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Q:

You are a project manager for the redevelopment of the Hoover Dam. Your team has been provided with the scope statement, but it lacks many description details. Your team is concerned because the project is in the initiation phase and it wants to postpone it until it has more information. As the project manager, you recommend that

A) The team should go forward, but be caution about the lack of details and the impact upon the timeline for the project B) The project should not go forward until the stakeholders agree about the scope and purpose of the project
C) The team should verify the scope and realize that more details will be available as more project characteristics are progressively elaborated. D) The team should review the project selection criteria for the Hoover Dam project
 
Answer & Explanation Answer: C) The team should verify the scope and realize that more details will be available as more project characteristics are progressively elaborated.

Explanation:

The project details and description will usually have less detail at the beginning of the project and will increase as the characteristics are progressively elaborated. Answer A is incorrect because the team should confirm that they understand the esence of the scope of the project, even if the details might be ambiguous at the beginning of the project. Answer B is incorrect because the project should go forward; however, the team should request further clarification of what the project scope entails. Answer D is incorrect because the project selection criteria should be established before the project begins.

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Q:

Subject matters experts (SMEs) are resources that are imperative to the succes of a project. Many times, project managers are not experts in the areas they are managing and frequently must rely upon other's expertise. In which scope - management process are SMEs first used?

A) Scope planning B) Scope definition
C) Initiation D) Scope verification
 
Answer & Explanation Answer: C) Initiation

Explanation:

Initiation is the first step in the scope management process, and expert judgment is one of the techniques routinely utilized. Answers A, B, and D are incorrect because they would come after the initiation process.

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Q:

Project authorization is one of the processes that is associated with the initiation phase of a project. Authorization can come in many different forms, and projects are generally authorized by all of the following except

A) Technological Advances B) Customer request or market demand
C) Executive year - end bonuses D) Business or Social needs
 
Answer & Explanation Answer: C) Executive year - end bonuses

Explanation:

Project authorization should not be exclusively based upon the impact of an executive's bonus (many people would agree that it should not ever be based upon an executive's bonus). Answer A, B, and D are common events that predicate the need for project authorization and can evolve into large scope projects.

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Q:

A project charter is one of the key deliverables to come from the initiation process. The project charter should by issued by 

A) one or more functional managers B) The head of the performing organization
C) A manager external to the project D) The CFO
 
Answer & Explanation Answer: C) A manager external to the project

Explanation:

The other answers could be accurate in specific situations, but their role alone does not meet the keyb criterion of being "external" to the project team. Answers A, B, and D are incorrect because these individuals are not external to the project.

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Q:

Sometimes project managers forget all of the expenses that they can incur on a project, such as capital resources and assets. This can have an impact upon their budgets and the economic return on the project. A cost that has been incurred and cannot be reversed is known as a 

A) Fixed Cost B) Direct Cost
C) Variable Cost D) Sunk Cost
 
Answer & Explanation Answer: D) Sunk Cost

Explanation:

Answer D is correct because a sunk cost is a project expense that will eventualy need to be paid. Answer A is incorrect because a fixed cost remains constant, regardless of any change in a company's activity. Answer B is incorrect because direct cost can be directly linked to producing specific goods or services. Answer C is incorrect because a variable cost changes in proportion to a change in the company's activity or business.

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Q:

The payback period can become an important issue when a large scope project is developed over several years. Maureen has been assigned the responsibility of calculating the payback period for her project that is to be completede in 3 years. The internal rate of return(IRR) is 7% and the annual savings will be $800,000 per year. The total cost is $4,000,000 and the rate of return during this time period is 3%. What is the payback period of Maureen's project?

A) 3 years B) 4 years
C) 5 years D) 13.3 years
 
Answer & Explanation Answer: C) 5 years

Explanation:

The payback period is how long it takes to recoup your investment. In this example, the cost was $4,000,000 and the savings was $800,000 per year. $4,000,000/$800,000 = 5. Therefore, Answer A, B and D are incorrect.

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Q:

One of the goals of management by objectives (MBO) is to ensure that objectives of one level within an organization are supportive of and aligned with the objectives of another level of the organization. This methodology has been popular within some organizations as they define their culture. Which of the following is not true about MBO?

A) It has a top-down orientation B) Corrective actions are not part of the process
C) You need to establish clear and achievable objectives D) MBO is a natural fit for Project Management
 
Answer & Explanation Answer: B) Corrective actions are not part of the process

Explanation:

Corrective actions are part of the process after establishing objectives and checking on the objectives. The next step is to take corrective actions. Answers A, C, D are true statements and therfore are incorrect for this question.

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Q:

You have started your own company based upon PMI methodologies and have been contracted by the government to develope a new interface for one of its computer applications. You develope a solution and win the bid for the contract but encounter problems at the end of the project when the customer says that you did not fullfill their needs. You are throughly shocked. What is your conclusion of the situation?

A) There are always more customers available B) If the customer is not satisfied, the project is not successful
C) Change control management was not effective D) The customer did not communicate very well
 
Answer & Explanation Answer: B) If the customer is not satisfied, the project is not successful

Explanation:

Answer A is incorrect because without satisfied customers, we do not have potential for new projects. Answer C is incorrect because the change control management process would have likely resolved this problem. Answer D is incorrect because it is the project manager's responsibility to seek communication with the customer to set realistic expectations.

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