Questions

Question 1

Which of the following types of activities is more closely associated with
projects rather than processes?

A) An activity that is ongoing

B) An activity that is day to day

C) An activity that uses existing systems

D) An activity that establishes its own work rules

Answer 1

D)

Question 2

Which of the following is accomplished through project management?

A) A cellular phone company activates a new customer’s service

B) An automotive manufacturer produces a day’s quota of vehicles

C) A software developer creates a new crash proof operating system

D) A retailer restocks the shelves after a day of brisk sales

Answer 2

C)

Question 3

A project typically has

A) A defined start and end date

B) A defined start date but no defined end date

C) No defined start but a defined end date

D) No defined start or end date

Answer 3

A)

Question 4

A project that results in “doing the wrong things well” has ignored the

A) Budgetary goal

B) Technical goal

C) Customer satisfaction goal

D) Scheduling goal

Answer 4

C)

Question 5

Which of these is NOT characteristic of a project?

A) Projects are responsible for the newest and most improved products,
services, and organizational processes

B) Projects are ad hoc endeavors with a clear life cycle

C) Projects provide a philosophy and strategy for the management of change

D) Traditional process management functions of planning, organizing, and
controlling do not apply to project management

Answer 5

D)

Question 6

Which of the following is NOT a project constraint?

A) The budget

B) The customer requirements

C) The schedule

D) The technical specifications

Answer 6

B)

Question 7

Let’s
consider product development What are some of the principal reasons why project management has become
such a popular business tool in recent years?

Answer 7

In
today’s market, the length of product life cycles is shortening This means businesses are under pressure to produce new
or improved products at an increasingly rapid pace Growing global markets, consumer tastes, and competition demand that
products constantly be improved to be better, faster, and sleeker and offer more features Most organizations are planning
their next product or product improvement as their latest innovation is just on its way out the door Under conventional
business practices, keeping up with this demand for innovation can be difficult Project management offers companies a
manner in which to become more innovative and to develop products at a faster pace

Question 8

What
do you see as the primary challenges to introducing a project management philosophy to most
organizations? That is, why is it difficult to shift to a project based approach in many companies?

Answer 8

Many
companies encounter a resistance to change within their personnel that makes implementing a new approach, such as
project based, difficult Employees have to be trained in the new processes and learn to implement it into their current role
Oftentimes, employees are averse to a large shift in current practices due to uncertainty of the outcome

Question 9

What
are key differences between projects and processes (or “ or “or business
as usual”?

Answer 9

A
process refers to ongoing, day to day activities in which an organization engages while
producing goods and services Processes use existing systems, properties, and capabilities in a
continuous, fairly repetitive manner Projects take place outside the normal, process oriented
world of the firm and project management activities remain unique and separate from the manner
in which process oriented work is performed Differences are listed in the table reproduced below

Question 10

The management department at the university decides to
add a new program in restaurant, hotel, and institutional
management. As part of the development process they
hold focus groups consisting of area business leaders,
current and former students, and restaurant and hotel
owners. These groups can be described as:

A) Project leaders.

B) Project workers.

C) Stakeholders.

D) Clients.

Answer 10

C)

Question 11

External stakeholders that are external to a project but possess
the power to effectively disrupt the project’s development are:

A) Intervenor groups.

B) Environmental groups.

C) Stressor groups.

D) Special interest groups.

Answer 11

A)

Question 12

Which of the following is an internal project stakeholder group?

A) Clients

B) Suppliers

C) Functional managers

D) Competitors

Answer 12

C)

Question 13

Which of the following is an external stakeholder group?

A) Project team members

B) Top management

C) Internal accountants

D) Environmental groups

Answer 13

D)

Question 14

The group that provides raw materials or resources that the
project team needs to complete the project is:

A) Suppliers.

B) Intervenor groups.

C) Top management.

D) Functional managers.

Answer 14

A)

Question 15

Define the term stakeholder and discuss the major groups of stakeholders.

Answer 15

Answer: Stakeholders are defined as all individuals or groups who have an active stake in the project
and can potentially impact, either positively or negatively, its development. Internal and external are
the broad categories of stakeholder groups. Internal stakeholders include top management, project
team members, and other functional managers, among others. External stakeholder groups include
clients, competitors, suppliers, and intervenor groups.

Question 16

Consider your current major and the courses that comprise it. From the perspective of Politecnico di
Milano, and more specifically, from the department that “owns” this major (school of management),
identify the stakeholders of this major. List the stakeholders in two categories, internal and external
and assess the environment and the goals of each of these stakeholders.

Answer 16

Answer: Examples will vary, but internal stakeholders might include the students pursuing this major,
the faculty in the department and any service department teaching the constituent courses, and other
university faculty or staff, e.g., advisors, placement offices, continuing education, etc. External
stakeholders could include graduates, area employers, the community, and the state legislature for
public institutions. Goals for internal stakeholders might be to grow the program, place students in
well compensated and high profile jobs, score well on nationally normed certification tests, secure
research funding and consultancies, and retain and graduate a high percentage of matriculants

Question 17

The man hours requirement is typically at a peak during the ________ phase of the project life cycle.

A) conceptualization

B) planning

C) execution

D) termination

Answer 17

C

Question 18

Individual activities and their durations are developed during the ________ phase of the project life cycle.

A) conceptualization

B) planning

C) execution

D) termination

Answer 18

B

Question 19

The general contractor handed Antoni Gaudi the keys to his dream home during the ________ phase of the project life
cycle.

A) conceptualization

B) planning

C) execution

D) termination

Answer 19

D

Question 20

Keith Monroe nails hundreds of pieces of culled lumber in the blazing July sun to form a
parquet deck for his barn roof. He and his assistant are clearly in:

A) The planning stage of the project life cycle.

B) The termination stage of the project life cycle.

C) The execution stage of the project life cycle.

D) Way over their heads.

Answer 20

c

Question 21

•
The MBA redesign committee presents the results of their five year project to their bemused
Dean. They hope it is not just wishful thinking that they are in the:

A) Conceptualization phase.

B) Planning phase.

C) Execution phase.

D) Termination phase.

Answer 21

D

Question 22

•
The MBA redesign committee presents the results of their five year project to their bemused
Dean. They hope it is not just wishful thinking that they are in the:

A) Conceptualization phase.

B) Planning phase.

C) Execution phase.

D) Termination phase.

Answer 22

D

Question 23

Client interest is typically at its lowest during the:

A) Conceptualization phase.

B) Planing phase.

C) Execution phase.

D) Termination phase

Answer 23

c

Question 24

•
The amount of corporate investment is typically at its lowest in the:

A) Conceptualization phase.

B) Planning phase.

C) Execution phase.

D) Termination phase.

Answer 24

A

Question 25

The amount of corporate investment is typically at its highest in the:

A) Conceptualization phase.

B) Planning phase.

C) Execution phase.

D) Termination phase.

Answer 25

D

Question 26

The commitment of financial, human, and technical resources is highest during the:

A) Conceptualization phase.

B) Planning phase.

C) Execution phase.

D) Termination phase

Answer 26

C

Question 27

Describe

the activities that occur at each stage of a project.

Answer 27

Answer: Stages in a project’s development are referred to as the project life cycle, which consists of conceptualization,
planning, execution, and termination. In the conceptualization stage the scope of the work is determined, necessary
resources are identified, and important organizational stakeholders signed on. In the planning stage all detailed
specifications, schematics, schedules, and other plans are developed. Individual pieces of the project are broken down,
individual assignments are made, and the process for completion is delineated. During the execution phase the system is
developed or the product is created and fabricated. Termination occurs when the completed project is transferred to the
customer, the project’s resources are reassigned, and the project is formally

Question 28

Where
in the project life cycle are the intensity level of resources and client interest at their highest? Why is this the case?

Answer 28

Answer
: The intensity level of resources peaks during the execution phase of the project life cycle. The actual work is
performed during this phase, so the commitment of financial, human, and technical resources peaks at this time. The level of
enthusiasm or concern expressed by the project’s intended customer peaks in both the conceptualization and termination
phases. The client is initially very interested because they provide input on the goal and specifications of the project. Pro jec t
work moves out of the conceptual phase to a more internal mode and the client’s interest wanes until the project nears
delivery. At this point the client’s interest peaks again as they prepare to receive the completed project and all the associ ate d
benefits.

Question 29

The University of Puhonicks hires several professors that specialize in
accounting, management, and economics and clusters each into one of three
departments. The dean has obviously decided to group employees by:

A) Function.

B) Geography.

C) Project.

D) Product.

Answer 29

d

Question 30

Companies that are structured by grouping people performing similar
activities into departments are:

A) Project organizations.

B) Functional organizations.

C) Matrix organizations.

D) Departmental organizations

Answer 30

b

Question 31

•
A major player in the software industry stumbles from one new edition of its operating system and
office automation package to another. As soon as one package is released, the programmers and
developers have two weeks to latch onto a different team that is updating a different package. Failure
to find another team to work for means an end to their employment. This organizational structure is
BEST classified as a:

A) Functional organization.

B) Matrix organization

C) Project organization.

D) Flexible organization.

Answer 31

c

Question 32

John Drone toils endlessly at Hurts Corporation on his routine assignment and also on a number of
project teams. His annual evaluation features input from his line manager and each of the project
managers, all of whom have equal say in how his 12 hour work day is partitioned. John Drone is
employed by a:

A) Functional organization.

B) Project organization.

C) Cross functional organization.

D) Matrix organization

Answer 32

d

Question 33

•
A functional organization structure is a weakness for project management because:

A) In depth knowledge and intellectual capital development are enabled.

B) No disruption or changes to a firm’s design are necessitated by projects developed
within this structure.

C) Priorities among functional departments may be different and competing.

D) Standard career paths are enabled so team members only perform their duties as
needed.

Answer 33

c

Question 34

In general, the poorest organizational structure when it comes to managing projects is
probably the:

A) Matrix structure.

B) Functional structure.

C) Project structure.

D) Process structure

Answer 34

b

Question 35

All major decisions and authority are under the control of the project manager
in a:

A) Matrix structure.

B) Functional structure.

C) Project structure.

D) Process structure

Answer 35

c

Question 36

Staffing fluctuations associated with project completion and initiation are most
likely to occur in organizations that are:

A) Functionally structured.

B) Project structured.

C) Matrix structured.

D) Process structured

Answer 36

b

Question 37

A dual hierarchy is the salient feature of a:

A) Project structure.

B) Matrix structure.

C) Functional structure.

D) Bi modal structure.

Answer 37

b

Question 38

The project manager controls most of the project activities and functions,
including the assignment and control of project resources in the:

A) Strong matrix.

B) Weak matrix.

C) Dual matrix.

D) Primal matrix.

Answer 38

a

Question 39

The manager of the Super Burrito Project is in the midst of an important project team meeting
but Fred Fromage , the representative from the Cheese department, is nowhere to be found.
After a brief investigation it is determined that Fred’s manager in the Cheese department has
other plans for Fred’s time and efforts over the next several days and he simply won’t be
available for Super Burrito Project work. The organizational structure being used here is
unquestionably a:

A) Strong matrix.

B) Weak matrix.

C) project organization.

D) Chevre organization.

Answer 39

b

Question 40

A major weakness of a matrix organizational structure for project management occurs when:

A) The environment is dynamic.

B) Resources are scarce and shared between functional responsibilities and the competing project.

C) The number of human resource coordination meetings is considered.

D) One considers the dual importance of project management and functional efficiency.

Answer 40

c

Question 41

•
A matrix organization for project management has a distinct advantage
because:

A) Dual hierarchies mean two bosses.

B) A significant amount of time is spent negotiating the sharing of critical resources.

C) Workers must reconcile competing project and functional demands.

D) Project importance is enhanced by setting authority equal to that of functional
departments.

Answer 41

d

Question 42

The belief that organizations can sometimes gain tremendous benefit from
creating a fully dedicated project organization is captured by the term:

A) Heavyweight project organization.

B) Matrix organization.

C) Benevolent society.

D) Leveraged benefits.

Answer 42

a

Question 43

What are the advantages and disadvantages of using a functional structure to manage a project?

Answer 43

Answer: A functional structure groups people and departments performing similar activities into units. Division of labor in the functional structure is
not based on the type of product or project supported, but rather according to the type of work performed. In an organization ha ving a functional
structure, members routinely work on multiple projects or support multiple product lines simultaneously. The most common weak nes s in a functional
structure is the tendency for employees organized this way to become fixated on their concerns and work assignments to the ex clu sion of the needs
of other departments (called functional siloing ). An additional weakness of the functional structure is it provides no logical location for a central
project management function and that projects operating in this environment must be layered on top of the duties of functiona l g roups. Finally, there
is a tendency to sub optimize efforts on a project that is not tightly bound to a group. A department that is not directly affec ted by a project may put
forth only the minimum effort.

Question 44

•

Describe the two forms of a matrix organization and indicate the advantages of each for project management.

Answer 44

•
Answer: A matrix organization may be further classified as being a weak matrix (sometimes called functional matrix) and a st ron g matrix
(sometimes referred to as a project matrix). A weak matrix has a great deal of functional organization character; the manager st ill controls resources
and manages project components. The strong matrix cedes much of this control over to the project manager. If the functional a nd project managers
differ in skills, then the form having the superior manager would be ideal. The strong matrix is the closest that a matrix en vir onment can come to be
a true project organization. If the competitive environment is such that a project organization form is ideal, then the stron g m atrix is superior to the
weak matrix.

Question 45

•

What is a pure project structure for an organization? What are the advantages of using this structure?

Answer 45

Answer: A project structure is set up such that the exclusive focus is on running projects. Each project is a self contained bu siness unit with a
dedicated project team. The project manager is the leader of the project and the staff all report to the leader. The staffing de cisions and duration of
the employees’ tenure with the project are left to the discretion of the project manager, who is the chief point of authority fo r the project. The four
advantages of this structure as presented in the text are: the project manager is the authority and in control of the project ; i mproved communication
among project team members; there is a ready supply of trained project management professionals; and increased flexibility an d r apid response to
environmental opportunities.

Question 46

) Which of these statements about internal rate of return analysis is

A) If the IRR is less than the company’s required rate of return, the project is worth funding.

B) Projects having lower IRR are generally superior to those having higher IRR.

C) IRR and NPV calculations always make the same investment recommendations.

D) If net outflows follow a period of net inflows, IRR may give conflicting results.

Answer 46

D

Question 47

) Which of these statements about valuation models is NOT

A) NPV employs a weighted average cost of capital discount rate that reflects potential reinvestment.

B) IRR and NPV calculations typically make the same investment recommendations only when the projects are independent of each ot her.

C) If cash flows are not normal, IRR may arrive at multiple solutions.

D) IRR is a more robust determinant of project viability than NPV.
Politecnico

Answer 47

D

Question 48

The present value of money is lower the further out in the future I expect to spend it (True or False)

Answer 48

False

Question 49

Internal rate of return is preferable to net present value because IRR employs a weighted average cost of capital discount rat e that reflects potential reinvestment (True or False?).

Answer 49

False

Question 50

What is the time value of money principle and how does it apply to
project selection?

Answer 50

: The time value of money principle suggests that money earned today is worth more than
money expected in the future. Future money is expected to be worth less for two reasons: 1) the impact
of inflation, and 2) the inability to invest the money. The time value of money principle may be applied to
project selection as one criterion to ascertain which project will generate the greatest return on a
company’s investment. Projects that have a relatively certain return of greater sums of money would be
preferred over projects that stand a chance of returning less money in today’s dollars

Question 51

What is an internal rate of return and what advantages and disadvantages are accrued by
using it to evaluate projects?

Answer 51

Answer: Internal rate of return (IRR) is a method of evaluating the expected outlays and income
associated with a new project investment opportunity. IRR is the discount rate that equates the present
values of a project’s revenue and expense streams. If IRR is greater than or equal to the company’s
required rate of return, the project is worth funding. The advantage of using IRR analysis is its ability to
compare alternative projects from the perspective of expected return on investment. IRR suffers from
difficulty in conflicting solutions if cash flows are not normal, e.g., if net outflows follow a period of net
cash inflows. IRR is not the rate of return for a project.

Question 52

Which statement about scope management is BEST?

A) Scope management must take place during the conceptual development, full
definition, execution, and termination phases

B) Project goals don’t matter in scope management as long as the budget is not
exceeded

C) Scope management is accomplished in a single step by any one project team
member

D) Scope management can begin once a project hits operational level

Answer 52

A

Question 53

Scope management for a project begins with

A) A work package

B) An organization breakdown structure

C) A statement of goals

D) A configuration statement

Answer 53

C

Question 54

The statement of work should contain

A) Information on the key objectives for the project

B) A brief and general description of the work to be performed

C) Expected project outcomes

D) All of these are elements of a statement of work

Answer 54

D

Question 55

Any measurable, tangible, verifiable outcome, result, or item that must be
produced to complete a project or part of a project is a

A) Product

B) Deliverable

C) Tangible

D) Work product

Answer 55

B

Question 56

The PMBoK definition stating,stating,”a hierarchical decomposition of the total scope
of work to be carried out by the project team to accomplish the project
objectives and create the project deliverables,” is for the

A) Project plan

B) Work breakdown structure

C) Deliverable statement

D) Scope expansion

Answer 56

B

Question 57

What are work breakdown structure elements that must be completed to
conclude the project deliverables?

A) Activities

B) Tasks

C) Work packages

D) Milestones

Answer 57

C

Question 58

The lowest level in work breakdown structure contains the

A) Atoms

B) Activities

C) Finite elements

D) Work packages

Answer 58

D

Question 59

The highest level of work breakdown structure is the

A) Project

B) Deliverable

C) Subdeliverable

D) Work package

Answer 59

A

Question 60

A project manager can identify personnel who will be directly responsible for each task in the project's development by
using a(n)

A) Responsibility assignment matrix

B) Milestone designation chart

C) Merrill report

D) Work package report

Answer 60

a

Question 61

What is a scope statement and what are the key steps in the scope statement process?

Answer 61

The scope statement reflects a project team’s best efforts at creating the documentation and
approval of all important project parameters prior to proceeding to the development phase The key
steps of the scope statement process identified in the text are

Establishing the project goal criteria

Developing the management plan for the project

Establishing a work breakdown structure

Creating a scope baseline

Question 62

List any five important points to remember when defining work packages

Answer 62

o
The work package typically forms the lowest level in the work breakdown structure
o
A work package has a deliverable result
o
A work package has one owner
o
A work package may be considered by its owner as a project in itself
o
A work package may include several milestones
o
A work package should fit organizational procedures and culture