Project Management Chapter 6
________ is a good estimating technique to use when a project has aspects that are similar to previous projects, and a calculation can be used that is based on historical data. a. Parametric estimating b. Analogous estimating c. Three-point estimating d. Reserve analysis
a. Parametric estimating
Meredith is soliciting bids from suppliers for an upcoming project. These suppliers want a detailed description of the items that they will be providing so they can figure out if they're capable of providing the items requested. What should Meredith do? a. Send them a procurement statement of work. b. Develop source selection criteria. c. Sign them to a contract. d. Show them the project management plan.
a. Send them a procurement statement of work.
________ are used to rate or score seller proposals. a. Source selection criteria b. Plan contracts c. Project schedules d. Cost baselines
a. Source selection criteria
True or False? A project manager who works for a risk-averse organization should establish larger project contingency reserves. a. True b. False
a. True
True or False? Quality control focuses on uncovering defects, while quality assurance focuses on improving processes to prevent defects. a. True b. False
a. True
True or False? Quality management practices should be designed into a project, not added on to it. a. True b. False
a. True
True or False? Successful contract negotiations can set a positive mood for the onset of a project. a. True b. False
a. True
A CPI value of a project is greater than 1.0. This indicates ________. a. a cost underrun of performance to date b. less work was completed than was planned c. a cost overrun for work completed d. more work was completed than was planned
a. a cost underrun of performance to date
What is a procurement statement of work? a. a detailed description of procurement items that vendors will use to assess their own capability b. a legally binding agreement that links buyers and sellers on a project c. a cost-variance tool for assessing supplier performance d. a flowchart that shows delivery dates for all items purchased from suppliers
a. a detailed description of procurement items that vendors will use to assess their own capability
What is an affinity diagram? a. a tool for sorting data into categories b. a chart that shows how much project stakeholders like each other c. a matrix that shows the strength of the relationships between items d. an illustration of process results over time
a. a tool for sorting data into categories
What is the work breakdown structure (WBS) component used for a project's cost accounting system called? a. control account b. level of accuracy c. control thresholds d. units of measure
a. control account
What is the technique used to determine the costs incurred to ensure quality? a. cost of quality (COQ) b. performing quality control (QC) c. quality assurance (QA) d. quality metrics
a. cost of quality (COQ)
A ________ contract is a type of legally binding agreement where the buyer pays a set amount to the seller, regardless of seller costs. a. fixed-price b. cost-reimbursable c. flexible d. time and material
a. fixed-price
The amount of money beyond an amount invested that an investor takes as income is called ________. a. return on investment b. rate of return c. benefit costing d. benefit cost ratio
a. return on investment
What most directly influences the cost and accuracy of bottom-up cost estimating? a. size and complexity b. expertise c. historical data d. vendor analysis
a. size and complexity
Which one of the statements below does not correctly complete the following statement? If a buyer approaches a seller to procure a product that is not a common product of the seller ________. a. the buyer becomes the seller and is a key project stakeholder for the seller b. the buyer becomes the customer and is a key project stakeholder c. the seller's project team is concerned with all the processes of project management d. the terms and conditions of the contract become key inputs
a. the buyer becomes the seller and is a key project stakeholder for the seller
Maxim is developing an EAC forecast and he expects that future work packages will be completed at the same rate that work packages have been completed so far. Which equation should he use for his forecast? a. AC + (BAC - EV) b. BAC/CPI c. AC + [(BAC-EV)/(CPI x SPI)] d. CPI x SPI
b. BAC/CPI
True or False? Management reserves cover "known unknown" risks. a. True b. False
b. False
True or False? Quality management practices should focus solely on the processes used to create a product. a. True b. False
b. False
True or False? The PMB S-curve is a graphic representation of the earned value on a project. a. True b. False
b. False
True or False? The to-complete performance index is used when the team needs to determine what performance would be necessary to finish the project on schedule. a. True b. False
b. False
What process is not included in Project Quality Management? a. Control Quality b. Identify Work Performance Measurements c. Plan Quality Management d. Manage Quality
b. Identify Work Performance Measurements
________ is a reactive response to a project problem, while ________ is a proactive response. a. Forecasting; quality management b. Quality control; quality assurance c. Quality assurance; quality control d. Cost of quality; nonconformance
b. Quality control; quality assurance
On her project, Ivory multiplied the CPI by the SPI and got a value of 1.07. What does this suggest? a. The project is running exactly as expected. b. The project is running better than expected. c. The project is running worse than expected. d. Multiplying the CPI by the SPI does not provide any useful information about the project.
b. The project is running better than expected.
experienced practitioners to estimate future activities and costs? a. bottom-up estimating b. analogous estimating c. parametric estimating d. forecast estimating
b. analogous estimating
What is not an input in the Estimate Costs process? a. enterprise environmental factors b. basis of estimates c. organizational process assets d. risk register
b. basis of estimates
Why do you need quality control processes if your quality assurance measures are effective? a. because you can't complete a quality assurance process without doing quality control first b. because defects can still occur, even with the best quality assurance processes in place c. because quality assurance activities are reactive while quality control practices are proactive d. because quality assurance is composed of both quality management and quality control
b. because defects can still occur, even with the best quality assurance processes in place
A practitioner has identified how much her project can vary from its cost baseline before some form of corrective action would be needed. Where would she document this information? a. in the work breakdown structure b. in the cost management plan c. in the time-and-material contract d. in the cost-of-quality documents
b. in the cost management plan
What is the general management technique used to determine whether particular work can best be accomplished by the project team or should be purchased from outside sources? a. lease-or-make analysis b. make-or-buy analysis c. budget d. expert judgment
b. make-or-buy analysis
The SPI is a comparison of earned value and ________, while the CPI is a comparison of earned value and ________. a. schedule variance; cost variance b. planned value; actual cost c. actual cost; planned value d. critical ratio; cost variance
b. planned value; actual cost
Contingency reserves are estimated costs to be used at the discretion of the project manager to deal with _______ events. a. scheduled b. possible but uncertain c. unanticipated d. certain
b. possible but uncertain
A(n) ________ is a component-specific, structured tool that verifies that a set of steps has been performed. a. quality metric b. quality checklist c. quality audit d. inspection
b. quality checklist
Bidder conferences are used to ensure that all prospective _________ have a clear understanding of the procurement. a. buyers b. sellers c. project managers d. advertisers
b. sellers
A project manager is reviewing how well a company could back up its work with recommendations from customers it has worked with in the past. What is he evaluating? a. a procurement statement of work b. source selection criteria c. a time and material contract d. organizational process assets
b. source selection criteria
Who performs quality management activities in an Agile project? a. the project sponsor b. the team members c. the project manager d. the quality assurance department
b. the team members
Which of the following is not a common type of cost-reimbursable contract? a. cost plus award fee (CPAF) b. time and material (T&M) c. cost plus fixed fee (CPFF) d. cost plus incentive fee (CPIF)
b. time and material (T&M)
Why do teams calculate a to-complete performance index (TCPI)? a. to illustrate how often products need to be produced to match customer demand b. to forecast how much it will cost to complete an ongoing project without changing the target budget c. to numerically assess a project's critical path d. to evaluate a company's quality control processes
b. to forecast how much it will cost to complete an ongoing project without changing the target budget
A scatter diagram shows the pattern of relationship between ________ variables. a. three b. two c. four d. six
b. two
If the project has a rough order of magnitude (ROM) estimate of ± 50% in the initiation stage, what is the most likely ROM later in the process? a. ±70% b. ±10% c. ±50% d. ±90%
b. ±10%
If a company earns a profit of $120,000 on an investment of $600,000, what is the ROI? a. 10% b. 15% c. 20% d. 25%
c. 20% ROI = Profit/Investment
_______ describes the procurement item in sufficient detail to allow prospective sellers to determine if they can provide the products, services, or results. a. Make-or-buy b. Cost plus fixed fee (CPFF) c. A statement of work (SOW) d. Cost plus incentive fee (CFIP)
c. A statement of work (SOW)
In which process are procurement activities measured against project plans? a. Plan Procurement Management b. Conduct Procurements c. Control Procurements d. Close Project or phase
c. Control Procurements
What process is not included in Project Cost Management? a. Determine Budget b. Control Costs c. Control Schedule d. Estimate Costs
c. Control Schedule
Kentaro is using a bar chart to prioritize the factors that are causing quality problems on his project. What is this chart called? a. a tree diagram b. a scatter diagram c. a Pareto diagram d. a process decision program chart
c. a Pareto diagram
Which of the following would not be considered a procurement document? a. an invitation for bid b. a request for proposal c. a code of accounts d. a procurement statement of work
c. a code of accounts
Two organizations have agreed to work with each other. The buyer has agreed to reimburse the seller for all costs incurred, with an additional fee included for seller profit. The additional fee will be based on the buyer's subjective evaluation of the seller's performance. What type of contract would best cover this agreement? a. a cost plus incentive fee contract b. a cost plus fixed fee contract c. a cost plus award fee contract d. a time and material contract
c. a cost plus award fee contract
Which tool shows the cause-and-effect relationships for non-numerical data? a. an affinity diagram b. a control chart c. an interrelationship digraph d. a Pareto diagram
c. an interrelationship digraph
Costs of quality are typically separated into what two categories? a. fixed-price and cost-reimbursable b. critical path and non-critical path c. conformance and nonconformance d. integrative and disjoined
c. conformance and nonconformance
If a project manager is using statistical sampling as part of a project's quality control measures, when should the sample size and sampling frequency be determined? a. at the end of the Manage Quality process b. during project charter development c. during the Plan Quality Management process d. at the beginning of the Control Quality process
c. during the Plan Quality Management process
What should the results of inspection in quality control include? a. technical performance b. defect c. measurement d. scatter diagram
c. measurement
A contract is a _________ binding agreement that obligates the seller to provide the specified products, services, or results, and obligates the buyer to provide monetary or other valuable considerations. a. marketing b. subcontractual c. mutually d. contractually
c. mutually
The performance measurement baseline is a graphic representation of the ________ of a project. a. earned value b. actual cost c. planned value d. schedule variance
c. planned value
Which of the following items would a project management team not do if the BAC turns out to be unrealistic at the current level of productivity? a. calculate the ETC b. calculate the TCPI c. recalculate the BAC d. cancel the project
c. recalculate the BAC
Which of the following is generally determined by a legal agreement or contract? a. the control limits on a control chart b. the control limits on a flowchart c. the specification limits on a control chart d. none of the above
c. the specification limits on a control chart
A(n) ________ estimate averages three duration estimates representing the optimistic, most likely, and pessimistic scenarios. a. parametric b. analogous c. three-point d. reserve
c. three-point
When analyzing the performance measurement baseline, if the line for actual costs falls below the line for earned value, the project is ________. a. behind schedule b. over budget c. under budget d. ahead of schedule
c. under budget
Good quality management practices ensure that a project ________. a. will be completed within the approved budget b. will finish on time c. will meet the needs for which it was designed d. will increase the project's critical ratio
c. will meet the needs for which it was designed
If a $5,000 computer has a scrap value of $100 and will be held for five years, its depreciation per year is ________. a. $50 b. $100 c. $530 d. $980
d. $980 ($5000 - $100) / 5 years = $4900 / 5 = $980.
Which of the following statements is true? a. In an Agile methodology, the use of small batches may help to uncover quality problems early in the project life cycle. b. A project's quality measures and techniques are specific to the type of deliverables it produces. c. Cost-of-quality decisions may be overseen by a project management office. d. All of the above
d. All of the above
Which one of these statements about procurement negotiations is incorrect? a. Negotiations clarify the structure, requirements, and other terms of the purchases so that mutual agreement can be reached prior to signing the contract. b. Contract negotiation can be an independent process with inputs and outputs of its own. c. The terms and conditions of the contract can be previously set and nonnegotiable, and only need to be accepted by the seller. d. Procurement negotiations conclude with a contract document that can be executed by the buyer only.
d. Procurement negotiations conclude with a contract document that can be executed by the buyer only.
What happens to the quality requirements that are identified in the Plan Quality Management process? a. They are submitted to the project's integrated change control process. b. They are used to determine whether quality costs should be considered conformance costs. c. They are used to determine whether quality costs should be considered nonconformance costs. d. They are turned into the test and evaluation instruments used in the Control Quality process.
d. They are turned into the test and evaluation instruments used in the Control Quality process.
Inspection is an example of a(n) ________. a. internal failure cost b. meaurement and test equipement cost c. nonconformance cost d. appraisal cost
d. appraisal cost
The target budget that a project team hopes to complete a project within is called the ________. a. estimate at completion b. estimate to complete c. to-complete performance index d. budget at completion
d. budget at completion
If an organization has decided that it only wants to work with local companies on an upcoming project, what category of source selection criteria would this fall under? a. understanding of need b. management approach c. technical approach and capability d. business size and type
d. business size and type
Cost variance is equal to ________. a. earned value (EV) minus the planned value (PV) b. planned value (PV) minus the actual costs (AC) c. actual costs (AC) minus the earned value (EV) d. earned value (EV) minus the actual costs (AC)
d. earned value (EV) minus the actual costs (AC)
What element in a contract is not negotiable? a. cost b. time c. scope d. none
d. none
Which of the following is not an enterprise environmental factor for the Conduct Procurements process. a. local procurement laws and regulations b. marketplace conditions c. prior agreements in place d. organizational policies for seller selection
d. organizational policies for seller selection
Which one of these items is not a tool and technique in the Plan Quality Management process? a. benchmarking b. design of experiments (DOE) c. cost of quality (COQ) d. organizational quality policies, procedures, and guidelines
d. organizational quality policies, procedures, and guidelines
Keegan is taking a proactive approach to quality management by preventing defects from occurring, rather than waiting to uncover defects and to fix them before they can reach the customer. What quality management approach is he using? a. Pareto processing b. critical path analysis c. quality control d. quality assurance
d. quality assurance
The project scope statement is an input to the Estimate Costs process because it is part of the scope baseline. Which of the following is not described in the project scope statement? a. product description b. assumptions and constraints about the project c. key deliverables d. reserve analysis
d. reserve analysis
Brooke is developing a set of attributes that potential suppliers must meet before they can be chosen as a project partner. What is she creating? a. appraisal costs b. a firm fixed-price contract c. a stakeholder list d. source selection criteria
d. source selection criteria
Sanjay is adding the expected amount that he would need to finish all of a project's remaining work to the project's actual costs to-date. What is he calculating? a. the estimate to complete b. the atypical variance c. the budget at completion d. the estimate at completion
d. the estimate at completion
IRR can be defined as the discount rate at which the net present value of incremental cash flows is ________. a. 100% b. positive c. negative d. zero
d. zero