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Project Management in Practice, Sixth Edition Test Bank

Project Management in Practice, Sixth Edition Test Bank enhances learning with well-structured notes, key formulas, and exam-style problems.

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    Chapter 1: The World of Project Management True/False 1. A primary purpose of forming projects is to assign the responsibility for accomplishing some organizational task to a specific person or small group. Answer: True Response: See section 1.1 Level: easy 2. One of the few similarities between project management and general management is that both exist in the well - defined organizational structure of superior/subordinates in the overall organization. Answer: False Response: See section 1.2 Level: medium 3. Many recent developments in project management are being driven by changes in the nature of the American workforce. Answer: False Response: See section 1.1 Level: medium 4. There has been a growing use of projects to achieve an organization’s strategic goals Answer: True Response: See section 1.1 Level: medium 5. While general managers have their authority limited to specific areas in the overall organization, project managers have authority over any activity required by the project.

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    Answer: False Response: See section 1.2 Level: medium 6. Projects are always carried out under conditions of uncertainty. Answer: True Response: See section 1.3 Level: easy 7. One can trade - off time and cost when managing a project, but the project’s technical specifications must be maintained exactly as the client initially specifies. Answer: False Response: See section 1.3 Level: medium 8. Nonnumeric project selection methods are only suitable if numeric methods are not available. Answer: False Response: See section 1.5 Level: medium 9 . When using financial methods for selecting projects, the payback period is the simplest and best method to use. Answer: False Response: See section 1.5 Level: medium 1 0 Rank - ordering a large number of projects can be done with a Q - sort. Answer: True Response: See section 1.5 Level: medium

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    1 1 . A disadvantage of using the payback period method for selecting projects is that it cannot reflect the time - value of money. Answer: True Response: See section 1.5 Level: medium 1 2 . A disadvantage of using the discounted cash flow method (or net present value) for selecting projects is that it ignores all non - monetary factors associated with the project except risk . Answer: True Response: See section 1.5 Level: medium 1 3 . A disadvantage of using scoring models rather than financial models for selecting projects is that they cannot include the project’s profitability. Answer: False Response: See section 1.5 Level: medium 1 4 . A PM doesn o t need to understand why a project is selected for funding because he didn o t initiate the process. Answer: False Response: See section 1.5 Level: medium 1 5 . The main distinction between platform and breakthrough projects is that the former usually depend on existing technology. Answer: True Response: See section 1.6

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    Level: medium 1 6 . The main distinction between platform and derivative projects is that the latter depend on existing technology. Answer: False Response: See section 1.6 Level: medium 1 7 . One reason for the emphasis on project management is that tasks fit neatly into business - as - usual. Answer: False Response: See section 1.1 Level: easy 18 . Programs are subdivisions of projects. Answer: False Response: See section 1.1 Level: easy 19 . Projects are subdivisions of programs. Answer: True Response: See section 1.1 Level: easy 20 . A similarity between project management and general management is the tendency to “manage by exception.” Answer: False Response: See section 1.2

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    Level: medium 21 . Project budgets are primarily modifications of budgets for the same activity in the previous period. Answer: False Response: See section 1.2 Level: medium 22 . In project management, superior - subordinate relationships are known and lines of authority are clear. Answer: False Response: See section 1.2 Level: medium 2 3 . Having responsibility for the outcome of a project without the authority of rank or position is common in project management. Answer: True Response: See section 1.2 Level: medium 2 4 . Negotiating the purchase of a new car would typically be characterized as win - win negotiation. Answer: False Response: See section 1.2 Level: medium 2 5 . In project management, it is often necessary to trade - off one objective for another. Answer: True Response: See section 1.3 Level: easy

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    2 6 . A project that is selected because it is necessary for continued operations exemplifies a sacred cow. Answer: False Response: See section 1.5 Level: medium 27 . The comparative benefits method is considered a nonnumeric project selection method. Answer: True Response: See section 1.5 Level: medium 28 . When using the weighted scoring model, the categories for each scale must be in equal intervals. Answer: False Response: See section 1.5 Level: medium 29 . Scoring methods were developed to overcome some of the disadvantages of simple financial profitability methods. Answer: True Response: See section 1.5 Level: medium 30 . One limitation of scoring methods is that they can only incorporate quantitative data. Answer: False Response: See section 1.5 Level: medium

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    31 . As a rule of thumb, the number of factors included in a scoring model should be at least 10. Answer: False Response: See section 1.5 Level: medium 32 . Projects success is not determined by the portfolio of projects in an organization. Answer: False Response: See section 1.6 Level: medium 33 . R&D projects are oriented toward using newly developed technologies or existing technologies in a new manner. Answer: True Response: See section 1.6 Level: medium 34 . Projects with deliverables that are incrementally different from existing offerings are classified as platform projects. Answer: False Response: See section 1.6 Level: medium 35 . The project manager depends on legitimate authority to gain the cooperation of the many departments in the organization that may be asked to supply technology, information, resources and personnel to the project. Answer : False Response: See section 1.2 Level: medium 36 . In the early years of a project when outflows usually exceed inflows, the NPV of the project for those years will be positive.

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    Answer: False Response: See section 1.5 Level: medium Multiple Choice 37 . Which of the following is not a trend in project management? a) achieving strategic goals b) improving project effectiveness c) quasi projects d) reductive projects e) achieving routine goals Answer: d Response: See section 1.1 Level: medium 38 . Which of the following criteria can be included in scoring models for selecting projects? a) potential profitability of the project b) potential impact on the firm’s competitive position c) the organization’s ability to market the output of a project d) All of the above can be included e) only a and b above Answer: d Response: See section 1.5 Level: medium 39 . If the initial investment is a project is $100,000 and the expected annual net profit for the project is $20,000, the payback period is: a) One fifth of a year b) 4 years c ) 5 years d) 10 years e) insufficient information to determine the payback period

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    Answer: c Response: See section 1.5 Level: medium 40 . Which of the following is not a characteristic of a project? a) They are unique b) They are routine c) They have specific due date d) They have a specific deliverable e) They have a purpose Answer: b Response: See section 1.1 Level: medium 4 1 . “Blue Sky” projects are a) R & D projects b) Platform projects c) Breakthrough projects d) Derivative projects e) High risk projects Answer: a Response: See section 1.6 Level: medium 4 2 . Searching for the third alternative is most closely associated with a) win - win negotiation b) project planning c) project budgeting d) the three goals of a project e) the weighted scoring model Answer: a Response: See section 1.2 Level: medium

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    43 . Which of the following is not related to the three goals of a project? a) time b) data c) schedule d) cost e) performance Answer: b Response: See section 1.3 Level: medium 44 . Projects that begin with a slow start, have quick momentum in the middle, and have a slow finish are said to follow which type of lifecycle? a) J - shaped lifecycle b) L - shaped lifecycle c) an exponential growth lifecycle d) an S - shaped lifecycle e) an X - shaped lifecycle Answer: d Response: See section 1.4 Level: medium 45 . Which of the following is a numeric project selection method? a) comparative benefits b) payback period c) Q - sort method d) operating/competitive necessity e) sacred cow Answer: b Response: See section 1.5 Level: medium 46 . A matrix that illustrates the magnitude of both product and process changes resulting from a project is called a) the aggregate project plan b) the product - process matrix c) the aggregate master production schedule

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    d) the balanced scorecard e) the R&D project portfolio Answer: a Response: See section 1.6 Level: medium 47 . The ________________________ attempts to link the organization’s projects directly to the goals and strategy of the organization. a) the product - process matrix b) the balanced scorecard c) the action plan d) project portfolio process e) the work breakdown structure Answer: d Response: See section 1.6 Level: medium 48 . Rebus Inc., a game development company, had gained critical success with its video game Authority Online a year ago. The game's publisher wanted Rebus to undertake a project to revitalize the game's salesby updating the graphics an d releasing it for a new platform. This type of project is an example of a(n) _____. a) derivative project b) R&D project c) p latform project d) b reakthrough project e) sacred cow project Answer: a Response: See section 1.6 Level: difficult 49 . Ultor is a media company that specializes in creating print advert isements for local businesses. Lately, it has been undertaking requests for multimedia projects that are new to it . In this scenario, Ultor is most likely accepting _____. a) derivative projects b) R&D projects c) platform projects d) breakthrough projects e) sacred cow projects

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    Answer: c Response: See section 1.6 Level: difficult 50 . Restrum C orp . is a company that delivers lunch to working professionals through delivery drivers. It ha s recently undertaken a project that will allow it to use drones to deliver meals to its customers. Restrum's new project can be categorized as a (n) _____. a) d erivative project b) R &D project c) blue - sky project d) b reakthrough project e) s acred cow project Answer: d Response: See section 1.6 Level: difficult 51. Alchemax Inc . is looking to undertake a project that requires an initial fixed investment of $200,000 and is expected to return a net cash inflow of $50,000 each year. The payback period for this project will be _____ years. a) 2 b) 7 c) 4 d) 9 e) 5 Answer: c Response : See section 1.5 Level: difficult 52 . Ouroboros Construction started the construction of a house for a client. The initial planning of the project took longer than expected . Once plans were finalized, it did not take long to erect the structure, and it was done much before schedule. However, it took a lot of time to give the finishing touches to the house, and it was a long time before the house was completed. The project in this scenario has a (n) _____. a) J - shaped life cycle b) X - shaped life cycle c) S - shaped life cycle d) L - shaped life cycle e) O - shaped life cycle Answer: c

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    Response : See section 1.5 Level: difficult 53. OmicoreSoftworks , a software development firm, undertook a project that involved develop ing a bespoke accounting software for a firm. The project initiated with the project manager spen d ing some time to identify the correct resources. Once this was done, the process of writing the program began. Most of the time was spent on debugging and ensuring that the software worked to the client's specification. The project in this scenario has a (n) _____. a) J - shaped life cycle b) X - shaped life cycle c) S - shaped life cycle d) L - shaped life cycle e) O - shaped life cycle Answer: a Response: See section 1.5 Level: difficult 54 Baketolife, asmall bakery that specializes in wedding cakes, undertook a project that required the creation of a large five - tier cake. While the mixture for the cake was easy to make and took less than half a day to prepare, the size of the cake meant that a lot of time was spent ensuring that each cake was cooked all the way through.The project in this scenario has a (n) _____. a) L - shaped life cycle b) X - shaped life cycle c) S - shaped life cycle d) J - shaped life cycle e) O - shaped life cycle Answer: d Response: See section 1.5 Level: difficult 55 . W hich of the following is an example of win - lose negotiation ? a) Buying a car from a s econd - hand car dealership at the asking price . b) Discussing a problem with all parties concerned and finding a middle ground c) Carrying on an argument over a petty issue that can be easily resolved d) Agreeing to share resources for the benefit of all involved in different projects e) Disagreeing with a project idea while not providing an alternative Answer: a Response : See section 1.2

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    Level: difficult 56 . W hich of the following is an example of win - win negotiation ? a) Buying a car from a second - hand car dealership at the asking price b) Forcibly using resources allocated to another department c) Keeping resources that could be used by another team busy in unnecessary tasks d) Agreeing to share resources for the benefit of all involved in different projects e) Carrying on an argument over a petty issue that can be easily resolved Answer: d Response: See section 1.2 Level: difficult 57 . W hich of the following is an example of lose - lose negotiation ? a) Buying a car from a second - hand car dealership at the asking price b) Taking time off from a project to help another team c) Disagreeing with a project idea while not providing an alternative d) Agreeing to share resources for the benefit of all involved in a project e) Discussing a problem with all parties concerned and finding a middle ground Answer: c Response: See section 1.2 Level: difficult Short Answer 58 . Briefly explain what a project is. Answer: A projectis a temporary endeavor undertaken to create a unique product or service. It is specific, timely, usually multidisciplinary, and typically conflict ridden. Projects are parts of overall programs and may be broken down into tasks, subtasks, and further if desired. Current trends in project management include achieving strategic goals, achieving routine goals, improving project effectiveness, virtual projects, and quasi - projects. Response: See section 1.1 Level: medium 59 . What are the major trends in project management? Answer: Many recent developments in project management are being driven by

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    quickly changing global markets, technology, and education. The most important of these recent developments are covered below. Achieving Strategic Goals: There has been a growing use of projects to achieve an organization’s strategic goals, and existing major projects are screened to make sure that their objectives support the organization’s strategy and mission. Projects that do not have clear ties to the strategy and mission are not approved. PMOs for Improving Project Effectiveness: A variety of efforts are being pursued to improve the process and results of project management, whether strategic or routine. These efforts are typically being led by a formal Project Management Office that provides training in project management skills and techniques such as the use of p hase gates, agile management , earned value, critical ratios, and other such approaches; continually evaluates and helps improve the organization’s project management “maturity”; educates project managers about the evolving ancillary goals of the organization; and generally helps oversee the organization’s portfolio of programs and projects. Virtual Projects: With the rapid increase in the globalization of industry, many projects now involve global teams whose members operate in different countries and different time zones, each bringing a unique set of talents to the project. These are known as virtual projects because the team members may never physically meet before the team is disbanded and another team is reconstituted. Advanced telecommunications and computer technology allow such virtual projects to be created ,and helps team members complete their work and project s successfully. Quasi - Projects: Led by the demands of the information technology/systems departments, project management is being extended into areas where the project’s objectives are not well understood, time deadlines unknown, and/or budgets undetermined. This ill - defined type of project is extremely difficult to conduct and to date has often resulted in setting an artificial due date and budget, and then specifying project objectives to meet those limits. However, new tools for these quasi - projects are now being developed — agile management, prototyping, phase - gating, and others — to help these projects achieve results that satisfy the customer in spite of the unknowns. Response: See section 1.1 Level: medium 6 0 . To what extent can the three goals of a project be traded - off for one another? Answer: The two primary roles of a project manager (PM) are to manage trade - offs among three interrelated objectives and to manage risks. The three interrelated objectives are: (1) meet the budget, (2) finish on schedule, and (3) generate deliverables that satisfy the client. Since we live in an uncertain world, as work on the project proceeds, unexpected problems are bound to arise. These

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