Scope except which of the following? A. Change requests B. Scope changes C. Project document updates D. Work performance information

Answer: B Business Environment - Task 3 - Evaluate Scope Changes The outputs of the Control Scope process are work performance information, organizational process assets updates, change requests, project management plan updates, and project documents updates. The change requests could result in scope changes, but they are not an output themselves.

You are a project manager for a wedding-planning company. Since every wedding is unique, your organization believes in managing each wedding as a project. You've come up with a great idea for a new event that you're certain customers will love and which will also generate profit for the company. Your boss asked you to investigate the best alternative methods for implementing the new idea and come back with a suggested solution. You discover that Alternative A could yield revenues of $100,000 in two years, while Alternative B could yield revenues of $107,000 in three years. The finance manager told you to use eight percent as the cost of capital. Which project should you choose and why? A. Alternative A, because the discounted cash flows are $85,734, while the discounted cash flows for Alternative B are $84,940. B. Alternative A, because the discounted cash flows are $85,940, while the discounted cash flows for Alternative B are $83,352. C. Alternative B, because the discounted cash flows are $85,700, while the discounted cash flows for Alternative A are $83,352. D. Alternative A, because the discounted cash flows are $96,457, while the discounted cash flows for Alternative B are $84,677.

Answer: A Business Environment - Task 2 - Evaluate/ Deliver Benefits This question requires discounted cash flow analysis to compare the value of Alternative A to Alternative B. The present value formula for Alternative A is calculated as follows: $100,000 / (1 + .08)^2 = $85,734. Alternative B is calculated this way: $107,000 / (1 + .08)^3 = $84,940. The present value formula is being used, as opposed to NPV, because the question didn't state revenue was being received each year. Instead it states the revenue in two and three years, so assuming at the end of year 2 for Alternate A and year 3 for Alternate B.

As deliverables are being produced on your project, you evaluate how each one contributes to the goals and objectives of the project. What are you doing? A. Benefits realization B. Lessons learned C. Quality audit D. Risk audit

Answer: A Business Environment - Task 2 - Evaluate/ Deliver Benefits Throughout the project the PM needs to keep an eye on how the project is realizing the benefit goals and objectives established at project conception and confirmed during the Develop Project Charter process, making A the correct answer. Lessons learned allows for continual improvement and could support how we met or didn't meet the benefits. A quality audit reviews our actual project activities for compliance with OPAs and thus the Project Management Plan and will create lessons learned. A risk audit examines the effectiveness of the risk responses and the overall risk management process and also will create lessons learned.

You are the project manager for a large IT company. Your project is new and you have received multiple change requests. The Change Control Board has approved most of these changes. As a result of approved changes to the Scope Statement, substantial changes to project costs and project schedule occurred. What must occur next and why? A. Baselines must be adjusted to reflect the new scope, costs, and schedule. B. Baselines must be adjusted to reflect the new costs and schedule. C. Updates to the scope management plan are made to reflect the approved project change. D. Lessons learned are documented so that future projects take into consideration the impact of the change.

Answer: A Business Environment - Task 3 - Evaluate Scope Changes Answer choice A is the only choice that mentions updating all 3 baselines. As a result of the approved change, all 3 baselines must be updated to reflect the approved change.

Marketplace conditions are an example of which of the following? A. Enterprise Environmental Factors B. Organizational Process Assets C. Internal Constraints D. Requirements

Answer: A Business Environment - Task 3 - Evaluate Scope Changes Enterprise environmental factors are internal or external factors that surround or influence a project's success. Examples include: market conditions, infrastructure, political climate, corporate culture, etc.

Which of the following is not a component of PESTLE? A. Planning B. Environmental C. Social D. Technical

Answer: A Business Environment - Task 3 - Evaluate Scope Changes PESTLE is an acronym to identify the external business environment factors that can affect the value and desired outcomes of a project. The acronym stands for political, economic, social, technical, legal and environmental factors.

A pandemic has broken out and the local state officials have banned all public gatherings. You have determined that this will significantly affect the scope of your agile project. What would be a useful tool to help the team function. A. Use remote paring along with your project management information system to keep the team moving forward B. Create a Fishbowl C. Adobe Connect D. Update your communication & resource management plans noting the increased number of channels of communication and the need for cultural awareness training for the team

Answer: A Business Environment - Task 3 - Evaluate Scope Changes The Agile practice guide discusses best practices with ""dispersed teams"" and the need for virtual workspace on p 46. Although a fishbowl is discussed in this section the intent of that tool is not to connect individuals with other individuals it's more about connecting a group with another group. The best answer is A using remote pairing.

What two agile tools can be used to track and display organizational change in a transparent and appealing way, which improves the likelihood of success. A. Kanban and Backlog B. Change log and product vision C. Sprint reviews and Retrospectives D. Planning Poker & Roman Voting

Answer: A Business Environment - Task 4 - Support Org Change In an evolving organization, the change process can be treated like a separate agile project and one can track change with a combination of backlog and Kanban. The Agile practice guide discusses best practices on p 84-86.

Audits may be conducted to verify a project's compliance with organizational policies, standards, procedures and processes. Which of the following would not be an appropriate auditor resource? A. PMO B. Project Manager C. Internal Audit Team D. 3rd party contractor

Answer: B Business Environment - Task 1 - Manage Compliance Neither you as the project manager or anyone or your team would be an appropriate choice for the auditor role, as there could be a conflict of interest. Audits should be conducted by other parties outside of your team.

During risk response planning, you are in the process of developing options and determining actions to reduce threats to your project's objectives. When you show the results of your risk response planning to your project sponsor, she is not comfortable with the risks in the project and suggests that the project scope should be decreased. This is an example of: A. Inappropriate risk management because it is having a direct impact on your project scope B. Risk Avoidance C. Risk Mitigation D. Risk Transfer

Answer: B Business Environment - Task 1 - Manage Compliance Risk avoidance involves changing some aspect of the project management plan to eliminate the threat posed by a risk, and reducing the scope of the project would be a good example of such an avoidance.

You are creating an online store and as part of the sprint your team is testing the checkout page with certain users. You are providing the users with two versions of the page; one lists the orders on the left-hand side of the page with the price breakdown on the right-hand side. The other version lists the orders on the right-hand side of the page with the price breakdown on the left in large red fonts. You are trying to determine which version will be more user friendly when this functionality goes live. What tool are you using? A. User Acceptance Testing B. A/B Testing C. Root Cause Analysis D. Scope Validation

Answer: B Business Environment - Task 2 - Evaluate/ Deliver Benefits A/B testing is where you have two very similar products and are trying to determine which will provide more value based on user interaction, and that is what you are trying to determine here. It is not User Acceptance Testing or Scope Validation since the users are not testing whether the product meets their requirements, you are just trying to determine which option they prefer. There is no issue here so it is not a root cause analysis.

Project selection is critical for an organization. Projects need to be aligned with the strategic direction of the company and provide the most value possible. As a project manager you need to understand how and why projects are selected. Which of the following is not a project selection tool? A. Peer Review B. Earned Value C. Scoring Model D. Economic Models

Answer: B Business Environment - Task 2 - Evaluate/ Deliver Benefits Choice B is the correct answer. Earned Value is a project progress measurement tool while all of the other choices, which include Benefit Measurement Methods, Scoring Models, and Economic Models, are generally used for project selection.

An important aspect of success criteria is that it should be quantifiable. Which of the following is an example of quantifiable success criteria? A. The product has high quality B. A ten percent reduction in production costs C. The customer is happy with the results D. An increase in stakeholder satisfaction

Answer: B Business Environment - Task 2 - Evaluate/ Deliver Benefits Quantifiable means measurable, and thus is typically numeric. The only answer choice that can be accurately measured is choice B, because it has a number in it. All of the other answer choices are subjective.

The project steering committee is considering which project they should invest capital in. Bob's project promises to be worth $175,000 in four years. The project steering committee is interested in Bob's project, but they would like to know the present value of the return if the interest rate is 6 percent. What is the present value of Bob's project? A. $175,000 B. $139,000 C. $220,000 D. $43,750

Answer: B Business Environment - Task 2 - Evaluate/ Deliver Benefits The formula for Present Value (PV) is FV / (1 + i) ^n, where FV is the future value, i is the interest rate, and n is the number of periods. PV = 175,000 / (1.06 * 1.06 * 1.06 * 1.06), PV = $139,000.

Upon reaching the project constrained end date of your new inventory control software project, you realize some high business value requirements have not been completed and will not be in your release. Which of the following did you most likely not do effectively? A. Involving all of the right stakeholders to identify the requirements B. Completing and using a product backlog C. Following the stakeholder engagement strategies with the project team D. Performing quality assurance

Answer: B Business Environment - Task 2 - Evaluate/ Deliver Benefits The key words constrained end date denotes a time-boxed or agile approach most likely using sprints.

You have been hired as a senior project manager for a defense contractor. You are on a tight schedule and must start the project immediately. Which of the following will you most likely not be involved with as part of your work? A. Identifying stakeholders since you are new to the organization B. Selecting the projects to be initiated C. Balancing demands for time, cost, scope, and quality D. Helping to establish clear and achievable project objectives

Answer: B Business Environment - Task 2 - Lead a Team Project managers typically do not select which projects are to be initiated. The project selection committee, customers, or project sponsors are typically responsible for this. A, C, and D are all incorrect choices because the project manager is responsible for these activities.

You are in the beginning stages of a new project. You have tight deadlines and need to expedite the planning process. Which of the following is the best source of information for your project during the initiation process group? A. Business plans B. Historical information C. Talking with your sponsor D. The project charter

Answer: B Business Environment - Task 3 - Evaluate Scope Changes Historical information is all that really can be utilized at this early point, since planning has not yet occurred.

A market demand, a business need, or legal needs are justifications for which of the following? A. Reasons to have change management B. Reasons to undertake a project C. Reasons to build a team D. Reasons to create a management plan

Answer: B Business Environment - Task 3 - Evaluate Scope Changes Market Demand, Strategic Opportunity/Business Need, Customer Request, Technological Advances and Legal Requirements are all reasons to undertake a project.

What are the phase-end reviews for key deliverables often called? A. Close Project B. Kill points C. Quality audits D. Performance reporting

Answer: B Business Environment - Task 3 - Evaluate Scope Changes Reviews conducted at the end of the project phase on key deliverables and project performance (to determine approval for continuance into the next phase and corrective actions) are often called kill points, stage gates or phase exits.

Robert has been a project manager for a real estate development company for 16 years. He reports directly to the top management and has full authority on his projects. What kind of organizational structure does Robert work in? A. Weak Matrix Structure B. Project-Oriented Structure C. Tight Matrix Structure D. Balanced Matrix Structure

Answer: B Business Environment - Task 3 - Evaluate Scope Changes Robert is working in a project-oriented organization. In projectized organizations, project managers report to top management and have full authority and access to resources.

You are managing an agile project in a functional organizational structure. Who are the team members most loyal to? A. Project manager B. Functional department C. Project sponsor D. End user or customer

Answer: B Business Environment - Task 4 - Support Org Change The team members in a functional organizational structure report to a functional manager, and will thus be most loyal to their functional department.

You are the project manager working with an agile team to develop a new online motor vehicle registration system for the state of New Jersey in the United States. Functional and nonfunctional requirements were collected from the stakeholders. Which of the following would not be an example of a nonfunctional requirement? A. The standard hours and days of the week that the new site will be open and available to motor vehicle owners. B. Response times for the various web pages of the system. C. The types of motor vehicle registrations that will be supported by the system (cars, trucks, motorcycles, campers, trailers, etc.). D. The login, password, motor vehicle VIN, license plate and other security-related access protocols needed for system access by valid users.

Answer: C Business Environment - Task 1 - Manage Compliance Answers A, B and D, along with business continuity/disaster recovery requirements for the system, are all examples of nonfunctional requirements. Answer C is an example of a functional requirement--what service the system is supposed to provide.

You are working on an agile project and have planned to deal with all compliance requirements at the end of the project. Does this plan adhere to an agile methodology? A. Yes, as long as there are no compliance issues early in the project. B. Yes, this typically occurs in flow-based agile. C. No, compliance a part of each retrospective to ensure goals are being met throughout the project. D. No, compliance it only the function of the PMO and is not to be included in agile planning.

Answer: C Business Environment - Task 1 - Manage Compliance Compliance like risk management is woven into each iteration of an agile project. Read more about Compliance in the PMBOK Guide on p. 276.

Your company performs some tests to determine how long it will take to complete the process of creating a new microchip. These tests must be completed and the data analyzed three weeks before the facility design is finalized. This is an example of what? A. Historical information B. Product analysis C. Constraints D. Assumptions

Answer: C Business Environment - Task 1 - Manage Compliance Constraints are factors that limit the options or progress of the project. In this case the requirement that the test be complete and the data be analyzed is a constraint on completing the project.

You are preparing your quality management plan and are referring to various standards and regulations which govern your work. One team member insists that standards and regulations are the same thing, but you know they are not. How will you describe the distinction between the two? A. Standards are internal to the organization while regulations are external B. Standards are regulated by specific industries; regulations are optional. C. Standards are aspirational; regulations are required. D. Standards are required; regulations are laws.

Answer: C Business Environment - Task 1 - Manage Compliance Standards are in most cases aspirational, but practically speaking, they can often be mandatory. Regulations are always mandatory and are backed by some legal or regulatory body (i.e. Food and Drug Administration).

Which of the following is not a tool or technique of Monitor and Control Project Work? A. Trend Analysis B. Decision Making C. Audits D. Alternatives Analysis

Answer: C Business Environment - Task 1 - Manage Compliance The tools and techniques of Monitor and Control Project Work are Expert judgement, Data analysis (Alternatives analysis, Cost-benefit analysis, Earned value analysis, Root cause analysis, Trend analysis, Variance analysis,) Decision making, and Meetings

You are coming to the end of your release and your team is working on what you hope is the final sprint. However, you are informed that a new regulatory requirement has been enacted and there is a possibility that your deliverable may not meet this new regulation. What should you do first? A. Perform an impact analysis of the regulatory requirement. B. Reprioritize user stories so the ones related to the regulatory requirements are higher priority. C. Update the risk register. D. Inform the Product Owner of the new regulations.

Answer: C Business Environment - Task 1 - Manage Compliance You may eventually do all of the above, but the question is asking what you should do first. This is a risk, and once a risk has been identified the first thing to do is update the risk register.

Universal Global Company's construction division has won a contract to build an office park in a busy part of downtown Paris. You are excited that you were elected to create a program for the development of the buildings. You have managed projects in the past, but this is your first real exposure to a program. Which of the following best describes a program? A. A standardized approach to project management that ensures alignment with the portfolio of the organization B. A standardized approach to project management with multiple projects coordinated together C. A collection of related projects managed in coordination to gain control that would not necessarily be available if the projects were managed independently D. A collection of unrelated projects all contributing to the strategic objectives of the organization

Answer: C Business Environment - Task 2 - Evaluate/ Deliver Benefits A program is a collection of related projects managed and coordinated to gain a higher level of control. A, B, and D do not accurately describe a program.

Your project has had multiple changes made to the project charter. Who has the primary responsibility to decide if these changes are necessary? A. Project Champion B. Project Team C. Project Sponsor D. Project Manager

Answer: C Business Environment - Task 2 - Evaluate/ Deliver Benefits Changes to the project charter (if needed) would involve a fundamental change to the purpose/mission of the project, and the sponsor should be the one to approve such changes. Changes to the project charter should occur rarely, if ever.

You have just started working for an organization and you are currently in a meeting that you feel is quite lengthy. Since this is your first week at the company you do not know most of the attendees but are hearing phrases such as, this meets the definition of done and this is the product backlog as it now stands. Most likely, which meeting are you in? A. Daily Standup Meeting B. Sprint Retrospective C. Sprint Review D. Sprint Planning

Answer: C Business Environment - Task 2 - Evaluate/ Deliver Benefits The key is this meets the definition of done which implies that this is the product owner speaking and accepting the deliverable, which occurs in the Sprint Review. Additionally, the product owner can also discuss the remaining product backlog items. It is not the Daily Standup since that is only 15 minutes (the scenario states this meeting is lengthy) and it is not sprint planning since you are already delivering the product to the product owner. A Sprint Retrospective is a lessons-learned meeting. PMI Authorized PMP Exam Prep Student Guide/ Page 260

You know your organization must choose projects that will be the most profitable for the company. This approach to project selection is based on which one of the following? A. Dynamic algorithms B. Opportunity cost C. Economic model D. Pareto diagraming

Answer: C Business Environment - Task 2 - Evaluate/ Deliver Benefits This is a simple economic model of choosing the most profitable project for the organization. Dynamic algorithms are an example of constrained optimization methods. While this question hints at opportunity cost, this is not the best choice. Opportunity costs describe the scenario when an organization has two or more projects to choose from and they can only do one project because of time or limited resources. Pareto diagraming is not a valid option for this question, as it pertains to quality matters

You are a project manager in an Information Technology (software) company, but you recently got an offer as a project manager in a construction company with a 45% salary hike. You have excellent technical knowledge in the software field, but do not have much exposure to the Construction Industry. In this context, A. You should present the new opportunity to your current employer in order to negotiate a higher salary B. You should not take up the assignment because you will lose out on the experience and skills gained in the information technology field C. You should take up the assignment (but seek out any needed training) because similar project management skills will be required in the construction company as were required in the software company D. You should accept the opportunity, not mention your potential knowledge gap and seek necessary training as soon as you start

Answer: C Business Environment - Task 3 - Evaluate Scope Changes According to PMI, project management skills span across industries and the knowledge gained in one industry can be used in other industries. A project manager need not be technically qualified in the industry to succeed. You are already an expert in project management, and managing construction work might be new, however, this can be easily managed. You should be sure to inform your sponsor of your lack of subject matter knowledge

Michael has been in the construction industry for over 12 years. He has just moved to a new job as an application development project manager after recently finishing his PMP. Where can he find information about project history and procedures? A. Annual Report and Industry publications B. Project Management Plan & Project Charter C. Organizational Process Assets & Corporate Knowledge Base D. Organizational Procedures Assets & Enterprise Environment Factors

Answer: C Business Environment - Task 3 - Evaluate Scope Changes Michael can use any Organizational Process Assets as well as the Corporate Knowledge Base to find information about project history and procedures.

On agile projects, the product owner has several duties and responsibilities. Chief among those duties is ownership of the product backlog. Which of the following additional duties is not the responsibility of the product owner? A. Responsible for defining and prioritizing the user stories with the help of the team. B. Answers team questions about the needed solution. C. Provides relative sizing estimates for the user stories in the product backlog. D. Accountable for the ultimate business value of the solution produced by the project team.

Answer: C Business Environment - Task 3 - Evaluate Scope Changes The agile team is responsible for determining the relative estimates for agile projects. The product owner may or may not participate in that process.

A new government regulation has recently gone into effect which will have a serious impact on the way you had planned to complete your project work. For the project to move forward and be in accordance with the new regulation, your next action should be which of the following? A. Prepare a new project management plan which aligns with the new regulation B. Notify management of the new regulation C. Prepare a change request outlining the change required by the regulation D. Create a feasibility study

Answer: C Business Environment - Task 3 - Evaluate Scope Changes While the change clearly needs to be made, you should still follow the formal change control procedures, which would include creating a change request and submitting it to the change control authority.

You are the project manager and your company consistently completes projects for other companies. Within your organization the project managers have the highest level of authority on a project. You are likely operating within what type of organizational structure? A. A functional structure B. A weak matrix structure C. A project-oriented structure D. A company using an ISO 9000 program

Answer: C Business Environment - Task 4 - Support Org Change In a project-oriented organizational structure, the project manager has the highest authority level and will often perform projects for various organizations.

which of the following does this refer? A. Work Breakdown Structure (WBS) B. Project Management Information System (PMIS) C. OPM3 D. Project Management Research

Answer: C Business Environment - Task 4 - Support Org Change OPM3 (Organizational Project Management Maturity Model) helps organizations determine their level of maturity in project management. OPM3 is a globally-recognized best practice standard for assessing and developing capabilities in Portfolio Management, Program Management, and Project Management.

Your organization has just adopted agile as a project methodology. Several critical changes will affect your role as Project Manager. What will be key to your success in the adoption of the new methodology? A. Understanding the agile terms. B. Documenting all mistakes so you can get the organization to change back to the way things were. C. Having an agile mindset. D. Live the agile values.

Answer: C Business Environment - Task 4 - Support Org Change See Agile practice guide, p.33.

A project manager in Detroit is having difficulty getting the engineers in his company's Detroit office to complete design documents for his project. He has sent numerous requests to the VP of Engineering (also in Detroit) for assistance in getting the design documents, but so far his efforts have been unsuccessful. What kind of organization does this project manager work in? A. Strong Matrix B. Tight matrix C. Functional D. Projectized

Answer: C Business Environment - Task 4 - Support Org Change The clue to this question is the project manager's low authority, which implies a functional organization. The PM must appeal to the head of the engineering department rather than making his request directly to the team members. In both a strong matrix and projectized organization, the project manager would have sufficient authority to directly manage the engineers. A tight matrix refers to co-location of a project team.

You are the Team Facilitator leading your team through the current sprint. Which of the following tools would not be relevant for measuring compliance to quality standards on an Agile project? A. Design for X B. Ishikawa Diagram C. Pareto Chart D. RACI Chart

Answer: D Business Environment - Task 1 - Manage Compliance A RACI chart is used to show who is Responsible and Accountable, and who need to be Consulted and Informed on activities. The others are all tools for measuring quality. PMI Authorized PMP Exam Prep Student Guide/ Page 257

You are working on an agile project for the Department of Defense. The project will be dealing with sensitive information that requires all team members to have an active security clearance. There are also several other industry compliance issues surrounding the storage of this sensitive information. How can you ensure your project stays in compliance? A. Review the compliance requirements with the team at the outset of the project? B. Hope the compliance auditor has an agile mindset. C. Use a third party to conduct an audit at the end of the project. D. Make compliance a part of each retrospective to ensure goals are being met throughout the project.

Answer: D Business Environment - Task 1 - Manage Compliance A and C are good answers but D is the best answer available. Read more about Compliance in the PMBOK Guide on p. 276.

Which of the following would be used to describe the qualitative significance of the negative impact of threats or the positive impact of opportunities each project faces? A. Dollar amounts B. Length of expected delays C. Types of risk responses D. Very Low, Low, Moderate, High

Answer: D Business Environment - Task 1 - Manage Compliance Relative scales of assessed risk parameters and their potential effects to various project objectives are rank-ordered to differentiate risks that require special attention from lesser risks. Risk probabilities and impacts are assessed using the definitions given in the risk management plan, and could be listed as low, moderate, high, etc. This is done via the Perform Qualitative Risk Analysis process.

You are a project manager with a mid-sized retail company. You are performing structured independent reviews to ensure compliance with the project's quality policies and procedures. Which of the following is true about the process this describes? A. It is the process of monitoring and recording results of executing the quality activities to assess performance. B. It identifies causes of poor process or product quality and recommends action to eliminate them. C. It sets forth the way in which the team will meet the quality requirements. D. It ensures appropriate quality standards and operational definitions are used.

Answer: D Business Environment - Task 1 - Manage Compliance This question is describing audits, which are used in the Manage Quality process.

For agile projects, the product owner defines the initial functionality or capabilities that make up a minimum business increment. Release planning determines how many sprints will be included in a release, and how many releases will be done for the project. Which of the following typically has the least impact on release planning? A. Availability of a set of features or capabilities. B. Organizational tolerance for changes. C. A time cadence for subsequent releases. D. The velocity of the agile team(s).

Answer: D Business Environment - Task 2 - Evaluate/ Deliver Benefits Agile team velocity determines how many user stories or story points the team can deliver within a time boxed sprint/iteration.

A company is considering an investment of $110,000. There is a 50% probability that the investment will perform well, and a 50% probability it will perform poorly. If it performs well, the payoff will be $150,000 one year from now. If it performs poorly, the payoff will be $70,000 one year from now. Assuming a 10% discount rate, should the company make this investment? A. Yes, since 150,000 > 110,000 B. Yes, since (150,000 + 70,000) > 110,000 C. No, since there is no probability of a loss D. No, since NPV is negative

Answer: D Business Environment - Task 2 - Evaluate/ Deliver Benefits First we need to compute the PV for both poor and good performance: PV = FV / (1 + i) ^n (where i is the discount rate and n is the number of years); PV for poor performance = 70,000 / 1.10 = 63,636; PV for good performance = 150,000 / 1.10 = 136,363; Next we take the net impact and multiply by the probability: Poor performance: NPV = (63,636 - 110,000) * 50% = $-23,182; Good performance: NPV = (136,363 - 110,000) * 50% = $13,181; Then we net the two numbers: $13,181 + (23,182) = ($10,001); Since the combined NPV is negative, we should not do this project.

Who is usually responsible for portfolio management within an organization? A. Project managers B. Project sponsors C. Stakeholders D. Senior management

Answer: D Business Environment - Task 2 - Evaluate/ Deliver Benefits Portfolio Management focuses on achieving an organization's strategic business objectives. Thus, senior management is usually responsible for portfolio management.

The assurance a product, service or system meets the needs of the customer is? A. Verification B. Justification C. Association D. Validation

Answer: D Business Environment - Task 2 - Evaluate/ Deliver Benefits Verification is the evaluation of whether or not a product, service, or system complies with a regulation, requirement, specification, or imposed condition. Justification would be the support and reason for doing the projec

Your organization has started to transition to a visual work place. As a project manager, what are some methodologies you would recommend? A. Monte Carlo B. Standard Deviations C. Nominal Grouping Methods D. Kanban

Answer: D Business Environment - Task 3 - Evaluate Scope Changes A Kanban is a method for managing knowledge work with an emphasis on just in time delivery without overloading a team member. The four principles are visualizing work, limit work in progress, focus on flow and continuous improvement. Standard deviations are used to estimate the distance from the mean. Monte Carlo is an application to determine the probability of risk. Finally, the nominal grouping method is a brainstorming technique used to gather information.

A technological advance, legal requirement or social need are best described as which of the following? A. Issues that need to be managed in the project plan B. Environmental factors that usually have detrimental effects on the project C. Risks that have to be managed by the project manager D. Factors creating the need for a new project which may be authorized by an organization

Answer: D Business Environment - Task 3 - Evaluate Scope Changes Projects are usually authorized as a result of one or more of the following: meet regulatory, legal, or social requirements; satisfy stakeholder requests or needs; implement to change business or technological strategies; and create, improve, or fix products, processes, or services.

Tabitha is a project manager and is currently facilitating a project in a functional organization structure. She has been managing virtual global project teams for 5 years and is very good at what she does. She is considered one of the most experienced and valuable project managers in the organization. What do you know about Tabitha's role in the project? A. Resource availability will be limited and her role is full-time B. Resource availability will not be limited and her role is full-time C. Resource availability will not be limited and her role is part-time D. Resource availability will be limited and her role is part-time

Answer: D Business Environment - Task 3 - Evaluate Scope Changes Tabitha is in a functional organizational structure, and thus she will have a part-time role and resource availability will be limited. In this setting, the functional manager will have primary control.

You believe the original schedule baseline is no longer feasible in light of several delays you have encountered which were beyond your control. Which of the following must provide approval for your proposed modification of the schedule baseline? A. Sponsor B. Project Team C. Program manager D. Change control board

Answer: D Business Environment - Task 3 - Evaluate Scope Changes The change control board must approve changes made to any project plans. While some projects may have change control systems in place allowing the project manager to approve certain smaller changes herself, this scenario represents a change to a project baseline and would have to be approved by the change control board.

You are working with your team to remove user stories that are no longer relevant, reassessing priorities of existing user stories and correcting estimates of user stories in light of new information. What are you performing? A. Sprint Planning B. Backlog Modification C. User Story Prioritization D. Backlog Grooming

Answer: D Business Environment - Task 3 - Evaluate Scope Changes The correct term is Backlog Grooming (or Backlog Reprioritization) where you are reprioritizing user stories based on new information, changing requirements and many other factors. You may do this during sprint planning but the actual procedure you are performing is called Grooming. B and C are made up terms.

Mark, the product owner, has created a product road map that depicts in broad strokes the scope of the project. During the project, more requirements have been discovered that will help the team add business value but these requirements will not line up with the road map created by the product owner. What should be done? A. If the new requirements are not represented on the product road map they should be removed because they are out of scope. B. If the new requirements add business value they should be completed by the team. Informing the product owner can be done after delivery. C. If the new requirements add business value but are not reflected in the product road map a new project should be considered to make a new product road map. D. If the new requirements are not on the product road map they should be discussed by the team and product owner in the next backlog refinement. If agreed to the product road map can always be changed to add business value.

Answer: D Business Environment - Task 3 - Evaluate Scope Changes The product road map can be changed. It is designed to be changed or refined as the project moves forward. Read more about this in the Agile Practice Guide p. 52.

You are a project manager in a weak matrixed organization. A new functional manager seems to be confused regarding the difference between projects and operations, and has asked for your input. Which of the following would not be applicable to projects in weak matrixed organizations? A. Constrained by limited resources B. Planned, executed and controlled according to stakeholder needs C. Creates a unique product or service D. Led by the functional manager since it is a weak matrixed organization

Answer: D Business Environment - Task 4 - Support Org Change A project is a temporary endeavor undertaken to create a unique product, service or result. "Temporary" means that every project has a definite beginning and a definite end, as opposed to operations, which are ongoing. A project is also constrained by limited resources and it is planned, executed and controlled. Answer D is the correct answer here because who manages the project does not determine if it is a project or not, regardless of the organizational structure.

You are a project manager new to a functional organization. You have mainly worked in projectized organizations and are concerned that you will not fit in with the organizational culture. Your sponsor explains to you that one of the advantages of a functional organization is: A. Project team members are usually loyal to the project, not a functional manager. B. Project team members are usually loyal to the project manager. C. Project managers usually yield a great deal of formal authority in a functional organization. D. All of the employees report to one manager and have a clear chain of command.

Answer: D Business Environment - Task 4 - Support Org Change Advantages for employees in a functional organization are that they have one supervisor and a clear chain of command exists. None of the other choices are representative of a functional organization.

You are the project manager on an agile team that has completed six out of a planned eight 2-week sprints that will make up the first release of your company's new automated project resource request system. Since there is only a month left to go before the system will be available for all end users in the company, you will need an Implementation/Rollout Plan. Which of the following items is typically not included in such a plan? A. Training plan for end users B. Product demonstration schedule C. List of all end users by department and job function D. Strategies for handling resistance to adoption and utilization of the new system

Answer: D Business Environment - Task 4 - Support Org Change How resistance to adoption and utilization will be handled is included in a (Organizational) Change Management Plan. This plan differs from the Change Management Plan that is a component of the Project Management Plan, which addresses how project or product change requests will be handled throughout the project life cycle. An Organizational Change Management Plan addresses how the organization deals with sponsorship, cultural, capacity, maturity and resistance issues. This is the people side of change which many project implementations trigger--especially when they dramatically change the way the company conducts its business, and people have to change their behaviors accordingly.

Your organization has been working to mature the project management culture and new leadership approaches. In addition to building up a culture where timely feedback and participation is important, it is also looking to build a culture of efficiency so time is not wasted in the decision making process nor in the production of too much detail in supporting documentation. Among other methods, MBO is being considered as a possible approach. Which of the following is true of management by objectives (MBO)? A. The supervisor establishes performance objectives. B. The supervisor sets the general objectives and the subordinate reviews and agrees to them. C. Objectives do not need to be quantifiable. D. The supervisor and the employee jointly establish performance objectives

Answer: D Business Environment - Task 4 - Support Org Change Management by objectives (MBO) are a necessity in every area where performance and results directly affect the survival and growth of a business. MBO emphasizes the importance of participative goal-setting, self-control and self-evaluation. While this is not a PMBOK term, it is a commonly-used term in project management and thus could be tested on the exam.

You are the Project Manager for an organization that embraces changes to the business environment. More than likely what type of organization do you work for? A. Functional B. Weak Matrix C. Tight Matrix D. Projectized

Answer: D Business Environment - Task 4 - Support Org Change Most likely this would describe Projectized. That is not to say that Functional or Weak Matrix do not embrace change. Both Functional and Weak Matrix normally refer to ongoing operations type work with few projects, whereas Projectized organizations only work on projects. Projects are all about change and so that would be the best answer. Remember you will not always get perfect answers (or perfect questions for that matter), you have to choose the best out of an ambiguous situation. Tight matrix refers to the team being co-located (not a type of organization). PMI Authorized PMP Exam Prep Student Guide/ Page 275

Your project's primary constraint is time. One of your key stakeholders, who is a major contributor on this project, is demanding the schedule be lengthened. He held his department picnic last weekend, and three of his staff members came down with H1N1 virus. The team members he's assigned to your project (who didn't contract the virus) must now do double duty and help support the department functions until their co-workers get well. Your customer will not agree to a schedule change. Which of the following statements is false given the facts in this question? A. The project manager has the weakest amount of power and authority in this type of organization. B. The project manager should try to resolve the problem such that it doesn't affect the project schedule. C. This company's organizational structure is functional, since the department manager is responsible for assigning resources to the project. D. The project manager should work with the stakeholder to resolve the problem and negotiate with the customer to change the schedule.

Answer: D Business Environment - Task 4 - Support Org Change When problems arise on a project, they should be resolved in favor of the customer whenever possible. This organization is a functional organization, as the department manager is responsible for assigning resources, which means the project manager lacks authority to do what D suggests.