Pmstudy exam 3

Question No : 1
While managing a project, you decide to create a prototype of your product first to ensure that it is acceptable to
stakeholders before creating your product. This is an example of:
Choice 1 Risk mitigation
Choice 2 Risk avoidance
Choice 3 Simulation
Choice 4 Project assumptions testing
Correct Choice : 1
Justification :
Mitigation may require prototype development to reduce the risk of scaling up from a bench-scale model of a process or
product.
Reference: PMBOK®
Guide - Fifth Edition, page 345

Question No : 2
In which of the following cases is a contract NOT legally binding?
Choice 1 The seller is not able to produce goods as part of the contract.
Choice 2 The signatory to the contract leaves the company.
Choice 3 The buyer is not able to satisfy financial obligations.
Choice 4 The contract violates the law of the land.
Correct Choice : 4
Justification :
A contract is a legal relationship subject to remedy in the courts. A contract containing provisions that violate the law of the
land is not enforceable in the courts of law.
Reference: PMstudy.com comments

Question No : 3
Two project team members have resigned from your company. However, you are able to negotiate with functional
managers in your organization to quickly acquire two more resources as substitutes. From a stakeholder management
point of view, this can be referred to as:
Choice 1 Pre-assignment
Choice 2 Corrective action
Choice 3 Approved change request
Choice 4 Resolved issue
Correct Choice : 4
Justification :
Unavailability of resources is an issue, and by getting two appropriate resources quickly, you were able to resolve the issue
quickly.

Question No : 4
You are working in the vendor management department of your company and are responsible for sourcing printing
machines from manufacturers. You recently visited a marketing conference of a leading printing machine manufacturer,
where you were offered a gift-voucher of $ 200 for attending the conference. You should:
Choice 1 Accept the gift, because it is compensation for attending the conference
Choice 2 Accept the gift and also inform your manager
Choice 3 Return the gift, because it could be construed as personal gain
Choice 4 Accept the gift, because it is for a small amount and was given to everyone in the conference
Correct Choice : 3
Justification :
A project manager has the responsibility to refrain from offering or accepting inappropriate payments, gifts, or other forms
of compensation for personal gain, unless it is in agreement with applicable laws or customs.
Reference: PMI Code of Ethics and Professional Conduct

Question No : 5
In your company, the project manager shares responsibility with the functional manager to assign priorities and directs the
team members of the project. In this case, it is NOT the responsibility of the project manager to:
Choice 1 Plan resources
Choice 2 Manage cost and budget
Choice 3 Carry out performance appraisal of project team
Choice 4 Define tasks
Correct Choice : 3
Justification :
In a matrix organization, the project manager shares responsibility with the functional managers for assigning priorities and
for directing the work of persons assigned to the project.
Reference: PMBOK®
PMstudy.com comments: In most matrix organizational structures, personnel performance management is not the
responsibility of the project manager; this task is usually done by the functional manager. However, a project manager is
always responsible for Plan resources (Option 1), Manage cost and budget (Option 2), and Define tasks (Option 4).

Question No : 6
You are the project manager in an aircraft manufacturing company developing a new range of supersonic fighter planes.
Since government approval and involvement are essential, you hire a lobbying firm to get government support to prevent
unnecessary changes in your project. Which process is this an example of?
Choice 1 Perform Integrated Change Control
Choice 2 Risk Management
Choice 3 Cost Management Plan
Choice 4 Develop Project Management Plan
Correct Choice : 1
Justification :
The Perform Integrated Change Control process includes influencing the factors that circumvent integrated change control
so that only approved changes are implemented.
Option 2 (Risk Management) and option 3(Cost Management Plan) are not processes. Option 4 (Develop Project
Management Plan) is not valid because here we do not deal with factors that can cause changes.

Question No : 7
The customer accepted your project`s product two weeks ago, but recently complained that some of the product features
are not as desired and that the product is not functioning properly. What should you do FIRST?
Choice 1 Ignore the customer, since he already accepted the product.
Choice 2 Review the customer`s test results.
Choice 3 Review the Validate Scope process.
Choice 4 Start working on rectifying the errors as reported by the customer.
Correct Choice : 3
Justification :
The verified deliverables obtained from the Control Quality process are reviewed with the customer or sponsor to ensure
that they are completed satisfactorily and have received formal acceptance of the deliverables by the customer or
sponsor.
Reference: PMBOK®
Option 3: The first step to be taken is to review the Validate Scope process to determine whether the product conforms to
the stipulated requirements.
Option 1: Ignoring the customer is never recommended since he is one of the most important stakeholders in your project.
Option 2: You cannot review the customer`s test results, since the customer may not be ready to share it with you and,
therefore, you may not have access to it.
Option 4: Before rectifying the errors, you must understand clearly whether all the deliverables were delivered satisfactorily.

Question No : 8
The studio you are working for has assigned you as the project manager for a movie project where the producer left
midway due to health issues. As a project manager, you are responsible for meeting the project schedule deadlines. If
there is some delay in the project schedule, you should:
Choice 1 Increase the timeline for the project.
Choice 2 Fast track or crash the project, and let the management know the impact of this action.
Choice 3 Ask the resources to work overtime to meet the project deadlines.
Choice 4 Change the project scope.
Correct Choice : 2
Justification :
Schedule compression shortens the project schedule without changing the project scope to meet schedule constraints,
imposed dates, or other schedule objectives. Schedule compression techniques include Crashing and Fast tracking.
Reference: PMBOK®
PMstudy.com comments: If a project is getting delayed, it is appropriate to find out whether the schedule can be decreased
by fast tracking or crashing. The implications of these techniques (e.g., increase in risk / costs) should be conveyed to the
management for approval.

Question No : 9
Which project will be selected from the following options?
Choice 1 Project A: internal rate of return of 12%, opportunity cost $0
Choice 2 Project B: internal rate of return of - 2%, opportunity cost of $20,000
Choice 3 Project C: benefit cost ratio of 0.5, payback period of 6 months
Choice 4 Project D: internal rate of return of 0%, opportunity cost of $200,000
Correct Choice : 1
Justification :
The only suitable option is option 1, because the internal rate of return is positive, i.e., 12%. All other options exhibit
unfavorable selection criteria. Opportunity cost is not a selection criteria.
Internal Rate of Return (IRR)
 Discount Rate on an investment which makes Present value of cash inflows = Present value of cash outflows
 Project Selection Criterion: Select a project with higher IRR.
Example: There are two projects. Project A has an IRR of 15% and will be completed in 5 years. Project B has an IRR of
10% and will be completed in 1 year. Which project will you select?
Answer: Project A will be selected. The fact that project B has a smaller duration than project A does not matter because
time is already taken into account in IRR calculations.

Question No : 10
You want to identify quality requirements and standards relevant to your project and product. For this, you will:
Choice 1 Perform Quality Assurance
Choice 2 Plan Quality
Choice 3 Perform Quality Control
Choice 4 Plan Quality Management
Correct Choice : 4
Justification :
Plan Quality Management is the process of identifying quality requirements and/or standards for the project and its
deliverables and documenting how the project will demonstrate compliance with quality requirements.
Reference: PMBOK®

Question No : 11
Maximum intensity of conflicts occur over:
Choice 1 Priorities
Choice 2 Schedules
Choice 3 Personality
Choice 4 Cost
Correct Choice : 2
Justification :
Reference: Project Management - A Systems Approach to Planning, Scheduling and Controlling, page 302

Question No : 12
You have completed the Manage Communications process and are now in a position to make the required information
available to the project stakeholders in a timely manner. Which of the following is NOT an output from Manage
Communications process?
Choice 1 Performance reports
Choice 2 Project reports and presentations
Choice 3 Stakeholder notifications
Choice 4 Project records
Correct Choice : 1
Justification :
Performance reports are the output from the Control Communications process and not from the Manage Communications
process. All the remaining stated in the other options are included in Organizational Process Assets updates, which is the
one of the outputs from the Manage Communications process.
Reference: PMBOK®
Guide - Fifth Edition, pages 302 and 308

Question No : 13
You are the project manager for XYZ company. The Quality Control team recently identified a large number of defects in
the project deliverables which the team had to repair. You have been working for a few weeks with the Quality Assurance
team to adjust some quality procedures and address some training issues for your project which the team believes is the
reason for the defects. The project is now behind schedule due to the problems encountered. The CPI is currently 1.12 and
the SPI 0.82. While discussing the quality issues in a status meeting, a key stakeholder comments that she is alarmed at
the potential cost impact of one particular risk and is wondering why it is of little concern to the project team. You are
confident that her concern for that particular cost risk is unwarranted at the moment; in fact, you believe there is another
risk that is of bigger concern. The following table displays the current risks for your project. Considering that schedule is a
concern right now, which risk are you going to tell the stakeholder and other meeting participants is the greatest and is
therefore the biggest concern of the team right now?
Risk Probability Cost Impact Schedule Impact
A 0.4 2 8
B 0.4 6 3
C 0.3 2 3
D 0.2 4 9
Choice 1 A
Choice 2 B
Choice 3 A & B
Choice 4 D
Correct Choice : 1
Justification :
For each risk identified, multiply the probability by the cost and schedule impact. Once you have each P & I score, you can
prioritize the risks. Risk A currently is the biggest threat to your schedule and overall objectives.
Risk Probability Cost Impact Schedule Impact PI (Cost) PI (Schedule) Total
A 0.4 2 8 0.8 3.2 4
B 0.4 6 3 2.4 1.2 3.6
C 0.3 2 3 0.6 0.9 1.5

D 0.2 4 9 0.8 1.8 2.6

Question No : 14
You had conducted an independent estimate to find out the cost of sub-contracting the manufacturing of 1,000,000 ball-
bearings for your automobile company. You estimated the cost to be $500 per bearing. However, when you asked for bids
and proposals from prospective sellers, the minimum price quoted was $750 per bearing. Which of the following can be a
reason for the variance in the estimate?
A. The procurement statement of work was not clear.
B. The prospective sellers misunderstood the procurement statement of work.
C. The procurement statement of work was not sufficient.
D. There have not been major changes in the cost of material and labor since last year.
Choice 1 B, C and D
Choice 2 Only B and C
Choice 3 All of the Above
Choice 4 A, B and C
Correct Choice : 4
Justification :
Significant differences in cost estimates can be an indication that the procurement statement of work was deficient,
ambiguous, and/or that the prospective sellers either misunderstood or failed to respond fully to the procurement statement
of work.
Reference: PMBOK®
PMstudy.com comments: (Option 4)Since there have not been major changes in the cost of material and labor since last
year, the independent estimates should be close to the amount quoted by prospective sellers.

Question No : 15
During the Identify Stakeholders process, which document may provide some initial idea of who the stakeholders are for a
project?
Choice 1 Communications management plan
Choice 2 Project charter
Choice 3 Human resource contracts
Choice 4 Responsibility assignment matrix
Correct Choice : 2
Justification :
The project charter is an input to the Identify Stakeholder process which provides some initial information about the
project’s stakeholders, such as the sponsor, customer(s), team members, and groups/organizations involved in, or affected
by the project.

Question No : 16
While reviewing the performance reports of your project, you notice that the Cost Performance Index (CPI) is 1.2 and
Schedule Performance Index (SPI) is 0.8. In this case you should:
Choice 1 Make changes to the performance baseline to improve the SPI
Choice 2 Evaluate options to crash or fast-track the project
Choice 3 Inform the management why the project got delayed
Choice 4 Tell the team-members that they have no option but to meet the target dates as stated in the project schedule
Correct Choice : 2
Justification :
Since SPI is 0.8, the project is behind schedule. But since CPI is 1.2, you are under budget.
Option 2: This (Fast tracking or crashing) is the only alternative that helps solve the problem. They may increase costs but
decrease the project timelines.
Option 1: This is unethical and does not solve the issue.
Option 3: This does not solve the problem. Accepting the change in schedule timelines and informing management about
the project delay should be the last option to choose, as there is no other way to bring the project back on track.
Option 4: This is going to put the team members under a lot of stress, because the cause of the problem is not properly
investigated and identified.

Question No : 17
Which of the following aspects of a project is NOT the responsibility of a project manager?
Choice 1 Keep the project on track in terms of schedule and budget
Choice 2 Identify, monitor, and respond to risk
Choice 3 Provide accurate and timely report of project metrics
Choice 4 Ensure integrity of project team members
Correct Choice : 4
Justification :
A project manager is in charge of all aspects of the project including, but not limited to developing the project management
plan and all related component plans, keeping the project on track in terms of schedule and budget, identifying, monitoring,
and responding to risk, and providing accurate and timely reporting of project metrics.
Although the project manager is responsible for the integrity of the overall project, she is not responsible for the integrity of
individual team members.

Question No : 18
A technological advance, legal requirement, or social need refers to:
Choice 1 Issues that need to be managed in the project plan
Choice 2 Environmental factors that usually have detrimental effect on the project
Choice 3 Risks that have to be managed by the project manager
Choice 4 Factors contributing to the creation of the business case
Correct Choice : 4
Justification :
The business case is created as a result of one or more of the following:
→Market demand
→Organizational need
→Customer request
→Technological advance
→Legal requirement
→Ecological impacts
→Social need
Reference: PMBOK®

Question No : 19
Your project involves manufacturing high-precision engine subassemblies for the shipping industry. You have to perform
several activities such as measuring, examining, and verifying to determine whether work and deliverables meet
requirements and product acceptance criteria. You would have to do product reviews, audits, and walkthroughs. These
activities are carried out in which process?
Choice 1 Validate Scope
Choice 2 Quality Inspection
Choice 3 Collect Requirements
Choice 4 Control Scope
Correct Choice : 1
Justification :
Validate Scope includes inspection as a technique. Inspection includes activities such as measuring, examining, and
validating to determine whether work and deliverables meet requirements and product acceptance criteria. Inspections are
sometimes called reviews, product reviews, audits, and walkthroughs.
Reference: PMBOK®

Question No : 20
You are a project manager overseeing a canal development project. The table given below shows the time estimates for
the different tasks involved. Please refer to it and answer the question that follows.
What is the impact on the project if task 1→ 2 takes 2 months more than what was earlier planned?
Choice 1 The project duration will increase by 1 month
Choice 2 The project risk will increase
Choice 3 The project duration will increase by 2 months
Choice 4 The project float will increase by 2 months
Correct Choice : 2
Justification :
Please refer to the diagram below:

The lengths of different paths are:
Start→ 1→ 2→ End: 10 months
Since the longest path is Start→ 4→ 5→ End, this is the critical path. Length of the critical path is 12 months.
If task 1→ 2 takes 2 more months,
length of Start→ 1→ 2→ End : 12
Now we have 2 critical paths, i.e.,
Hence, the risk in the project increases, because delay in either of the critical paths will cause a delay in the project.

Question No : 21
You are creating a cost performance baseline for your project. In this context, which of the following statements related to
cost performance baseline is incorrect?
Choice 1 It is a time-phased budget.
Choice 2 It is used as a basis for comparison to actual results.
Choice 3 It is developed as a summation of the approved budgets for the different schedule activities.
Choice 4 It includes management reserves.
Correct Choice : 4
Justification :
The cost baseline is the approved version of the time-phased project budget, excluding any management reserves, which
can only be changed through formal change control procedures and is used as a basis for comparison to actual results. It
is developed as a summation of the approved budgets for the different schedule activities.
Reference: PMBOK®

Question No : 22
After quality planning, you have created a component-specific tool to verify that the required steps have been performed to
test your product. This can also be referred to as:
Choice 1 Checklist
Choice 2 Operational definition
Choice 3 Quality management plan
Choice 4 Design of experiments (DOE)
Correct Choice : 1
Justification :
A checklist is a structured tool, usually component-specific, used to verify that a set of required steps has been performed.
Reference: PMBOK®

Question No : 23
In your project, you recently observed conflict among team members. You would like to see that all team members work
towards one goal (i.e., successful completion of the project). A conflict handling method that emphasizes similarities rather
than differences as means to solve a problem can also be referred to as:
Choice 1 Smoothing
Choice 2 Forcing
Choice 3 Confrontation
Choice 4 Withdrawal
Correct Choice : 1
Justification :
Blake and Mouton have delineated five modes for handling conflicts as listed below:
 Withdrawal: Retreating or withdrawal from a potential disagreement.
 Smoothing: De-emphasizing or avoiding areas of differences and emphasizing areas of agreement.
 Compromising: Bargaining and searching for solutions that bring some degree of satisfaction to the parties in a
dispute. Characterized by a ‘’give and take’’ attitude.
 Forcing: Exerting one’s viewpoint at the potential expense of another. Often characterized by competitiveness and
a win-lose situation.

 Confrontation: Facing the conflict directly, which involves a problem solving approach, whereby affected parties
work through their disagreements.
Reference: Project Management - A Systems Approach to Planning, Scheduling and Controlling, pages 304, 305 and 306

Question No : 24
You are not happy with the performance of a team member. In this context:
a) What type of communication will you use to relay your concerns to the concerned team member?
b) If the performance of the team member does not improve even after voicing your concern, what form of communication
will you use to convey the information to the senior management?
Choice 1 a) informal oral, b) informal written
Choice 2 a) informal oral, b) formal written
Choice 3 a) formal written, b) formal written
Choice 4 a) informal written, b) formal written
Correct Choice : 2
Justification :
Various Forms of Communication and Their Characteristics
Form of
Communication
Characteristics Examples
Written Formal • Precise
• Transmitted through the
medium of correspondence
• Project charter, scope statement, project
plan, WBS, project status
• Complex issues
• Contract related communications
• Memos
Written Informal • Email, notes, letters, etc.
• Regular communication with team members

Oral Formal • High degree of flexibility
• Use the medium of personal
contact, group meetings, or
telephone
• Presentations, speeches,
• Negotiations
Oral Informal • Conversation with team members
• Project meetings
• Break-room or war-room conversations
Non-verbal
Communication
• About 55% of total
communication
• Facial expressions, hand movements, tone
of voice while speaking, etc.
Reference: Project Management - A Systems Approach To Planning, Scheduling and Controlling, Ninth Edition, page 273.
Please note that initial communication about performance should preferably be informal oral (e.g. face-to-face meeting). If
the performance does not improve, while escalating to senior management, formal-written communication should be used.
Reference: PMstudy.com study notes

Question No : 25
You are the project manager in an automobile manufacturing company. Machine parts required in your manufacturing
process supplied by a vendor did not reach in time because of heavy rains. You had anticipated this risk and planned for it
in your risk response plan. So, as per your risk response plan, you started using unutilized machine parts supplied one
year ago. However, this has subjected your project to a new risk - the machine parts which were not used for one year
suffer from higher level of defects.
This new risk can also be called:
Choice 1 Unidentifiable risks
Choice 2 Unmanageable risks
Choice 3 Secondary risks
Choice 4 Residual risks
Correct Choice : 3
Justification :
Secondary risk. A risk that arises as a direct result of implementing a risk response.
Reference: PMBOK®

Question No : 26
You have contracted some work to a vendor, and would like to identify successes and failures that warrant recognition in
the preparation or administration of other procurement contracts within the performing organization. This can be performed
through:
Choice 1 Procurement audit
Choice 2 Contract file
Choice 3 Contract performance reporting
Choice 4 Lessons learned documentation
Correct Choice : 1
Justification :
A procurement audit is a structured review of the procurement process originating from the Plan Procurement Management
process through Control Procurements. The objective of a procurement audit is to identify successes and failures that
warrant recognition in the preparation or administration of other procurement contracts on the project, or on other projects
within the performing organization.
Reference: PMBOK®

Question No : 27
Which of the following would NOT be considered a useful Organizational Process Asset when identifying stakeholders?
Choice 1 Lessons learned from previous phases
Choice 2 Stakeholder register templates
Choice 3 Stakeholder registers from previous projects
Choice 4 Organizational culture for identifying stakeholders
Correct Choice : 4
Justification :
Stakeholder register templates, lessons learned from previous projects or phases, and stakeholder registers from previous
projects are all examples of Organizational Process Assets useful during the Identify Stakeholders process. Organizational
culture is an Enterprise Environmental Factor to be considered, not an Organizational Process Asset.
Reference: PMBOK® Guide Fifth Edition, page 395

Question No : 28
One of your team members filed a critical report ten minutes before a bidder conference. You notice some serious errors
have crept into the report. You should:
Choice 1 Cancel the meeting and reschedule it at a later date
Choice 2 Go ahead with the meeting and tell the participants what is wrong with the report
Choice 3 Go ahead with the meeting, but ask your team member to make the presentation
Choice 4 Refer the team member`s report to management and ask them to cancel the meeting
Correct Choice : 1
Justification :
Option 1 is the best choice. Option 2 and 3 can adversely impact the team morale and undermine your position in the
bidder conference. Option 4 is not recommended, as you should try to solve the problem yourself.

Question No : 29
You have been managing a project to construct an overpass on Interstate 10. You have divided the project into phases to
provide better management control. Which of the following is a characteristic of a project phase?
Choice 1 Formal phase completion necessarily includes authorization for the subsequent phase.
Choice 2 The closure of a phase is required to be approved in some form before it can be considered closed.
Choice 3 A project phase should not be divided into sub-phases even in complex projects, because it will be difficult to
manage.
Choice 4 All deliverables in the project phase should correspond to the project management process.
Correct Choice : 2
Justification :
In many cases, the closure of a phase is required to be approved in some form before it can be considered closed.
Reference: PMBOK®

Question No : 30
The organization of the project is very important for successful implementation. Which factor does NOT have any impact
on the design of the project organization?
Choice 1 Environmental forces
Choice 2 Schedule limitations
Choice 3 Strategic choices
Choice 4 Technological factors
Correct Choice : 2
Justification :
Schedule limitations can shape the size of the project team but will not influence its organizational design.
Reference: Project Management - A Systems Approach to Planning, Scheduling and Controlling.
Also mentioned in "Organizing Projects for success"
PMstudy.com comments: Option 1 (Environmental forces), option 3 (Strategic choices) and option 4 (Technological
factors) influence the organizational design.

Question No : 31
An environmental remediation project has succeeded in reducing costs. This is achieved by implementing a change
request for new technology that was not available when the scope was originally defined. The technology change that is
adopted is a/an:
Choice 1 Value adding change
Choice 2 Error or omission in defining the scope of the project
Choice 3 External event
Choice 4 Contingency or workaround plan
Correct Choice : 1
Justification :
Value addition, usually, is a result of implementation of change requests. A contingency plan would have had to be created
at the start and since this technology was not available then, it cannot be the answer. Since the technology wasn`t
previously available, it cannot be considered as an error in the plan.

Question No : 32
In your project team, you have developed a rule of thumb that scarce resources will have to be allocated first to the critical
path. This rule of thumb can also be referred to as:
Choice 1 Constraints
Choice 2 Assumptions
Choice 3 Best Practices
Choice 4 Heuristics
Correct Choice : 4
Justification :
Heuristics (or rule of thumb), such as allocation of scarce resources to the critical path first, can be applied to develop a
schedule.

Question No : 33
Your company primarily uses Benefit Cost Ratio (BCR) as a project selection criterion. In this context, which of the
following statements related to Benefit Cost Ratio (BCR) is incorrect?
Choice 1 Projects with BCR > 1 should be considered for selection
Choice 2 BCR is the ratio of payback to costs
Choice 3 If two projects have positive BCR, select the project with higher BCR
Choice 4 For any project, Benefits = Profits
Correct Choice : 4
Justification :
Benefits are not profits, Benefits = Revenues/Costs
 Benefit Cost Ratio (BCR) = Benefits (or Payback or Revenue)/ Costs
 Project Selection Criterion: Select project with higher BCR
 BCR > 1 means that benefits (i.e. expected revenue) is greater than the cost. Hence, it is beneficial to do the
project.
Example: There are two projects. Project A has an investment of $500,000 and a BCR of 2.5. Project B has an investment
of $300,000 and a BCR of 1.5. Using Benefit Cost Ratio criterion, which project will you select?
Answer: Project A will be selected. The fact that project B has a smaller investment than project A will not impact the
selection.

Question No : 34
In your project, you have used valuable inputs to produce project activity metrics to evaluate actual progress as compared
to planned progress. The inputs used during the Control Quality process are:
A. Risk register
B. Organizational process assets
C. Quality management plan
D. Work performance data
Choice 1 B, C and D
Choice 2 A, C and D
Choice 3 A, B and D
Choice 4 A, B and C
Correct Choice : 1
Justification :
The risk register is not an input to the Control Quality process.
Reference: PMBOK®
Guide - Fifth Edition, page 249 (figure 8-11)
PMstudy.com comments: Please note that the Project Management Plan (which is an input to this process) includes the
Quality management plan.

Question No : 35
What are Tuckman`s stages of group development in their respective order?
Choice 1 Forming, Norming, Storming, Performing, Adjourning
Choice 2 Forming, Storming, Smoothing, Performing, Adjourning
Choice 3 Forming, Storming, Norming, Performing, Adjourning
Choice 4 Forming, Norming, Storming, Performing, Closing
Correct Choice : 3
Justification :
Tuckman described five stages of team development. Teams usually go through the stages in order, but it is possible for
teams to skip a stage or get stuck in, or revert to a previous stage.
1. Forming – Team meets, learns their roles and responsibilities and agree on goals; individuality is at its highest
during this phase
2. Storming – Team starts working on the project; competition may result from different individual ideas; “I am right”
mentality
3. Norming – Team members adjust their behavior to work as a team; learn to trust each other; “We can work
together” mentality
4. Performing – Teams are able to function as an organized and interdependent unit as they find ways to get the job
done smoothly and effectively

5. Adjourning – Completing the task and moving on from the project as staff are released during project or phase
closure
Reference: Tuckman, Bruce (1965). Developmental sequence in small groups. Psychological Bulletin 63 (6): 384–99.

Question No : 36
During critical negotiations on outstanding issues arising out of a contract, you should pay close attention to which form of
communication?
Choice 1 Oral formal
Choice 2 Oral informal
Choice 3 Non-verbal
Choice 4 Written formal
Correct Choice : 3
Justification :
Non-verbal communication forms more than 55% of the total communication and is important to pay attention to while
negotiations are being conducted.
Various Forms of Communication and Their Characteristics
Form of
Communication
• Complex issues
• Memos
• Negotiations

Oral Informal contact, group meetings, or
telephone
• Conversation with team members
Non-verbal
Communication
communication
Reference: Project Management - A Systems Approach To Planning, Scheduling and Controlling, Ninth Edition, page 273.

Question No : 37
Based on past estimates, there is a 25% probability for a particular event to occur every year. If a project lasts for three
years, what is the probability of the event happening in the third year?
Choice 1 15.625 %
Choice 2 6.25 %
Choice 3 25%
Choice 4 75%
Correct Choice : 3
Justification :
The probability of the event happening every year is 25%. So, the probability of the event happening in the third year is
also 25%.

Question No : 38
In your project, you wish to manage procurement relationships, monitor contract performance, and make changes and
corrections as needed. Which of the following would you not use?
Choice 1 Agreements
Choice 2 Work performance data
Choice 3 Approved change requests
Choice 4 Project schedule
Correct Choice : 4
Justification :
Project schedule is an input to the Plan Procurement Management process; all the other options are inputs to Control
Procurements process.
Reference: PMBOK®
Guide - Fifth Edition, pages 358 and 379 (figures 12-2 and 12-6, respectively)

Question No : 39
Which of the following is used to classify critical stakeholders on a project as a “manage closely” approach?
Choice 1 Identify Stakeholders
Choice 2 Plan Stakeholder Management
Choice 3 Stakeholder Analysis
Choice 4 Plan Communications Management
Correct Choice : 3
Justification :
During the Identify Stakeholders process, stakeholder analysis is a technique used to gather and analyze information to
determine the project stakeholders. This technique includes the classification of stakeholders. The Power/Interest Grid is
one model which can be used for this purpose.
Stakeholders who have a high level of authority (power) and high level of concern (interest) regarding the project
outcomes, fall into the “Manage Closely” quadrant of the Power/Interest Grid (please refer PMBOK®
Guide Fifth Edition,
page 397, figure 13-4).

Question No : 40
In an informal discussion you had with another PMP certificant, he mentioned how he was able to sit for the PMP
Certification exam three years ago using false contact hour certificates. You should:
Choice 1 Report this to PMI
Choice 2 Report this to your manager
Choice 3 Do nothing, since he is a colleague
Choice 4 Do nothing, since he had taken the PMP exam three years ago, and contact hour certificates get audited only for
one year
Correct Choice : 1
Justification :
A project manager`s responsibility is to report, upon a reasonable and clear factual basis, possible violations of PMI Code
of Ethics and Professional Conduct committed by individuals in the project management field.
Reference: PMI Code of Ethics and Professional Conduct and PMstudy.com study notes

Question No : 41
The CEO of ABC bank is concerned about the increase in "call answering time" in the bank`s call center (i.e., customers
have to wait longer for their calls to be answered by an operator). She wants to improve call center processes to decrease
the "call answering time." What should the CEO do to address the situation?
Choice 1 Set up a PMO
Choice 2 Assign a very competent project manager to manage activities in the call center
Choice 3 Move to a projectized organizational structure
Choice 4 Continue with a functional organizational structure, and try to streamline activities
Correct Choice : 4
Justification :
This is an operation and not a project (projects are temporary and unique, but call center activities are ongoing and
repetitive).
In this context, the CEO should not try to handle this issue as a project and do none of the activities mentioned in option 1,
option 2, or option 3.
Since this is an operation, option 4 provides the best course of action for the CEO to address this situation, i.e., continue
with a functional organizational structure (which is recommended for managing operations) and try to streamline activities.

Question No : 42
As the project manager of an IT project, you are directing and managing the project work. You have been looking at
information related to similar projects. Which tools will you use?
Choice 1 Interpersonal skills, product skills and knowledge, and work authorization system (WAS)
Choice 2 Status review meetings and organization procedures
Choice 3 Project management information system and expert judgment
Choice 4 Risk management and project selection techniques
Correct Choice : 3
Justification :
Please refer the PMBOK®
Reference: PMBOK®

Question No : 43
Your company is constructing a dam, and your project (being performed under an agreement) mandates that you pay
compensation to persons displaced because of the project. What kind of constraint is this?
Choice 1 Social
Choice 2 Legal
Choice 3 Environmental
Choice 4 Humanitarian
Correct Choice : 2
Justification :
When a project is performed under an agreement, contractual provisions will generally be constraints.

Question No : 44
You are in the process of performing Develop Schedule process to determine planned start and finish dates for project
activities. Which of the following inputs will be helpful in this process?
Choice 1 Activity attributes, project scope statement, and activity list
Choice 2 Activity list, activity attributes, and schedule data
Choice 3 Project calendar, requested changes, and schedule data
Choice 4 Work performance information, schedule baseline, and performance reports
Correct Choice : 1
Justification :
In Develop Schedule process, planned start and finish dates for project activities are determined by using activity
attributes, project scope statement, and activity list as part of inputs.
Reference: PMBOK®
PMstudy.com comments: Schedule data and schedule baseline are outputs of Develop Schedule process; and work
performance information is an output of Control Schedule process.

Question No : 45
Your business partner is ready to invest $ 110,000 in your company one year from now. The interest rate used in your
company to calculate Present Value (PV) of expected yearly benefits and costs is 10%. What is the PV of this investment?
Choice 1 $112,000
Choice 2 $100,000
Choice 3 $80,000
Choice 4 $110,000
Correct Choice : 2
Justification :
PV = 110,000 / (1 + 10/100) = 100,000

Question No : 46
You are preparing a quality management plan for your project. Which of the following will you use in this process?
A. Cost-benefit analysis
B. Quality checklists
C. Cost of quality
D. Benchmarking
Choice 1 B, C and D
Choice 2 A, C and D
Choice 3 A, B and D
Choice 4 A, B and C
Correct Choice : 2
Justification :
Quality management plan and quality checklists are outputs of Plan Quality Management process. Quality checklists are
used in the Control Quality process, and the remaining three are used as tools and techniques for Plan Quality
Management process.
Reference: PMBOK®
Guide - Fifth Edition, pages 230 (figure 8-1) and 242

Question No : 47
You are annoyed with your team members because of their constant disagreements. You ask them to stop arguing and do
the work the way in which you want it to be done. The conflict handling approach you are following is:
Choice 1 Smoothing
Choice 2 Forcing
Choice 3 Confrontation
Choice 4 Withdrawal
Correct Choice : 2
Justification :
Blake and Mouton have delineated five modes for handling conflicts as listed below:
 Withdrawal: Retreating or withdrawal from a potential disagreement.
 Smoothing: De-emphasizing or avoiding areas of differences and emphasizing areas of agreement.
 Compromising: Bargaining and searching for solutions that bring some degree of satisfaction to the parties in a
dispute. Characterized by a ‘’give and take’’ attitude.
 Forcing: Exerting one’s viewpoint at the potential expense of another. Often characterized by competitiveness and
a win-lose situation.
 Confrontation: Facing the conflict directly, which involves a problem solving approach, whereby affected parties

work through their disagreements.
Reference: Project Management - A Systems Approach to Planning, Scheduling and Controlling, pages 304, 305 and 306

Question No : 48
In your project, you are using the Control Communications process to organize and summarize the information gathered.
Later, you present the results of the analysis as a comparison to the performance measurement baseline. Some common
formats for performance reports that you could use are:
Choice 1 S-curves, histograms, pareto diagrams
Choice 2 S-curves, responsibility assignment matrices, histograms
Choice 3 Bar charts, S-curves, histograms
Choice 4 Bar charts, control charts, histograms
Correct Choice : 3
Justification :
Common formats for performance reports include bar charts, S-curves, histograms, and tables.
Option 1: Pareto diagrams are used in the Control Quality process.
Option 2: Responsibility assignment matrices are used in the Plan Human Resource Management process.
Option 4: Control charts are used in the Control Quality process.

Question No : 49
As a project manager, you estimate that, in your project, there is:
50% probability of earning $40,000 profit
50% probability of incurring $25,000 loss
What is the expected value for the project considering profit and loss possibilities?
Choice 1 $32,500
Choice 2 $25,000
Choice 3 $7,500
Choice 4 - $7,500
Correct Choice : 3
Justification :
Expected Profit = Sum of (Probability X Profit) (for each alternative)
= (0.50 x $40,000) + (0.50 x - $25,000)
= $20,000 - $12,500
= $7,500

Question No : 50
In your new project, you have to provide a critical deliverable within five months and do not have time to go through the
Conduct Procurements process. You decide to sign a contract with a supplier with whom your company has done some
work in the past. The risk you are accepting in this situation is:
Choice 1 The ability of the supplier to deliver the goods
Choice 2 Collusion between the supplier and your team
Choice 3 Lack of proper scope definition
Choice 4 Lack of a legally binding agreement
Correct Choice : 1
Justification :
The risk here is that even though the supplier has worked with the company in the past, they may not have the required
skills for the current project.

Question No : 51
It is important for the project manager to effectively engage stakeholders throughout the project life cycle in order to ensure
support of the project’s objectives. Analytical techniques are used to:
Choice 1 Compare current to planned stakeholder engagement levels
Choice 2 Keep stakeholders satisfied
Choice 3 Engage stakeholders
Choice 4 Analyze the effectiveness of the Stakeholder Management Plan
Correct Choice : 1
Justification :
The current engagement levels of all stakeholders needs to be compared to the planned engagement levels required for
successful project completion....The project team needs to identify the desired engagement level for the current phase of
the project, based on available information.
Reference: PMBOK®

Question No : 52
When the contract is halfway through, the buyer requests you to incorporate some additional requirements which were not
defined in the original contract. Since satisfying the buyer is important, you go ahead and incorporate those requirements
as part of the project. According to PMI, this action is a violation of which aspect of Code of Ethics and Professional
Conduct?
Choice 1 Responsibility to maintain and satisfy the scope and objectives
Choice 2 Responsibility to ensure that a conflict of interest does not compromise legitimate interests
Choice 3 Responsibility to provide accurate and truthful representations
Choice 4 Responsibility to cooperate with PMI concerning ethics violation and the collection of related information
Correct Choice : 1
Justification :
Option 1 is violated because adding the requirement violates the contractual terms, which will impact project deliverables.
Options 2, 3, and 4 are not relevant in this context.

Question No : 53
You are planning for your project. In this context, which of the following processes should you consider?
Choice 1 Define Scope, Develop Schedule, Plan Risk Management, Plan Communications Management
Choice 2 Plan Quality Management, Plan Procurement Management, Plan Risk Responses, Control Costs
Choice 3 Perform Quality Assurance, Develop Project Team, Manage Communications, Plan Risk Management
Choice 4 Validate Scope, Control Quality, Control Schedule, Control Costs
Correct Choice : 1
Justification :
Please refer to table 3-1 and figure A1-7, PMBOK®
Guide - Fifth Edition, pages 61 and 428 respectively.
Reference: PMBOK®

Question No : 54
In the process of directing and managing the project work, your project team may request changes to expand or modify
project scope, policies, procedures, project cost, or budget. Which of the following is NOT a request for a change?
Choice 1 Direct or indirect
Choice 2 Externally or internally initiated
Choice 3 Optional or legally mandated
Choice 4 Formal or informal
Correct Choice : 4
Justification :
Requests for change can be direct or indirect, externally or internally initiated, and can be optional or legally/contractually
mandated.
Reference: PMBOK®
PMstudy.com comments: Request for change is always a formal process.

Question No : 55
You are reaching project completion, and want to understand whether your project was successful. In this context, for a
project to be successful, what is the primary requirement?
Choice 1 Customer satisfaction
Choice 2 Exceeding customer expectations
Choice 3 Meeting the cost and schedule estimates
Choice 4 Satisfying the requirements of the project sponsor
Correct Choice : 1
Justification :
Project: Success is measured by product and project quality, timeliness, budget compliance, and degree of customer
satisfaction.
PMstudy.com comments: Customer satisfaction is the primary criterion for measuring the project success. Although
meeting customer expectations is necessary, exceeding customer expectations, cost, and schedule estimates are not
primary requirements for a successful project - at times, this may even be gold plating. Please note that while in a few
cases the customer and sponsor may be the same person, they are by definition two different groups.

Question No : 56
In your project, you are in the process of creating an activity list. This should contain which of the following:
A. Activities not to be performed as part of the project
B. Activities that are to be performed as part of the project
C. Activity identifier and scope of work description for each schedule activity in sufficient detail
D. Activities that are required for the project
Choice 1 B, C and D
Choice 2 C, D and A
Choice 3 D, A and B
Choice 4 A, B and C
Correct Choice : 1
Justification :
The activity list is a comprehensive list that includes all schedule activities required on the project. The activity list also includes the
activity identifier and a scope of work description for each activity in sufficient detail to ensure that project team members
understand what work is required to be completed.
Reference: PMBOK®
PMstudy.com comments: Activity list will not include activities that are not to be performed as part of the project.

Question No : 57
In your project, there have been several changes in the cost and schedule estimates, and the original estimating assumptions are no
longer valid. Calculate the estimate at completion (EAC) for your project based on the following data?
BAC = $300,000
AC = $100,000
EV = $150,000
CPI = 1.2
ETC = $120,000
Choice 1 $250,000
Choice 2 $220,000
Choice 3 $280,000
Choice 4 $300,000
Correct Choice : 2
Justification :
Since original estimating assumptions are no longer valid, EAC = AC + ETC = $100,000 + $120,000 = $220,000
Acronym Term Description Formula
EAC
Estimate at
Completion
Forecast of most likely total project cost
based on project performance
1. Original estimating assumptions
no longer valid
2. Current Variances are atypical;
similar variances will not occur in
the future
1. AC+ ETC
2. AC + BAC – EV
3. AC + (BAC –
EV)/CPI

3. Current Variances are typical of
future variances
BAC
Budget at
Completion
Budget for the whole project EAC x CPI
ETC
Estimate to
complete
From this point, how much time is
required to complete the project
EAC – AC
VAC
Variance at
completion
Over or under budget BAC – EAC

Question No : 58
As a project manager, you are aware that quality has costs associated with it. Which of the following statements is NOT
related to cost of quality?
Choice 1 Cost of appraising the product or service for conformance to requirements
Choice 2 Cost of rework
Choice 3 Costs incurred by investment in preventing non-conformance to requirements
Choice 4 Cost of evaluating alternative projects
Correct Choice : 4
Justification :
Cost of quality includes all costs incurred over the life of the product by investment in preventing nonconformance to
requirements, appraising the product or service for conformance to requirements, and failing to meet requirements
(rework).
Reference: PMBOK®
PMstudy.com comments: Cost of evaluating alternative projects is not included as part of cost of quality.

Question No : 59
As part of your staffing management plan, you are creating a chart to illustrate the number of hours that a person,
department, or entire project team will need each week or month over the course of the project. This chart is also known
as:
Choice 1 Resource control chart
Choice 2 Resource breakdown structure
Choice 3 Resource histogram
Choice 4 Resource run chart
Correct Choice : 3
Justification :
The staffing management plan, is a component of the human resource management plan that describes when and how
project team members will be acquired and how long they will be needed. The staffing management plan can be formal or
informal, highly detailed or broadly framed, depending upon the needs of the project. One tool for charting human
resources is a resource histogram.
Reference: PMBOK®

Question No : 60
In the closure stage of your project, you are interacting with your team to create lessons learned documentation, which will
include recommendations to improve performance of future projects. Which of the following will you NOT include in the
lessons learned documentation?
Choice 1 Cause of variances
Choice 2 Justification for corrective action chosen
Choice 3 Only positive aspects of the project which can be used by others in the company
Choice 4 Reasons for cost variances if the project is over-budget
Correct Choice : 3
Justification :
Lessons learned documentation: Documentation includes the causes of issues, reasoning behind the corrective action
chosen, and other types of lessons learned about communications management. Lessons learned need to documented
and distributed so that it becomes part of the historical database for both the project and the performing organization
Reference: PMBOK®
PMstudy.com comments: Lessons learned documentation includes both positive and negative aspects of the project. It is
important to document negative aspects to avoid them in future projects.

Question No : 61
In your project, you have been sub-contracting your IT development work to four consultancy firms. Which of the following
statements about transferring risk to a contractor is not true?
Choice 1 Risk transference nearly always involves payment of a risk premium.
Choice 2 Fixed price contract always transfers the risk to the seller.
Choice 3 Cost-plus contracts may transfer the cost risks to the buyer.
Choice 4 Contracts may be used for the transference of liability for specified risks to another party.
Correct Choice : 2
Justification :
A fixed-price contract may transfer risk to the seller.
Reference: PMBOK®
PMstudy.com comments: A fixed-price contract transfers risk to the seller if requirements are well defined and seller has
the capacity to handle the risk.

Question No : 62
You are half way through a 12-month contract on a high-priority project for your company. The team has been progressing
well during execution of the project work. Some of the deliverables have already been approved by the buyer and they
seem to be happy with the progress so far. Cumulative CPI and SPI are 1.09 and .98, respectively. Your sponsor comes by
your office and you are shocked to hear from her that the buyer has decided to terminate the contract per the terminations
clause and move the work to another seller. The buyer asks you to work for the new seller. Your next step is to:
Choice 1 Accept the new position and bring the project documents with you
Choice 2 Execute contract closing procedures
Choice 3 Transfer the effort to the new seller
Choice 4 Close the contract and contact the new seller to see if the buyer has already spoken to them about you coming on
board
Correct Choice : 2
Justification :
The buyer has a right to terminate the contract if a termination clause is specified in the contract. Requirements for
procurement closure are defined in the terms and conditions of the contract.
Options 1 & 4: These options would be considered unethical and may violate confidentiality agreements you have with your
current employer.
Option 3: You should provide all deliverables and documents to the buyer, not the new seller.
Reference:PMstudy.com comments

Question No : 63
It is important to gather and analyze all relevant information to determine all project stakeholders and what their respective
interests, expectations, and influences are. It is also useful to identify stakeholder relationships that might enhance the
project’s success. This information is documented in the:
Choice 1 Stakeholder Directory
Choice 2 Stakeholder Analysis Matrix
Choice 3 Stakeholder Register
Choice 4 Stakeholder Management Plan
Correct Choice : 3
Justification :
The Stakeholder Register is a project document which includes all the details related to the identified project stakeholders,
such as identification, assessment, and classification information.
Option 1: The Stakeholder Directory may be used as another name for the Stakeholder Register, but
the PMBOK®
Guidedoes refer to this document as the Stakeholder Register.
Option 2: Stakeholder Analysis is used to gather and analyze information to determine the project’s stakeholders and then
classify them in order to identify an approach strategy. A variety of models can be used to analyze and classify
stakeholders, including the Power/Interest Grid, Power/Influence Grid, Influence/Impact Grid, and Salience Model. Results
from the analysis are documented in the Stakeholder Register, not the Stakeholder Analysis Matrix.
Option 4: The Stakeholder Management Plan is a subsidiary plan that defines the processes, procedures, tools, and
techniques to effectively engage stakeholders throughout the project.

Question No : 64
You are managing a project in a foreign country, where you realize you will have to pay a fee to some government
agencies to get your work done. You should:
Choice 1 Pay the fee to the government agencies
Choice 2 Refuse to pay the fee, because they are bribes and hence unethical
Choice 3 Make a case why fees should be paid to government agencies, and present it to your management
Choice 4 Offer gifts to the government officials instead of fee to get their support
Correct Choice : 1
Justification :
A project manager has the responsibility to refrain from offering or accepting inappropriate payments, gifts, or other forms
of compensation for personal gain, unless it is in conformity with applicable laws or customs of the country where the
project management services are provided. In this scenario, since the law of the country requires payment of fee to the
government agencies, you will not be committing any breach of the Code if you pay the same.
Please note that fees are ethical but tips, bribes and kick-backs are unethical.

Question No : 65
Which of the following is NOT a characteristic of a project life cycle?
Choice 1 Stakeholder influence, risk, and uncertainty are highest at the start of the project.
Choice 2 Ability of the stakeholders to influence final characteristics of the project`s product increases as the project
progresses.
Choice 3 The project life cycle determines which transitional actions at the beginning and end of the project are included, so
that the project can be linked to the ongoing operations of the performing organization.
Choice 4 Stakeholder influence, risk, and uncertainty decrease as the project progresses.
Correct Choice : 2
Justification :
Stakeholders` ability to influence the final characteristics of the project`s product, without significantly impacting cost, is
highest at the start of the project and decreases as the project progresses towards completion.

Question No : 66
Project integration management includes the processes and activities needed to identify, define, combine, unify, and
coordinate the various processes and project management activities. For successful project integration management, you
definitely need (select the best answer):
Choice 1 A strong matrix organizational structure in your company
Choice 2 A good communication management plan
Choice 3 Good project selection techniques
Choice 4 Positive stakeholders who support the project
Correct Choice : 2
Justification :
Option 2 is the best choice. A good communication management plan ensures good communication between the different
project interfaces and team members. This is essential for project integration management.
Option 1: Strong matrix organizational structure is not essential for good project integration management. Other
organization structures, including projectized, balanced matrix, etc., can also provide successful project integration
management.
Option 3: Project selection techniques are used for project selection in initial stages of the project. However, they are not
essential for project integration management.
Option 4: Projects may have positive and negative stakeholders, but the type of stakeholders will not affect successful
project integration management.

Question No : 67
When you encounter constraints as a project manager, in which document will you record the information about these
constraints?
Choice 1 Project scope statement
Choice 2 Risk register
Choice 3 Issue log
Choice 4 Change management plan
Correct Choice : 1
Justification :
Information on constraints may be listed in the project scope statement or in a separate log.
Reference: PMBOK®

Question No : 68
The activity list should include descriptions of activities. This is required to:
Choice 1 Provide a common understanding of the project scope among the project stakeholders
Choice 2 Ensure that the team members understand what work is to be completed
Choice 3 Serve as a reminder to the project manager
Choice 4 Help in creation of technical documentation during the project life cycle
Correct Choice : 2
Justification :
The activity list includes the activity identifier and a scope of work description for each schedule activity in sufficient detail
to ensure that project team members understand what work is required to be completed.
Reference: PMBOK®
PMstudy.com comments: The project scope statement provides a common understanding of the project scope among the
project stakeholders. (PMBOK®
Guide - Fifth Edition, page 123)

Question No : 69
In your project, you have monitored the status of the project to update the project costs and manage changes to the cost
baseline. Which of the following is an output of the Control Costs process?
Choice 1 Basis of estimates
Choice 2 Cost forecasts
Choice 3 Cost change control system
Choice 4 Work performance data
Correct Choice : 2
Justification :
Control Costs is the process of monitoring the status of the project to update the project costs and managing changes to
the cost baseline. `Cost forecasts` is one of the outputs obtained from this process.
Reference: PMBOK®

Question No : 70
The customer was not satisfied with the finished product`s quality. The cost of poor quality can also be referred to as:
Choice 1 Cost of conformance
Choice 2 Failure cost
Choice 3 Rework cost
Choice 4 Opportunity cost
Correct Choice : 2
Justification :
Failure costs are often categorized into internal (found by the project) and external (found by the customer). Failure costs
are also called cost of poor quality.
Reference: PMBOK®

Question No : 71
In your project, you would like to document team member roles and responsibilities. You have documented project roles as
responsible, accountable, consult and inform. A good way to depict the information is through:
Choice 1 RBS (resource breakdown structure)
Choice 2 RAM (responsibility assignment matrix)
Choice 3 Text-oriented format
Choice 4 WBS (work breakdown structure)
Correct Choice : 2
Justification :
A responsibility assignment matrix (RAM) is used to illustrate the connections between work packages or activities and
project team members. One example of a RAM is a RACI (responsible, accountable, consult, and inform) chart.
Reference: PMBOK®

Question No : 72
You are interviewing candidates for the position of project manager in the company. What is the most important
characteristic you would like to see in a project manager?
Choice 1 Technical knowledge of the business
Choice 2 Negotiation and convincing skill
Choice 3 Communication skill
Choice 4 Industry experience
Correct Choice : 3
Justification :
Communication skills are the most important trait in a project manager.
Importance of Communications Management
• Project managers spend more than 90% of their time communicating with team members and other project stakeholders
— internal (at all organizational levels) or external to the organization.
• The project manager should effectively and efficiently communicate with stakeholders.
• Managing communications is very vital for any project.
• Although the project manager should pay a lot of attention to managing communications, he cannot control all the
communications, because there are just too many channels. The formula used to calculate the total number of
communications channels is n*{(n-1)/2}, where n refers to the number of stakeholders.
• The project manager uses a variety of communication methods to share information among stakeholders. He or she
should decide what, how, and when to use each communication method.
• A failure in communication can have a negative impact on the project.

PMstudy.com comments: Communication is the most important skill required for a project manager, and the success of a
project very much depends on this skill. Project managers spend more than 90% of their time communicating with team
members and other project stakeholders — internal (at all organizational levels) or external to the organization.

Question No : 73
Your project is now in the executing stage. You are continuously monitoring and controlling risks to minimize negative risks
and to take timely action. Risk audits are helpful in this context because they:
Choice 1 Examine and document the effectiveness of risk responses.
Choice 2 Help in reassessment of risks.
Choice 3 Provide trends in the execution of the project, which can be reviewed using performance data.
Choice 4 Provide inputs required for the project planning stage.
Correct Choice : 1
Justification :
Risk audits examine and document the effectiveness of risk responses in dealing with identified risks and their root causes,
as well as the effectiveness of the risk management process.
Reference: PMBOK®

Question No : 74
You are considering whether to buy or lease a machine for your heavy engineering plant. Your finance department has
provided you the following data:
The cost of buying the machine (`If you buy`) is $29,000 and the one-time cost of procurement and integration is $1000.
The cost of leasing the machine (`If you lease`) involves $10,000 as down payment and $5,000 per month as license fee.
What is the breakeven duration after which the buying of the machine is preferable to leasing it?
Choice 1 3 months
Choice 2 4 months
Choice 3 5 months
Choice 4 Cannot be determined from the available data
Correct Choice : 2
Justification :
If you buy, the cost is $29,000 + $1,000 = $30,000 Assuming that the lease is for M months, the cost is $10,000 + ($5,000
x M)
The breakeven point is reached when the cost of buying becomes equal to the cost of leasing, i.e., $ 30,000 = $10,000 +
($5,000 x M)
M = 20,000/5,000 = 4 months

Question No : 75
You are the project manager working on a project to develop a new 4-color erasable pen. The customer, PMstudy.com, is
very excited to offer this innovative pen to participants in their PMP prep boot camp class, as it will allow them to erase
mistakes made when creating their detailed process chart. PMstudy also wants to use the pen to help promote their other
brands like MyITstudy.com and SCRUMstudy.com, so they have asked for their affiliate logos to appear on the pen.
They also want the product development to be rushed as they are running low on current inventory and want their next
order to consist of the new pen. Since the product is a new concept and the customer is an important one, you decide to
create a prototype of the pen during the design phase.
After reviewing the prototype, PMstudy’s CEO advises that he is not happy with the design and the size of the logos. The
Quality and Marketing Directors and other PMstudy stakeholders are happy with the prototype and feel that all their
requirements were met. What could be the most likely cause of this situation?
Choice 1 The CEO changed his requirements after seeing the prototype.
Choice 2 The team rushed through collecting the requirements and developing the prototype, since the timeline was tight,
so they missed some key requirements.
Choice 3 The CEO was not identified as a key project stakeholder.
Choice 4 All of the requirements approved for the prototype were not implemented.
Correct Choice : 3
Justification :
It is important that all relevant stakeholders are identified during the Identify Stakeholders process. If key stakeholders,
such as the company’s CEO in this case are missed, it is likely that change requests will need to be processed later in the
project to accommodate requirements that were not captured during the Collect Requirements process. In this case, it was
a good idea for the project manager to create a prototype of the product to mitigate the risk that the customer might not be
happy with the end product. This allowed the CEO the opportunity to see and comment on the product and have his
requirements addressed before the project and product delivery was complete.

Question No : 76
As a PMI Certified project manager, you are expected to comply with all organizational rules and policies. In this context,
you are expected to:
Choice 1 Provide accurate and truthful representations concerning all information directly or indirectly related to all aspects
of the PMI Certification Program
Choice 2 Report to PMI all possible violations of the PMI Code of Ethics and Professional Conduct by individuals in their
work area
Choice 3 Escalate to PMI all possible ethics violations
Choice 4 Disclose to PMI any significant circumstance that could be construed as a conflict of interest or an appearance of
impropriety
Correct Choice : 1
Justification :
Responsibility towards PMI
· Provide accurate and truthful representation concerning all information, directly or indirectly related to all aspects of the
PMI Certification Program, including but not limited to the following:
o Examination applications
o Test item banks
o Examinations
o Answer sheets
o Candidate information

o PMI Continuing Certification Requirements Program reporting forms
· Maintain and respect the confidentiality of the contents of the PMI credential exams.
· Uphold policies, rules, regulations and laws that govern our work, professional and volunteer activities.
· Report possible violations, only if we can substantiate them by facts, of the PMI Code of Ethics and Professional Conduct
by individuals in the field of project management.
· Bring ethics violations to the attention of the appropriate body of resolution, along with the details of related information.
· Apply the organization’s (employer, Project Management Institute, or other group) rules without favoritisim or prejudice.
PMstudy.com comments: Please note that all other options are extreme measures concerning reporting of all possible
violations or situations to PMI leading to conflict of interest. Usually, instead of reporting to PMI, these should be taken up
within the performing organization.

Question No : 77
You are working as a portfolio manager. Which of the following are you responsible for managing?
Choice 1 Project interdependencies
Choice 2 Projects and programs
Choice 3 Projects, programs, and operations
Choice 4 Functional work and operations
Correct Choice : 3
Justification :
A portfolio refers to projects, programs, sub-portfolios, and operations managed as a group to achieve strategic objectives.
Reference: PMBOK®
Guide - Fifth Edition, pages 8 (table 1-1) and 9
PMstudy.com comments: Portfolio management includes projects, programs, subportfolios, and related work (i.e.
functional or operational work); so, this is the best answer.

Question No : 78
Over the project duration, which document (or collection of documents) must a project manager update?
Choice 2 Change control document
Choice 3 Project scope statement
Choice 4 Project management plan
Correct Choice : 4
Justification :
The project management plan is developed through a series of integrated processes extending through project closure...
through the Perform Integrated Change Control process.
Reference: PMBOK®
PMstudy.com comments: Please note that other documents (e.g. Project scope statement) are not living documents and
can only be updated through Perform Integrated Change Control process.

Question No : 79
As a project manager, you are responsible for managing changes to the project scope. If, at the end of the project, a
customer wants a major change in the scope of work, you should:
Choice 1 Reject the change
Choice 2 Make the required change
Choice 3 Escalate the matter to senior management
Choice 4 Let the customer know about the impact of the change
Correct Choice : 4
Justification :
If there is a major change to the project, the project manager should try to influence the change to minimize the impact on
the project. Usually the project manager is advised to do the following:
1. Evaluate the impact of the change within the team.
2. Help the customer (or person requesting the change) understand the impact of the change.
3. If changes are in fact required, then open a change control and get the request approved. Obviously, you will have to
inform the management and the change control board about the impact of the changes.
4. If the change control board approves changes, then make appropriate changes in the project plan.

Question No : 80
You are in the test phase of your software project, and the project sponsor has requested a definitive estimate of when
your project will be completed. The most likely estimated duration is 30 days. Which of the following duration estimations
will you give to your sponsor?
Choice 1 29 - 31 days
Correct Choice : 1
Justification :
The different types of estimates are:
Definitive: - 5% to +10% accuracy
Budgetary: -10% to +25% accuracy
Order of magnitude: - 25% to +75% accuracy
So, if -5% to +10% variation is allowable, only 29 - 31 days fits that criterion.

Question No : 81
As a project manager, you have selected Project A that has an initial budget of $1,000 out of which $800 has already been
spent. To complete this project, you need an additional $500. Project B will require $1,200 only for completion. Which
project would you prefer to manage and what will be its ETC?
Choice 1 Project A, ETC of $800
Choice 2 Project A, ETC of $1,000
Choice 3 Project A, ETC of $500
Choice 4 Project B, ETC of $1,200
Correct Choice : 3
Justification :
Since $800 is the sunk cost, we ignore it for calculating ETC of Project A, which means that ETC (Estimate to Complete)
for Project A will be $500, whereas ETC for Project B is higher at $1,200. So, it is beneficial to select Project A.

Question No : 82
You are monitoring and recording results of assessing performance and recommending necessary changes. What do you
get from this exercise?
Choice 1 Quality control measurements
Choice 2 Quality management plan
Choice 3 Quality metrics
Choice 4 Quality checklists
Correct Choice : 1
Justification :
You are in the Control Quality process. Quality management plan, Quality metrics and Quality checklists are outputs from
Plan Quality Management process.
Reference: PMBOK®
Guide - Fifth Edition, pages 232 (figure 8-3) and 249 (figure 8-11)

Question No : 83
You are a project manager in a pharmaceutical company and manage a team of 50 resources in a virtual project team
across multiple time zones. There were concerns that team members would not be able to work well in this virtual team
structure. However, you are mid-way into the project and team members have successfully figured out efficient ways to
work together effectively. The team is in which stage of group development?
Choice 1 Performing
Choice 2 Forming
Choice 3 Smoothing
Choice 4 Norming
Correct Choice : 1
Justification :
Tuckman described five stages of team development. Teams usually go through the stages in order, but it is possible for
teams to skip a stage or get stuck in, or revert to a previous stage.
1. Forming – Team meets, learns their roles and responsibilities and agree on goals; individuality is at its highest
during this phase
2. Storming – Team starts working on the project; competition may result from different individual ideas; “I am right”
mentality
3. Norming – Team members adjust their behavior to work as a team; learn to trust each other; “We can work
together” mentality
4. Performing – Teams are able to function as an organized and interdependent unit as they find ways to get the job
done smoothly and effectively
5. Adjourning – Completing the task and moving on from the project as staff are released during project or phase
closure
Reference: Tuckman, Bruce (1965). Developmental sequence in small groups. Psychological Bulletin 63 (6): 384–99.

Question No : 84
You are the project manager in a pharmaceutical company. You are constantly involved in managing stakeholders`
expectations to satisfy their needs and resolve issues. In this context, which of the following is NOT a relevant output?
Choice 1 Organization process assets updates
Choice 2 Change requests
Choice 3 Project management plan updates
Choice 4 Communications requirements analysis
Correct Choice : 4
Justification :
Communication requirements analysis is a tool for the Plan Communications Management process.
Reference: PMBOK®
Guide - Fifth Edition, page 289 (figure 10–2)

Question No : 85
You had budgeted $200,000 in your project as contingency reserve. Now, when you are 75% through in project execution,
you notice that the funds in your contingency reserves are down to $20,000. To compare the amount of contingency
reserves remaining in your project to the amount of risk remaining, you should conduct a:
Choice 1 Variance analysis
Choice 2 Trend analysis
Choice 3 Risk assessment
Choice 4 Reserve analysis
Correct Choice : 4
Justification :
Reserve analysis compares the amount of the contingency reserves remaining to the amount of risk remaining at any time
in the project in order to determine if the remaining reserve is adequate.
Reference: PMBOK®

Question No : 86
In a fixed price contract, the buyer decides to increase the scope of work to make the product better. In this case, which of
the following can the buyer NOT do?
Choice 1 Issue a contract change request
Choice 2 Start another fixed price contract to do the additional work
Choice 3 Start another cost reimbursable contract to do the additional work
Choice 4 Cancel the existing contract and start a new contract
Correct Choice : 4
Justification :
Cancellation of the contract has to be done by both the seller and the buyer (i.e., the buyer cannot unilaterally cancel the
contract).

Question No : 87
Given the current and desired engagement levels of stakeholders in the following Stakeholder Engagement Assessment Matrix, which
would be the most important gap to be addressed by the project manager as soon as possible?
Stakeholder Unaware Resistant Neutral Supportive Leading
Sponsor C D
CEO C D
Team Member C/D
C = Current Engagement Level; D = Desired Engagement Level
Choice 1 CEO
Choice 2 Team member
Choice 3 CEO and Sponsor
Choice 4 Sponsor
Correct Choice : 4
Justification :
The sponsor is a critical stakeholder on a project since he/she provides resources and support for a project, and is
accountable for enabling and promoting the project’s success. If the sponsor is currently “resistant”, it would be important
to find out and address the reasons why, and then try to get him/her to at least be “supportive”, if not “leading” to ensure
the project’s success.
Options 1 and 3: The CEO is currently “neutral” so is neither supportive nor resistant. He/she does not play a leading role
in the project like the sponsor so this would not be an immediate concern as the current gap between current and desired
for the sponsor.
Option 2: The team member is exactly where he/she should be as current and desired levels are the same.

Question No : 88
One of your team members was late for a critical bidder conference which caused a lot of confusion. In this context,
Choice 1 You should talk with the team member to understand why he was late and discuss how to prevent similar
situations in future
Choice 2 You should raise this issue with your manager and ask for ways to avoid similar problems in future
Choice 3 You should raise this issue with the team member`s manager and ensure that he makes himself available for
future meetings
Choice 4 You should raise a risk memo highlighting the problems caused because of his non-availability
Correct Choice : 1
Justification :
Option 1 solves the problem in a realistic manner. The team member may have been late to the meeting due to legitimate
reasons. So, you should definitely talk to him and understand his situation. Moreover, you should have a contingency plan
whereby if a team member is not available, critical meetings are not exposed to risk.

Question No : 89
Your company CEO wants to set up a Project Management Office (PMO) in the company. You have been assigned the
responsibility to define the scope of work for the PMO. In this context, which of the following is NOT the function of a PMO?
Choice 1 Help manage shared resources
Choice 2 Bring order and organize communications across projects
Choice 3 Provide support functions like training and mentoring
Choice 4 Define specific strategic objectives
Correct Choice : 4
Justification :
The primary function of a PMO is to support project managers in a variety of ways, which may include, but are not limited
to: managing shared resources across all projects administered by the PMO....coordinating communication across
projects.
Portfolio Management refers to the centralized management of one or more portfolios to achieve strategic objectives.
Reference: PMBOK®
PMstudy.com comments: Option 4 refers to an activity that would be a part of Portfolio Management.

Question No : 90
In the agreement document of the project, the time schedules and deliverables in each phase are clearly stipulated. From a
project management perspective, this is:
Choice 1 Risk
Choice 2 Assumption
Choice 3 Constraint
Choice 4 Issue
Correct Choice : 3
Justification :
When a project is performed under an agreement, contractual provisions will generally be constraints.
Reference: PMBOK®

Question No : 91
After completing the Define Scope process, the management has asked you to coordinate the activities related to work
breakdown structures (WBS) in your project. When using decomposition as a tool, what should you do FIRST?
Choice 1 Identify the deliverables and related work.
Choice 2 Determine the constituent components of the WBS.
Choice 3 Assign responsibility for each task in the WBS.
Choice 4 Create the cost and time estimates for each activity in the project.
Correct Choice : 1
Justification :
Create WBS process follows the Define Scope process. In Create WBS, decomposition of the total project work into work
packages generally involves... identifying and analyzing the deliverables and related work.
Reference: PMBOK®

Question No : 92
In any project there are deliverables that need to be produced. These deliverables are produced during the executing
phase as the team carries out their assigned activities. During the planning phase, you wish to identify and document the
specific actions to be performed to produce the deliverables. This is done as part of:
Choice 1 Define Activities
Choice 2 Decomposition
Choice 3 Define Scope
Choice 4 Sequence Activities
Correct Choice : 1
Justification :
Define Activities is the process of identifying and documenting the specific actions to be performed to produce the project
deliverables.
Reference: PMBOK®

Question No : 93
While doing monitoring and controlling for your project, you notice that the cost variance is negative, but schedule variance
is positive. This indicates:
Choice 1 Cost and schedule are not dependent on each other
Choice 2 Project is under budget and behind schedule
Choice 3 Project is over budget and ahead of schedule
Choice 4 Crashing may be recommended to make the cost variance positive
Correct Choice : 3
Justification :
Positive schedule variance means the project is ahead of schedule; negative cost variance means the project is over-
budget.
Also, please note that crashing will increase costs and have an adverse impact on the cost variance.

Question No : 94
Just-in-time (JIT) manufacturing techniques are used by Japanese auto-companies to improve overall quality and decrease
operational costs. In this context, which of the following statements related to JIT are correct?
A. It emphasizes waste reduction.
B. It eliminates costs related to material handling, storage, paperwork, and inspection.
C. It emphasizes short term relationships with suppliers.
D. It reduces inventory to minimal level.
Choice 1 B, C and D
Choice 2 A, C and D
Choice 3 A, B and D
Choice 4 A, B and C
Correct Choice : 3
Justification :
Just-in-time manufacturing is a process that continuously stresses waste reduction by optimizing the processes and
procedures necessary to maintain a manufacturing operation. Part of this process is JIT purchasing or inventory where the
materials needed appear just in time for use, thus eliminating costs associated with material handling, storage, paperwork,
and even inspection.

Question No : 95
You are the project sponsor for a reputed company, and you work with the project management team in certain matters
concerned with the project. Which of the following is an area where you would NOT assist?
Choice 1 Project funding
Choice 2 Creating activity list
Choice 3 Clarifying scope
Choice 4 Monitoring progress
Correct Choice : 2
Justification :
The project sponsor works with the project management team, typically assisting with matters such as project funding,
clarifying scope, monitoring progress, and influencing stakeholders in both the requesting and performing organization for
the project benefit.
Reference: PMBOK®
PMstudy.com comments: Project sponsor is not involved in detailed tasks like creating activity list which should be done by
project team.

Question No : 96
In your project, you have conducted a communication requirements analysis to determine the total number of possible
communication channels in the project. While conducting the analysis, you learn that the number of communication
channels:
Choice 1 Increases in direct proportion to the number of people
Choice 2 Decreases in inverse proportion to the number of people
Choice 3 Increases in exponential proportion when the number of people increases
Choice 4 Depends on the type of project
Correct Choice : 3
Justification :
The number of communication channels increases exponentially as the number of people increases.
Importance of Communications Management
• Project managers spend more than 90% of their time communicating with team members and other project stakeholders
— internal (at all organizational levels) or external to the organization.
• The project manager should effectively and efficiently communicate with stakeholders.
• Managing communications is very vital for any project.
• Although the project manager should pay a lot of attention to managing communications, he cannot control all the
communications, because there are just too many channels. The formula used to calculate the total number of
communications channels is N (N-1)/2, where N refers to the number of stakeholders.
• The project manager uses a variety of communication methods to share information among stakeholders. He or she
should decide what, how, and when to use each communication method.
• A failure in communication can have a negative impact on the project.

Question No : 97
Since you know the importance of risk management, you always include it as an agenda item in your weekly status
meetings and spend ten minutes discussing the risks. Some of your project team members complain that since none of the
risks are actually happening, discussing risk management issues in status meetings is a waste of time. What should you
do?
Choice 1 Talk to your team members about the importance of risk management and why the project team needs to be
aware of all risks at all points of time.
Choice 2 Agree with your team members and mention to them that henceforth, no more time would be spent on discussing
risks in the project status meetings unless required in the future.
Choice 3 Call a meeting with your project sponsor and project management team to discuss potential training requirements
for your project team members so that they can appreciate the benefits of risk management.
Choice 4 Escalate to your management that some of your team members do not agree with your risk management
practices.
Correct Choice : 2
Justification :
Project Risk Management should be an agenda item at periodic status meetings. The amount of time required for that item
will vary, depending upon the risks that have been identified, their priority, and difficulty of response.
Reference: PMBOK®
PMstudy.com comments: There is no need to spend a fixed amount of time in all the status meetings to discuss risk
management issues.
Option 1: This states that the team should be aware of `all` risks at `all` times. This may not be possible because some
risks are not identified or may be prioritized lower (hence, place them in a watchlist).
Option 3: This assumes that the team does not know about importance of risk management which is not accurate.
Option 4: This talks about escalating a project issue to senior management, which is not advisable in this context.

Question No : 98
You are a project manager and you wish to distribute important Source selection criteria that have accumulated since the
beginning of the project to all the vendors. In this context, which of the following are possible criteria?
A. Understanding of need
B. Proprietary rights
C. References
D. Technical capability
Choice 1 B, C an D
Choice 2 All of the Above
Choice 3 A, B and D
Choice 4 None of the Above
Correct Choice : 2
Justification :
Reference: PMBOK®

Question No : 99
Managing stakeholders allows the project manager to increase support and decrease resistance from stakeholders with
the ultimate goal of project success. Which of the following are outputs of the Manage Stakeholder Engagement process?
Choice 1 Issue log, Change requests, Work performance information
Choice 2 Change requests, Stakeholder assessment matrix, Project documents updates
Choice 3 Issue log, Change requests, Project documents updates
Choice 4 Change requests, Organizational process assets updates, Team performance issues
Correct Choice : 3
Justification :
Outputs of the Manage Stakeholder Engagement process are: Issue log, Change requests, Project management plan
updates, Project documents updates, and Organizational process assets updates.
Reference: PMBOK® Guide Fifth Edition, page 392 (figure 13-1)

Question No : 100
Which of the following is not the responsibility of a PMP certificant?
Choice 1 Maintaining the confidentiality of sensitive information that you have access to
Choice 2 Managing situations wherein conflicts of interest arise
Choice 3 Ensuring the integrity of your team members
Choice 4 Refraining from offering and accepting inappropriate payments and gifts
Correct Choice : 3
Justification :
Although the project manager is responsible for ensuring the integrity of the project, she cannot be responsible for the
integrity of her team members. However, she should definitely try to influence her team members to perform all project
activities in an ethical manner and with integrity.
All the remaining options are part of the PMI Code of Ethics and Professional Conduct

Question No : 101
You are one of the ten full-time project managers in your organization. All of you share two administrative resources.
Normally, around 30 - 40 projects are executed per year involving about 30% of the employees of the organization.
However, all of them do not report to you, although you are their project manager. Your organization can best be classified
as:
Choice 1 Projectized
Choice 2 Balanced Matrix
Choice 3 Strong Matrix
Choice 4 Weak Matrix
Correct Choice : 2
Justification :
Refer to PMBOK®
Guide - Fifth Edition, page 22 (table 2-1) and page 24 (figure 2-3).
Reference: PMBOK®
Guide - Fifth Edition, pages 22 (table 2-1) and 24 (figure 2-3)
PMstudy.com comments: While the balanced matrix organization recognizes the need for a project manager, it does not
provide her with the full authority over the project, human resources, and funds.
Option 1 (Projectized Organization) is incorrect because resources in a projectized organization are not shared with the
functional manager. Option 3 (Strong Matrix) is incorrect because only 30% of the employees work on projects and the
remaining work in functional activities. Option 4 (Weak Matrix) is incorrect because full-time project managers do not exist
in Weak Matrix, which have project coordinators and/or expeditors.

Question No : 102
The aggregation of the processes, tools, techniques, methodologies, resources, and procedures to manage a project is
referred to as:
Choice 1 Project management system
Choice 2 Change control system
Choice 3 Organizational process assets
Choice 4 Project management information system
Correct Choice : 1
Justification :
Project Management System: The aggregation of the processes, tools, techniques, methodologies, resources, and
procedures to manage a project.
Reference: PMBOK®

Question No : 103
In your project, while decomposing the project work into more manageable components, you are aware of the problem of
excessive decomposition. Which of the following is NOT the consequence of excessive decomposition?
Choice 1 Non-productive management effort
Choice 2 Inefficient use of resources
Choice 3 Decreased efficiency in work performance
Choice 4 Better knowledge of activity sequences
Correct Choice : 4
Justification :
Excessive decomposition can lead to non-productive management effort, inefficient use of resources, decreased efficiency
in performing the work, and difficulty aggregating data over different levels of the WBS.
Reference: PMBOK®
PMstudy.com comments: WBS decomposition does not provide any knowledge of activity sequencing.

Question No : 104
Critical path method is an important tool for Develop Schedule. In this context, which of the following statements related to
critical path method is NOT correct?
Choice 1 Total float can affect the calculated early start and finish dates
Choice 2 The flexibility of schedule is facilitated by activity total float
Choice 3 Networks can have only one critical path
Choice 4 Networks may have multiple near critical paths
Correct Choice : 3
Justification :
Schedule networks may have multiple near-critical paths.
Reference: PMBOK®
PMstudy.com comments: Networks can have multiple critical and near critical paths.

Question No : 105
There are three projects:
Project A has a payback period of 3 years and NPV of $300,000
Project B has a payback period of 2 years and NPV of $200,000
Project C has a payback period of 1 year and NPV of $100,000
Which project should be selected if NPV criterion is used?
Choice 1 Project A
Choice 2 Project B
Choice 3 Project C
Choice 4 Project A, B, or C can be selected, because all of them have equal value
Correct Choice : 1
Justification :
Project A has highest NPV of $300,000, hence it is selected. Please note that the time value of money is already taken into
account in the NPV calculation.
Net Present Value (NPV) = (Present value of all cash inflows) - (Present value of all cash outflows)
Project Selection Criterion: Select the project with the maximum Net Present Value. The time value of money is already
taken into account while calculating NPV.
Example: There are two projects. Project A has a NPV of $1,000 and will be completed in 5 years. Project B has a NPV of
$800 and will be completed in 1 year. Which project will you select?
Answer: Project A will be selected. The fact that project B has a smaller duration than project A does not matter because
time is already taken into account in NPV calculations.
Present Value (PV) is the Future Value (FV) of a payment discounted at a discount rate (r) for the delay in payment.

Question No : 106
After performing quality control using checklists, the completed checklists should become part of the:
Choice 1 Organizational process assets
Choice 2 Project document updates
Choice 3 Project management plan updates
Choice 4 Lessons learned documentation
Correct Choice : 1
Justification :
When checklists are used, the completed checklists become part of the organizational process assets.
Reference: PMBOK®

Question No : 107
Which of the following organization charts has a hierarchical format?
Choice 1 RACI chart
Choice 2 Organizational breakdown structure
Choice 3 Work breakdown structure
Choice 4 Text-oriented formats
Correct Choice : 2
Justification :
The organizational breakdown structure (OBS) is arranged according to an organization`s existing departments, units, or
teams with the project activities or work packages listed under each department.
Reference: PMBOK®
PMstudy.com comments: RACI chart is a matrix-based chart and work breakdown structure is not a type of organization
chart.

Question No : 108
If a discrepancy related to the scope of the project has crept into a contract, what type of communication should you use to
inform the relevant stakeholders?
Choice 1 Informal oral
Choice 2 Formal oral
Choice 3 Informal written
Choice 4 Formal written
Correct Choice : 4
Justification :
For contracts (which are legal documents), the preferred mode of communication is always "formal written”.
Various Forms of Communication and their Characteristics
Form of
Communication
• Complex issues
• Memos
• Negotiations

telephone
Non-verbal
Communication
communication
Reference:
 Project Management - A Systems Approach To Planning, Scheduling and Controlling, Ninth Edition, page 273
 PMstudy.com study notes

Question No : 109
You are in the Identify Risks process of your project where you determine which risks may affect the project and document
their characteristics. Who would you want to be a part of the Identify Risks process?
Choice 1 The project manager, project team members, subject matter experts, and customers
Choice 2 The risk management team, end users, and risk management experts
Choice 3 All relevant stakeholders
Choice 4 Positively impacted stakeholders
Correct Choice : 3
Justification :
Participants in risk identification activities may include the following: project manager, project team members, risk
management team (if assigned), customers, subject matter experts from outside the project team, end users, other project
managers, stakeholders, and risk management experts. While these personnel are often key participants for risk
identification, all project personnel should be encouraged to identify potential risks.
Reference: PMBOK®

Question No : 110
In your project, you would like to create a document that describes the procurement item in sufficient detail so that sellers
can determine if they can provide the item. This document is referred to as:
Choice 1 Procurement audit
Choice 2 Contract file
Choice 3 Procurement documents
Choice 4 Procurement statements of work
Correct Choice : 4
Justification :
The procurement statements of work describes the procurement item in sufficient detail to allow prospective sellers to
determine if they are capable of providing the products, services, or results
Reference: PMBOK®

Question No : 111
Which project document is used for documenting and monitoring elements under discussion or in dispute between project
stakeholders?
Choice 1 Dispute log
Choice 2 Issue log
Choice 3 Change log
Choice 4 Problem log
Correct Choice : 2
Justification :
Issue log: A project document used to document and monitor elements under discussion or in dispute between project
stakeholders.
Reference: PMBOK®

Question No : 112
As a project manager, achieving customer satisfaction is an important objective for you. Which of the following will help you
in attaining your objective?
Choice 1 Defining requirements
Choice 2 Providing more features than what the customer has asked for
Choice 3 Identifying project related risks
Choice 4 Providing project justification
Correct Choice : 1
Justification :
Option 1 is the best answer. Defining requirements will help the customer be clear on the functionalities she is going to find
in the final product. For the project team, defining requirements is very critical, because it will help in scope definition and
scope verification.
Option 2: Providing more features than what the customer has asked for is "gold plating" which is not approved by PMI.
Option 3: Identifying project related risks definitely has to be done by the project team and some high probability and high
impact risks should be communicated to the customers. But defining requirements results in a higher degree of customer
satisfaction than identification of risks.
Option 4: Providing project justification is a part of the project charter and is more relevant for the business to evaluate
future trade-offs.

Question No : 113
You are responsible for the development and launch of a NASA satellite. Your role is that of a:
Choice 1 Project Manager
Choice 2 Project Coordinator
Choice 3 Program Manager
Choice 4 Functional Manager
Correct Choice : 3
Justification :
A program is defined as a group of related projects, subprograms, and program activities managed in a coordinated way to
obtain benefits not available from managing them individually.
Reference: PMBOK®
PMstudy.com comments: Developing and launching a NASA satellite will involve two projects and hence, it is a program.

Question No : 114
A change in your project schedule has resulted in increased cost and risk. It has also impacted your resource plan. To co-
ordinate changes across the entire project, you will need to rely on which of the following:
Choice 1 Change control system
Choice 2 Perform Integrated Change Control
Choice 4 Changes to project plan baselines
Correct Choice : 2
Justification :
When required, the Perform Integrated Change Control process includes a Change Control Board (CCB)... unless they are
part of the CCB.
Reference: PMBOK®
PMstudy.com comments: The Perform Integrated Change Control process integrates all the individual change control
processes and determines the impact of changes across the entire project.

Question No : 115
In your project, while doing scope verification of the product, the customer points out that a particular work component
performed by a team member is not as per specification. You review the project WBS and confirm that the customer is
correct. What would be your NEXT step?
Choice 1 Put the particular requirement through the change control process
Choice 2 Call a meeting of your project team to discuss this requirement
Choice 3 Escalate the issue to your project sponsor
Choice 4 Review the requirement and talk with the team member who implemented the requirement
Correct Choice : 4
Justification :
The best option is to first review the requirement, contained in the project WBS, with the particular team member who has
implemented the requirement. Either the team member has not done the work properly or there might have been lack of
clarity in defining the requirement in the WBS.
Option 1: This should be done only after the requirement has been evaluated with the team member.
Option 2: There is no need to call a meeting of all team members. Discuss the matter with the team member who has
actually implemented the requirement.
Option 3: It is premature to escalate the issue to the project sponsor. First, you should evaluate why it went wrong.

Question No : 116
In your project, you monitor the status of the project to update the project progress. which of the following techniques would
you use?
A. Reserve analysis
B. Project management software
C. Resource optimization techniques
D. Performance reviews
Choice 1 B, C and D
Choice 2 A, C and D
Choice 3 A, B and D
Choice 4 A, B and C
Correct Choice : 1
Justification :
Control Schedule is the process to monitor the status of the project to update project progress and manage changes to the
schedule baseline.
The tools and techniques used in Control Schedule process are performance reviews, project management software,
resource optimization techniques, Modeling techniques, Leads and lags, schedule compression, and scheduling tool.
Reserve analysis is one of the techniques used in Estimate Activity Durations process and not in Control
Scheduleprocess.
Reference: PMBOK®

Question No : 117
In your project, you will use a code of accounts to:
Choice 1 Identify potential risks
Choice 2 Identify each component of the WBS
Choice 3 Facilitate activity duration estimates
Choice 4 Update project files
Correct Choice : 2
Justification :
Code of Accounts: Any numbering system used to uniquely identify each component of the work breakdown structure.
Reference: PMBOK®

Question No : 118
In a normal distribution, standard deviation refers to:
Choice 1 Distance of measurement from the mean
Choice 2 Distance of measurement from the most likely value
Choice 3 Distance of measurement from the middle most value
Choice 4 A tool that is used in qualitative risk analysis
Correct Choice : 1
Justification :
Standard deviation is a distance of measurement from the mean or, the square root of the average of the squares of
deviations (about) the mean of a set of data. Standard deviation is a statistical measure of spread or variability.
A standard normal distribution, which shows standard deviation (sigma) as distance of the measurement from the mean
value:

Question No : 119
You are the blue-eyed boy of your vice chairman who appreciates the way in which you work in projects. She also consults
you during performance appraisals. This helps you in managing interpersonal relationships with your team members,
because you have the following power:
Choice 1 Legitimate
Choice 2 Expert
Choice 3 Penalty
Choice 4 Referent
Correct Choice : 3
Justification :
The five interpersonal influences are:
• Legitimate Power: The ability to gain support because project personnel perceive the project manager as being officially
empowered to issue orders.
• Reward Power: The ability to gain support, because project personnel perceive the project manager as capable of directly
or indirectly dispensing valued organizational rewards such as salary, promotion, bonus, and future work assignments.
• Penalty Power: The ability to gain support, because the project personnel perceive the project manager as capable of
directly or indirectly dispensing penalties that they wish to avoid. Penalty power usually derives from the same source as
reward power, with one being a necessary condition for the other.
• Expert Power: The ability to gain support, because personnel perceive the project manager as possessing special
knowledge or expertise.
• Referent Power: The ability to gain support, because project personnel feel personally attracted to the project manager or
project.

Reference: Project Management - A Systems Approach to Planning, Scheduling and Controlling, pages 206 and 207
PMstudy.com comments:- Since you are involved with performance appraisals you have `Penality Power` and `Reward
Power`.
Question No : 120
As a project manager, you are in the process of creating, collecting, distributing, storing, retrieving, and the ultimate
disposition of project information in accordance with the communications management plan. Which of the following tools
should you use?
Choice 1 Stakeholder analysis
Choice 2 Communication methods
Choice 3 Expert judgement
Choice 4 Communication requirement analysis
Correct Choice : 2
Justification :
Manage Communications is the process of creating, collecting, distributing, storing, retrieving, and the ultimate disposition
of project information in accordance with the communications management plan. Communication methods is one of the
tools and techniques used for this process.
Reference: PMBOK®
Guide - Fifth Edition, page 297, figure 10-5

Question No : 121
In your project, which of the following facilitates the Control Risks process?
Choice 2 Analytical techniques
Choice 3 SWOT analysis
Choice 4 Assumptions analysis
Correct Choice : 1
Justification :
Reserve analysis is a tool used during the Control Risks process.
Reference: PMBOK®
PMstudy.com comments:
Option 2: Analytical techniques is used in the Plan Risk Management process
Option 3: SWOT analysis is used in the Identify Risks process
Option 4: Assumptions analysis is also used in the Identify Risks process.

Question No : 122
Your company is involved in the activity of identifying and documenting the norms for rating or scoring proposals at the
organization level. From a project management perspective, this can be referred to as:
Choice 1 Constraints
Choice 2 Source selection criteria
Choice 3 Assumptions
Choice 4 Best practices
Correct Choice : 2
Justification :
Selection criteria are developed and used to rate or score seller proposals.
Reference: PMBOK®

Question No : 123
Which of the following tools or techniques are used in all three of the Identify Stakeholders, Plan Stakeholder Management,
and Control Stakeholder Engagement processes?
Choice 1 Meetings and Expert judgment
Choice 2 Expert judgment and Information management systems
Choice 3 Meetings and Communication methods
Choice 4 Interpersonal skills and Management skills
Correct Choice : 1
Justification :
Meetings and Expert judgment are tools that appear in all three of the Identify Stakeholders, Plan Stakeholder
Management, and Control Stakeholder Engagement processes.
Option 2: Information management systems are used in the Control Stakeholder Engagement process.
Option 3: Communication methods are used in the Manage Stakeholder Engagement process.
Option 4: Interpersonal skills and Management skills are tools used in the Manage Stakeholder Engagement process.
Reference: PMBOK® Guide Fifth Edition, page 392, figure 13-1.

Question No : 124
You are in the build phase of your project, when you realize that because of a design error, the product will not meet the
performance parameters specified by the customer. In this context, you should:
Choice 1 Revise downward the performance parameters so that the product developed will satisfy those parameters
Choice 2 Discuss with your team to try and find alternative methods to solve the issue
Choice 3 Escalate to your management team
Choice 4 Ask for additional funding from your business sponsors to accommodate the new requirement
Correct Choice : 2
Justification :
Option 2: This is the correct answer. The first step should be to try and assess the problem within the team and then
explore alternative methods to solve the issue.
Option 1: This is unethical if done without consulting the customer.
Option 3: This is a measure to be taken if it is determined that alternatives are not available and there is going to be an
impact on project cost, schedule, or quality.
Option 4: Asking for additional funding should be done only after assessing the impact of the design error and after being
satisfied that additional funding will be required.

Question No : 125
Which of the following is NOT a Project Management Knowledge Area?
Choice 1 Project Integration Management
Choice 2 Project Procurement Management
Choice 3 Project Configuration Management
Choice 4 Project Communications Management
Correct Choice : 3
Justification :
Project Configuration Management is not a Project Management Knowledge Area.
Reference: PMBOK®

Question No : 126
You are the project manager for a medical device manufacturer responsible for developing a new low-cost prosthetic limb
for use in developing countries. This is a high profile project for your company and is being funded by $200M in grant
money from several charitable organizations. During implementation, you spend some time with your team in monitoring
and controlling the work being done by them. Which tool will you use?
Choice 1 Expert judgment
Choice 2 Project selection methods
Choice 4 Configuration management system
Correct Choice : 1
Justification :
Expert judgment is used by the project management team to interpret the information provided by the monitor and control
processes.
Reference: PMBOK®

Question No : 127
You are the project manager of a software company. You need ideas for project and product requirements. Which of the
following techniques will you use?
Choice 1 Flowcharting
Choice 2 Idea/Mind Mapping
Choice 3 Nominal Group Technique
Choice 4 Brainstorming
Correct Choice : 4
Justification :
Brainstorming: A general data gathering and creativity technique that can be used to identify risks, ideas, or solutions to
issues by using a group of team members or subject matter experts.
Reference: PMBOK®

Question No : 128
Since you are in the preliminary stages of your project, you estimate that your project may be completed in one year.
However, the optimistic estimate is 6 months and pessimistic estimate is 18 months. This type of estimate is also called:
Choice 1 Definitive
Choice 2 Capital cost
Choice 3 Order of magnitude
Choice 4 Feasibility
Correct Choice : 3
Justification :
The different types of estimates are:
Order of Magnitude: -25% to +75%
Budget Estimates: -10% to +25%
Definitive Estimates: -5% to +10%
Please note that the estimate varies from 1 year - 6 months to 1 year + 6 months (i.e. -25% to +75% variation, we can call
this an Order of Magnitude Estimate)

Question No : 129
You and your sponsor are in an important meeting to select a project from among other projects having similar
investments. In this context, you select the project with:
Choice 1 Higher life cycle cost
Choice 2 Lower life cycle cost
Choice 3 Higher sunk cost
Choice 4 Lower sunk cost
Correct Choice : 2
Justification :
Life Cycle Cost: The overall estimated cost for a particular program alternative over the time period corresponding to the
life of the program. It includes:
 Direct and Indirect Costs
 Periodic or continuing costs of operation and maintenance
Project Selection Criterion: For two projects having same investment, select a project with lower life cycle cost.
Sunk costs are already incurred, hence should not be taken into account in project selection.

Question No : 130
In the Plan Quality process, you are using benchmarking as a tool to facilitate quality planning. In this context, which of the
following statements about benchmarking is inaccurate?
Choice 1 Compares actual or planned project practices to those of other projects
Choice 2 Uses only information from within the performing organization
Choice 3 Generates ideas for improvement and provides a basis for measuring performance
Choice 4 Can be within the same or another application area
Correct Choice : 2
Justification :
Benchmarking involves comparing actual or planned project practices to those of comparable projects to identify best
practices, generate ideas for improvement, and provide a basis for measuring performance. Benchmarked projects may
exist within the performing organization or outside of it, or can be within the same application area.
Reference: PMBOK®

Question No : 131
In your project, you invest a lot of time in team development to increase the team`s performance, which in turn increases
the likelihood of meeting project objectives. Which of the following indicators will you NOT use to evaluate your team`s
effectiveness?
Choice 1 Improvement in skills of team members
Choice 2 Improvement in competencies and morale that help the team to perform better as a group
Choice 3 Decrease in staff-attrition (i.e., fewer people leaving the project team)
Choice 4 Delivery of project deliverables before time
Correct Choice : 4
Justification :
To evaluate the team`s effectiveness, we may include indicators such as:
 Improvements in skills that allow individuals to perform assignments more effectively
 Improvements in competencies that help the team to perform better as a team
 Reduced staff turnover rate
 Increased team cohesiveness whereby team members share information and experiences and help each other to
improve the overall project performance
Reference: PMBOK®
PMstudy.com comments: To evaluate the team`s effectiveness, we do not consider the project delivery parameters like
scope, time or cost. In this process, the emphasis is on developing the skills of individual team members, and their ability to
function as a team.

Question No : 132
As part of Project Communications Management, you are monitoring and controlling communications throughout the entire
project life cycle to ensure the information needs of the project stakeholders are met. This is done as part of:
Choice 1 Plan Communications Management
Choice 2 Manage Communications
Choice 3 Control Communications
Choice 4 Administrative closure
Correct Choice : 3
Justification :
Control Communications is the process of monitoring and controlling communications throughout the entire project life
cycle to ensure the information needs of the project stakeholders are met.
Reference: PMBOK®

Question No : 133
In the Identify Risks phase, you are working with your team to determine which risks may affect project performance.
Which of the following information gathering techniques can you use to facilitate the process?
Choice 1 Brainstorming, cause and effect diagrams, and P&I Matrix
Choice 2 Delphi technique, SWOT analysis, and risk audits
Choice 3 SWOT analysis, Decision tree, and influence diagrams
Choice 4 Brainstorming, Delphi technique, and root cause analysis
Correct Choice : 4
Justification :
Brainstorming, Delphi technique, interviewing, and root cause analysis are the information gathering techniques used in the
Identify Risks process.
Reference: PMBOK®
Option 1: Cause and effect diagrams are a type of diagramming technique (not information gathering). The P & I Matrix is
used in the Perform Qualitative Risk Analysis process.
Option 2: SWOT is not an Information Gathering technique. Risk audits are used to control risks.
Option 3: Decision Trees are used in the Perform Quantitative Risk Analysis process. Influence diagrams are a type of
diagramming technique.

Question No : 134
In your project, you would like to use the ‘Conduct Procurements’ process to obtain quotations for subcontracting your
work. Which of the following tools can be used to facilitate this process ?
A. Bidder conference
B. Meetings
C. Advertising
D. Procurement negotiations
Choice 1 B, C and D
Choice 2 A, C and D
Choice 3 C and D
Choice 4 Only A
Correct Choice : 2
Justification :
Meetings are not tools or techniques used in the Conduct Procurements process.
The tools and techniques used in this process are bidder conference, advertising, procurement negotiations, etc.
Reference: PMBOK®
PMstudy.com comments: Meetings are one of the tools and techniques for the Plan Procurement Management process.

Question No : 135
Engagement levels of stakeholders can be classified as follows:
Choice 1 Unaware, Resistant, Balanced, Supportive, and Aware
Choice 2 Unaware, Against, Neutral, Supportive, and Aware
Choice 3 Unaware, Resistant, Neutral, Aware, and Leading
Choice 4 Unaware, Resistant, Neutral, Supportive, and Leading
Correct Choice : 4
Justification :
Analytic techniques are used to assess the current and desired engagement level of stakeholders which can be classified
into Unaware, Resistant, Neutral, Supportive, and Leading engagement levels. This information can be documented in a
Stakeholders Engagement Assessment Matrix.

Question No : 136
You are the project manager of a very critical project, which will impact the lives of several people in your community. To
ensure the success of your project, you try to circulate accurate and truthful communication to the public through
advertisements and statements published in newspapers. This demonstrates that you are good at:
Choice 1 Defining scope and managing customer expectations
Choice 2 Managing your responsibility to the customer and the public
Choice 3 "Properly marketing promotional activities" as per Deming and Shewhart
Choice 4 Ensuring the successful completion of your project
Correct Choice : 2
Justification :
As per PMI, the following are the responsibilities of the project manager to the customer and the public:
1. Responsibility to provide accurate and truthful representations to the public in advertising, public statements and in the
preparation of estimates concerning costs, services, and expected results.
2. Responsibility to maintain and satisfy the scope and objectives of professional services, unless otherwise directed by the
customer.
3. Responsibility to maintain and respect the confidentiality of sensitive information obtained in the course of professional
activities or otherwise where a clear obligation exists.
PMstudy.com comments
Option 1: "Providing accurate and truthful representations to the public" will not help in proper scope definition.
Option 3: No such theories of Deming and Shewhart exist.
Option 4: "Providing accurate and truthful representations to the public" will not ensure successful project completion --
there are several other activities required to ensure project success.

Question No : 137
As a project manager, you have identified the stakeholders of your project. What should you do next?
Choice 1 Update Project Charter
Choice 2 Create Project Management Plan
Choice 3 Create Communications Management Plan
Choice 4 Create Stakeholder Register
Correct Choice : 4
Justification :
The main output of the Identify Stakeholder process is the Stakeholder Register. It is a project document including the
identification, assessment, and classification of project stakeholders.
Reference: PMBOK®

Question No : 138
You are in the process of creating a project plan for the launch of a new drug. While creating the plan, your finance
manager has provided some very useful insights for marketing the new drug. This shows that:
Choice 1 Every stakeholder has skills and knowledge that can be used in developing the project plan.
Choice 2 Finance managers usually have good knowledge about marketing activities.
Choice 3 Finance managers should always be involved when creating a project plan.
Choice 4 Finance managers and project managers should always work in tandem during project plan creation.
Correct Choice : 1
Justification :
Every stakeholder has skills and knowledge that can be utilized for developing the project plan. The project management
team must create an environment in which the stakeholders feel free to contribute.

Question No : 139
Project Scope Management includes the processes required to ensure that the project includes all the work required, and
only the work required, to complete the project successfully. In this context, a detailed project scope statement is prepared
as part of:
Choice 1 Collect Requirements
Choice 2 Create WBS
Choice 3 Scope Elaboration
Choice 4 Define Scope
Correct Choice : 4
Justification :
The project scope statement is prepared as part of the Define Scope process.
Reference: PMBOK®

Question No : 140
While creating a project schedule, what duration should a milestone have?
Choice 1 Zero
Choice 2 Duration equal to the phase duration
Choice 3 Duration equal to the time required for a particular task to be completed
Choice 4 Duration of the complete project till the milestone date
Correct Choice : 1
Justification :
Milestone is a significant point or event in a project, program, or portfolio.
Reference: PMBOK®
PMstudy.com comments: Since milestones only indicate when a particular task is going to be started or completed, they
will not have any duration, i.e., the duration for milestone is zero.

Question No : 141
The value of work actually accomplished is also known as
Choice 1 Planned Value
Choice 2 Earned Value
Choice 3 Actual Cost
Choice 4 Budgeted Cost for Work Scheduled (BCWS)
Correct Choice : 2
Justification :
Acronym Term Description Formula
PV
(BCWS)
Planned Value
(Budgeted Costs for
Work Scheduled)
Physical work to be scheduled,
including the estimated value of the
work
EV
(BCWP)
Earned Value
(Budgeted Costs for
Work Performed)
Physical work actually accomplished,
including estimated value of this work
AC Actual Cost Actual cost of the work completed
SV Schedule Variance
Negative SV: Behind Schedule
Positive SV: Ahead of Schedule
EV – PV
CV Cost Variance
Negative CV: Over Budget
Positive CV: Under Budget
EV – AC
CPI
Cost Performance
Index
Value got for $1 of Actual Cost EV/AC = BAC/EAC
SPI Schedule Progress as a % of Planned Progress EV/PV

Performance Index
Also, please refer to PMBOK®
Question No : 142
You are doing a quality audit for your project to identify all the gaps/shortcomings in your project. This is a part of:
Choice 1 Plan Quality process
Choice 2 Perform Quality Assurance process
Choice 3 Quality Management Plan
Choice 4 Control Quality process
Correct Choice : 2
Justification :
Quality audit is a tool and technique used in Perform Quality Assurance process.
Reference: PMBOK®

Question No : 143
In your project, you use the Develop Project Team process to improve the competencies and interaction of team members
to enhance project performance. The output from this process is:
Choice 1 Project staff assignments
Choice 2 Staffing management plan
Choice 3 Team performance assessments
Choice 4 All the above
Correct Choice : 3
Justification :
Project staff assignments are an output for the Acquire Project Team process. Staffing management plan is an output for
the Plan Human Resource Management process.
Reference: PMBOK®

Question No : 144
In your project, you would like to conduct a lessons learned session to identify project successes and failures, as well as
make recommendations to improve future project performance. This is done during:
Choice 1 Project closure
Choice 2 Project initiation
Choice 3 Project life cycle
Choice 4 Project execution and project closure
Correct Choice : 3
Justification :
During the project life cycle, the project team and key stakeholders identify lessons learned concerning all aspects of the
project. The lessons learned are compiled, documented, and distributed so that they become part of the historical
database. However, most of the organizations prefer post-implementation meetings and case studies to document lessons
learned.

Question No : 145
You are the project manager of a software company developing a new banking software product. You would like to obtain
information from various experts about the risks associated with your project. You decide to use the Delphi technique
because this keeps any one person from having undue influence on the outcome of the Identify Risks process. The Delphi
technique also has the added advantage that it:
Choice 1 Finds out a problem, discovers the reasons that led to it, and develops preventive actions.
Choice 2 Helps reduce bias in the data.
Choice 3 Examines the project from each of the SWOT perspectives to increase the breadth of the identified risks.
Choice 4 Provides a qualitative assessment of risk.
Correct Choice : 2
Justification :
The Delphi technique helps reduce bias in the data and keeps any one person from having undue influence on the
outcome.
Reference: PMBOK®
Option 1: This is an advantage of "Root cause analysis" technique.
Option 3: This is an advantage of "SWOT analysis".
Option 4: This is not valid in the Identify Risks process (where the Delphi technique is used). It happens in the Perform
Qualitative Risk Analysis process.

Question No : 146
Which of the following statements on time and material contracts is accurate?
Choice 1 These types of contracts resemble cost-reimbursable type arrangements, because they are close ended.
Choice 2 T&M contracts cannot grow in value like a cost-reimbursable contract.
Choice 3 The full value of the agreement is defined at the time of contract award.
Choice 4 Unit rates can be fixed by the buyer and seller when both parties agree on the values for specific resource
categories.
Correct Choice : 4
Justification :
Time and material (T&M) contracts ... are the types of contracts that resemble cost-reimbursable contracts in that they can
be left open ended and may be subject to a cost increase for the buyer. The full value of the agreement and the exact
quantity of items to be delivered may not be defined by the buyer at the time of the contract award. Thus, T&M contracts
can increase in contract value as if they are cost-reimbursable contracts.
Unit labor or material rates can be preset by the buyer and seller, including seller profit, when both parties agree on the
values for specific resource categories, such as senior engineers at specified rates per hour, or categories of materials at
specified rates per unit.
Reference: PMBOK®

Question No : 147
You are the project manager for a high-priority project that involves the creation of a new product that is expected to bring
the company out of debt within one year of the product’s release. At least half of the company’s employees have played a
significant role in the project. The project team is currently creating deliverables and everyone in the company is excited to
see the project moving along as per the project management plan. The wife of the company’s CEO often comes into the
office and loves to visit and socialize with company employees. She is very interested in the project and often asks you and
other team members specific details about the project and how things are going. One day, she presents an innovative idea
to you for an additional product feature that she thinks customers will love. What should be your NEXT step?
Choice 1 Advise her that the feature cannot be incorporated
Choice 2 Implement the feature since it sounds like a great idea
Choice 3 Talk to the CEO about his wife’s suggestion and see what he thinks
Choice 4 Tell her you’ll speak with some customers and see what they think about the new feature
Correct Choice : 1
Justification :
Since the feature was not a previously approved requirement and is not a request from a relevant project stakeholder, it
should not be implemented and would likely be considered gold plating. If the project manager determined that the feature
may be a valid one, then he or she could take it through the change control process to see if others agreed. Individuals like
the CEO’s wife, who are not relevant project stakeholders, need to be properly monitored and controlled. She is very
interested in the project, but since she is not an employee of the company, she is not a relevant stakeholder so she has
very little power and legitimacy. As the project manager, you could continue to keep her informed if this was considered
acceptable in the company, but she should not be continuously discussing the project with other team members who
should be engaged in completing their scheduled project activities.

Question No : 148
You have earned a doctorate from MIT and are currently working with a leading chip manufacturer. A seller you met at a
vendor conference requested you to be their part-time consultant to design an innovative automobile component. At MIT,
you did a similar project and are inclined to participate in the venture, as there is no conflict of interest involved. In this
context, it is advisable that you should:
Choice 1 Decline the seller`s offer, because it could be construed as conflict of interest by your company
Choice 2 Ask your senior management whether you can participate in this venture
Choice 3 Leave the company and take up the seller`s offer, because it interests you
Choice 4 Accept the seller`s offer and inform senior management
Correct Choice : 2
Justification :
Option 2 is the best choice. This is the first step that you should take. Once you inform the senior management, they may
allow you to take the part-time assignment with the seller, if they see no conflict of interest. If, on the other hand, your
company sees this as conflict of interest, you can go for Option 1 (Decline the seller`s offer) or option 3 (Leave the
company and take up the seller`s offer). Option 4 is not recommended; you should first inform the management before
accepting the seller`s offer.

Question No : 149
You are working as a project manager and are in the process of defining and documenting stakeholders` needs to meet
project objectives. What documents are you going to use for this purpose?
Choice 2 Requirements documentation
Choice 3 Stakeholder register
Choice 4 Project charter and stakeholder register
Correct Choice : 4
Justification :
Reference: PMBOK®
PMstudy.com comments: Collect Requirements is the process of determining, documenting, and managing stakeholder
needs and requirements to meet project objectives. Requirements documentation is an output for Collect Requirements
process. Scope management plan, requirements management plan, stakeholder management plan, project charter, and
stakeholder register are inputs to this process.

Question No : 150
In a job interview, you are asked to define the most important characteristic of a project manager. Which of the following
will be the best answer?
Choice 1 Subject matter expert
Choice 2 Integrator
Choice 3 Creative person
Choice 4 Risk minimizer
Correct Choice : 2
Justification :
In the project management context, integration includes characteristics of unification, consolidation, communication, and
integrative actions that are crucial to controlled project execution through completion, successfully managing stakeholder
expectations, and meeting requirements.
Reference: PMBOK®
PMstudy.com comments: The most important characteristic of a project manager is being an integrator who can manage
all the different interfaces of the project. The project manager should also be a good communicator, because a project
manager usually spends more than 90% of her time communicating with different project stakeholders.
Option 1: A project manager need not be a subject matter expert. There may be several subject matter experts from whom
the project manager can take advice when required.
Option 3: Creativity is desirable but not the most important characteristic of a project manager.
Option 4: A project manager should try to minimize risks in the project. However, this is not the most important
characteristic of a project manager.

Question No : 151
The customer and project manager need to validate the scope of the deliverables. This will help to:
Choice 1 Ensure proper project selection
Choice 2 Create WBS
Choice 3 Obtain customer`s acceptance of the project deliverables
Choice 4 Mitigate project risks
Correct Choice : 3
Justification :
Validate Scope is the process of formalizing acceptance of the completed project deliverables. The verified deliverables
obtained from the Control Quality process are reviewed with the customer or sponsor to ensure that they are completed
satisfactorily and have received formal acceptance of the deliverables by the customer or sponsor.
Reference: PMBOK®

Question No : 152
In your project, you wish to estimate the type and quantity of resources required for each activity. Which of the following
techniques will you use for this purpose?
Choice 2 Variance analysis
Choice 3 Assumptions analysis
Choice 4 Alternatives analysis
Correct Choice : 4
Justification :
Estimate Activity Resources is the process of estimating the type and quantities of material, people, equipment, or supplies
required to perform each activity. Alternatives analysis is one of the techniques used in the process.
The techniques specified in the other three options are not used in Estimate Activity Resources process.
Reference: PMBOK®
Guide - Fifth Edition, pages 160 and 161 (figure 6-12)

Question No : 153
Which of the following projects described below will you select?
Choice 1 Project A with sunk cost of $4,000 and an opportunity cost of $3,000
Choice 2 Project B with sunk cost of $5,000 and an opportunity cost of $3,000
Choice 3 Project C with sunk cost of $5,000
Choice 4 Cannot be determined from the above options.
Correct Choice : 4
Justification :
Sunk cost and opportunity cost are not considered as project selection criteria. So, we cannot use these criteria to
determine which project will be selected.

Question No : 154
You are the project manager in a company. You have to prepare a process improvement plan. Which of the following
would you not consider for this purpose?
Choice 1 Quality metrics
Choice 2 Targets for improved performance
Choice 3 Process boundaries and process metrics
Choice 4 Process configuration
Correct Choice : 1
Justification :
The areas to be considered in the process improvement plan include process boundaries, process configuration, process
metrics, and targets for improved performance.
Reference: PMBOK®
PMstudy.com comments: Quality Metric is an output of Plan Quality Management. A quality metric is an operational
definition that describes, in very specific terms, a project or product attribute and how the quality control process will
measure it. It is not used for determining process improvements.

Question No : 155
According to Herzberg`s theory, the absence of hygiene factors can create job dissatisfaction, but their presence does not
motivate or create satisfaction. Which of the following can be categorized as a hygiene factor?
Choice 1 Recognition
Choice 2 Responsibility
Choice 3 Advancement in career
Choice 4 Interpersonal relations
Correct Choice : 4
Justification :
Motivation-Hygiene Theory / Two-Factor Theory (Herzberg)
 Factors such as company policy, supervision, interpersonal relations, working conditions, and salary are hygiene
factors. The absence of hygiene factors can create job dissatisfaction, but their presence does not guarantee
motivation or satisfaction. So, improvement in hygiene factors (dissatisfiers) produces only short-term changes in
job attitudes and performance.
 Achievement, recognition, the work itself, responsibility, and advancement are motivators (satisfiers). They are
associated with long-term positive effects in job performance.
 The satisfiers relate to what a person does, while the dissatisfiers relate to the situation in which the person works.

Question No : 156
You are the project manager of an IT company. You are creating a collection and filing structure that details methods used
to gather and store various types of information, and also procedures to collect and disseminate updates and corrections to
the concerned stakeholders. Where will you include this information?
Choice 1 Information retrieval system
Choice 2 Information distribution methods
Choice 3 Communications management plan
Choice 4 Project records
Correct Choice : 3
Justification :
The communications management plan includes:
1. Communication needs of the stakeholders
2. Description of the information to be distributed, including reason for distribution, time frame, frequency, format, content,
level of detail
3. Identification of a person to receive, authorize, and release confidential information and its communication
4. Technologies/methods used to convey information
5. Resources allotted to communicate activities; and escalation process definition and identification Collection and filing
structure that details what methods will be used to gather and store various types of information
6. Flow charts, workflows with possible sequence of authorization, list of reports, and meeting plans, etc.
7. Constraints related to communications
8. Method of updating and refining the communications management plan as project progresses
Reference: PMBOK®
PMstudy.com comments: All the methods, planning documents etc. related to Communications Management are included
in the Communications Management Plan.

Question No : 157
As part of Perform Quantitative Risk Analysis process, you, as a project manager, have already done a sensitivity analysis,
created decision trees and done a project simulation using Monte Carlo technique. However, when you show your results
to your manager, she is not happy. She thinks that your analysis is not acceptable because:
Choice 1 Monte Carlo simulations are not a standard methodology used in the company for risk quantification.
Choice 2 The quantitative value of identified risks is too high.
Choice 3 You have not performed risk audits as part of your project.
Choice 4 You have not conducted an interview with the project stakeholders and subject matter experts.
Correct Choice : 4
Justification :
Interviewing techniques draw on experience and historical data to quantify the probability and impact of risks on project
objectives. The information needed depends upon the type of probability distributions that will be used... Documenting the
rationale of the risk ranges and the assumptions behind them are important components of the risk interview because they
can provide insight on the reliability and credibility of the analysis.
Reference: PMBOK®
Option 1: This may or may not be true. There is nothing in the question which suggests that Monte Carlo Analysis should
not be used and this is a standard tool for the Perform Quantitative Risk Analysis process.
Option 2: A high quantitative value of risks does not render the Perform Quantitative Risk Analysis process unacceptable.
Option 3: This refers to a tool and technique in the Control Risks (not the Perform Quantitative Risk Analysis) process.
Option 4: This is the correct answer. Since a risk interview was not conducted, the results of the Perform Quantitative Risk
Analysis process will not be dependable.

Question No : 158
In your project, you want to ensure that all prospective sellers have a clear and common understanding of the
procurements. In which of the following processes would you use bidder conferences as a tool?
Choice 1 Close Procurements
Choice 2 Conduct Procurements
Choice 3 Administer Procurements
Choice 4 Plan Procurements
Correct Choice : 2
Justification :
The tools and techniques used in Conduct Procurements process are bidder conferences, advertising, procurement
negotiations, etc.
Reference: PMBOK®

Question No : 159
You are working on a project that your company recently won through a bidding process. It is still very early in the project,
but the project charter is complete and you are now creating the stakeholder register. Which of the following would be
useful to help you identity the project stakeholders:
Choice 1 Procurement statement of work
Choice 2 Procurement documents
Choice 3 Business case
Correct Choice : 2
Justification :
Since this is a contract that was awarded to your company, the Procurement Documents (e.g., RFP) will have information
about who some of the project stakeholders are. This would be a good starting place to gather information about key
stakeholders and their respective roles in the project.

Question No : 160
You are discussing your project with a close friend and colleague in the company. You are worried that your project is
behind schedule and over budget. Your colleague explained how she was able to bring her project back on schedule by
taking out some non-critical tasks from the project scope without informing anyone in the organization. She advised you to
do likewise. In this context, you should:
Choice 1 Inform management about your colleague`s activities.
Choice 2 Get more information on how your colleague was able to get the project on schedule, so you can do something
similar for your project.
Choice 3 Do nothing and continue with your project as if nothing happened.
Choice 4 Try crashing your project.
Correct Choice : 1
Justification :
Option 1: This is the correct answer, as you are following PMI Code of Ethics and Professional Conduct. As per PMI Code
of Ethics and Professional Conduct, whenever you come across any illegal activity or impropriety, you should report it to
the management. Clearly, taking out tasks from the project scope without proper authorization is a violation of the Code.
Option 2: This is not recommended, as you are trying to copy an unethical practice.
Option 3: This is not recommended, as you should report your friend and also have a discussion with your manager about
the problems you are facing in your project.
Option 4: This is not recommended. Although crashing may shorten the project schedule, it increases project costs. Since
your project is already over budget, it will make things worse.

Question No : 161
You are responsible for managing a project in your company but you have least authority and have to constantly report to a
functional manager. To which organizational structure does your company belong?
Choice 1 Matrix
Choice 2 Functional
Choice 3 Projectized
Choice 4 Balanced
Correct Choice : 2
Justification :
A classic functional organization... Staff members are grouped by specialty, such as production, marketing, engineering,
and accounting at the top level.
Reference: PMBOK®
Guide - Fifth Edition, page 22 (table 2-1)
PMstudy.com comments: Project manager has least authority in a functional organization structure.

Question No : 162
As a project manager, you often have to deal with change requests to expand or reduce the project scope. Which of the
following will NOT be impacted if such changes are made?
Choice 2 Project documents
Choice 4 Product deliverables
Correct Choice : 1
Justification :
Changes can impact the project management plan, project documents, or product deliverables
Reference: PMBOK®
PMstudy.com comments: Frequent change requests to the project scope will not impact the project charter.

Question No : 163
You are a project manager in a manufacturing company. You are developing a new product. In this context, you are
conducting requirements workshop for the stakeholders to determine the product`s critical characteristics. Which technique
would you use for this purpose?
Choice 1 Quality function deployment
Choice 2 Joint application development
Choice 3 Voice of the customer
Choice 4 Juran`s improvement technique
Correct Choice : 1
Justification :
Quality Function Deployment (QFD) is an example of a facilitated workshop technique that helps determine critical
characteristics for new product development.
Reference: PMBOK®

Question No : 164
You are managing a transmission line project in a Historic Settlement. You have identified the Five Tasks that need to be
done as part of this project and represented them in the chart given below:
What is the slack of task 3?
Choice 1 1 Month
Choice 2 0 Months
Choice 3 2 Months
Choice 4 -1 Month
Correct Choice : 1
Justification :
Please refer to the figure below:

The lengths of the different paths are:
Start→ 1→ 2→ End: 10 Months
Since the longest path is Start→ 4→ 5→ End, this is the critical path. Length of the critical path is 12 Months.
Slack = 12 Months (critical path duration) - 11 Months (duration of path having task 3) = 1 Month

Question No : 165
In your project, you have included contingency allowances in the cost estimates of many schedule activities. In this context,
which of the following statements on contingency reserve is incorrect?
Choice 1 Quantitative analysis methods are used for developing contingency reserve.
Choice 2 Precise information on the project helps reduce contingency reserve.
Choice 3 Cost estimates may not include contingency reserve.
Choice 4 Contingency reserve may be a percentage of the estimated cost.
Correct Choice : 3
Justification :
The contingency reserve may be a percentage of the estimated cost, a fixed number, or may be developed by using
quantitative analysis methods. As more precise information about the project becomes available, the contingency reserve
may be used, reduced, or eliminated.
Reference: PMBOK®

Question No : 166
You are determining whether the project activities comply with organizational and project policies. This will be done as part
of:
Choice 1 Inspection
Choice 2 Quality audits
Choice 3 Quality improvement
Choice 4 Trend analysis
Correct Choice : 2
Justification :
A quality audit is a structured, independent process to determine whether project activities comply with organizational and
project policies, processes, and procedures.
Reference: PMBOK®

Question No : 167
In your project, you establish clear expectations regarding acceptable behavior by project team members. You believe that
early commitment to clear guidelines will decrease misunderstanding and increase productivity. These expectations and
guidelines are also known as:
Choice 1 Team-building activities
Choice 2 Ground rules
Choice 3 Interpersonal skills
Choice 4 Rules of conduct
Correct Choice : 2
Justification :
Ground rules establish clear expectations on acceptable behavior by project team members. Early commitment to clear
guidelines decreases misunderstandings and increases productivity. Discussing ground rules in areas such as code of
conduct, communication, working together, or meeting etiquette allows team members to discover values that are
important to one another.
Reference: PMBOK®

Question No : 168
In your project, as part of the Manage Communications process, you have created an information retrieval system, which
helps team members and stakeholders to share information. What will you do next?
Choice 1 Create a communications management plan
Choice 2 Identify and document the approach to communicate effectively and efficiently with stakeholders
Choice 3 Determine methods of accessing information for scheduled communications
Choice 4 Conduct regular status review meetings to exchange information on the project
Correct Choice : 4
Justification :
Option 4 (Meetings) is one of the tools and techniques used for the Control Communications process, which is performed
after the Manage Communications process.
Reference: PMBOK®
PMstudy.com comments: Activities stated in options 1, 2, and 3 are part of the Plan Communications Management process
(which is performed before the Manage Communications process).

Question No : 169
Please refer to the Decision Tree given below which shows the analysis of profit/loss for the two alternatives (i.e., build or
buy).
Which, out of the two alternatives of build or buy, should the project
manager recommend?
Choice 1 Build
Choice 2 Buy
Choice 3 Either build or buy
Choice 4 Sensitivity analysis before making a build/buy decision
Correct Choice : 1
Justification :
The project manager should recommend build because the expected value is higher for this alternative.

Question No : 170
You are a key participant in the RFP process for procuring services for your company using a Fixed Price with Economic
Price Adjustment contract. Selecting the right vendor is important as the contract spans three years and includes the
provision of key services for your business. You have worked with a previous supplier in the past for a number of years, but
your business is changing rapidly and you would like to see what other providers have to offer. You are now waiting for
proposals to come back and a seller contacts you saying that the product requirements are missing from the SOW. What
should you do?
Choice 1 Schedule a bidder conference
Choice 2 Tell him you can’t share it until his company is chosen as the seller
Choice 3 Send the requirements to all sellers
Choice 4 Tell him that they are not necessary and he should work with what he has
Correct Choice : 3
Justification :
Sellers need to be provided with sufficient information to allow them to provide an accurate and complete response. The
product requirements are key to understanding the scope of the contract.
Option 1: Although a bidder conference may be a good idea, the sellers first need to have the proper requirements
included in the RFP so that they can review these details prior to the bidder conference. The bidder conference can then
be used to ensure that each seller has a clear understanding of all requirements for the contract.
Option 2: Each seller needs to provide procurement documents which have the required details. If confidentiality of the
information is an issue, then the buyer can have sellers sign non-disclosure agreements before they are provided with any
confidential information.
Option 4: It would be difficult for the seller to create a proposal without the appropriate requirements.
Reference: PMBOK®

Question No : 171
You are the project manager for a high priority project for your company. You just came out of a meeting with the project
sponsor where you informed her that the project’s current SPI is .7 and the CPI is 1.3. On your way back to your desk, you
pass by some team members who appear to be engaged in a dispute, so you ask them what’s going on. It seems that one
of the team members had been discussing the product requirements with the operation’s manager who made some valid
requests for the product that he thinks should be part of the product’s scope. The other team member says the operation’s
manager was not an identified stakeholder for the project so his requirements should not be considered. As the project
manager, what should you do?
Choice 1 Identify the operation’s manager as a valid stakeholder and review his requests and possibly take them through
change control.
Choice 2 Tell the team members to confront their issue and work it out among themselves.
Choice 3 Tell the team members you will advise the operation’s manager that the team will discuss his requests and get
back to him.
Choice 4 Tell the team members to stop wasting time arguing and get back to work since the project is behind schedule.
Correct Choice : 1
Justification :
In an operations or manufacturing setting, it is desirable to include operational stakeholders, such as the manufacturing
manager and other plant and production personnel, as relevant stakeholders for the project. Since they will be creating the
final product deliverables, they may have valuable input that should be considered throughout the project life cycle.
Engaging operational stakeholders in the project’s planning and other phases will help to mitigate or eliminate project risks
or post-project issues.

Question No : 172
While reviewing a land purchase agreement with the government, the project manager thought that some clauses in the
agreement were not in order. She consulted the company lawyer, who advised her that all the legal formalities and
procedures were properly followed as per the state laws. However, the project manager was not satisfied with the
explanation given by the company lawyer. To find out a solution to this issue, she should:
Choice 1 Discuss the issue with a friend, who is a corporate lawyer in another firm.
Choice 2 Inform the senior manager about possible misconduct in the land purchase agreement.
Choice 3 Trust the company lawyer and go ahead with the project.
Choice 4 Report the issue to PMI and seek their advice.
Correct Choice : 3
Justification :
Option 3: This is the correct answer. We must differentiate between "formalities and procedures" vs. "practices. For
example, telling lies, fraud, etc., are improper practices, which must be reported and acted upon". The project manager,
however, is not competent to question the correctness of the company`s legal formalities and procedures. So, if the
company lawyer advises her that "all the legal formalities and procedures were appropriately followed as per the state
laws," the project manager should take his advice.
Option 1: This is not the best choice, since the matter, which might be proprietary should not be discussed with outsiders to
the organization.
Option 2: The project manager should not bring up the issue with the senior manager, since she is not competent to
question the legal opinion of the company lawyer.
Option 4: No improper practice is involved here and therefore should not be reported to PMI. PMI does not concern itself
with individual instances of perceived impropriety.

Question No : 173
Which of the following is not an example of a project?
Choice 1 Develop a new product or service or result
Choice 2 Change the password of a user for logging into a bank website
Choice 3 Run a campaign for political office
Choice 4 Implement a new business procedure or process
Correct Choice : 2
Justification :
A project is a temporary endeavor undertaken to create a unique product, service, or result. Operations are ongoing
endeavors that produce repetitive outputs, with resources assigned to do basically the same set of tasks according to the
standards institutionalized in a product life cycle. Unlike the ongoing nature of operations, projects are temporary
endeavors.
Reference: PMBOK®
PMstudy.com comments: Changing the password of a user for logging into a website is an operation because:
a) It is not a unique activity.
b) It does not have a specific start and end date, i.e., passwords need to be changed whenever there is a request from any
user.
The activities stated in all the other options are examples of projects.

Question No : 174
The project is at an initial stage where the project team members are beginning to get acquainted with each other. A few
conflicts occur among different project stakeholders. Which of the following activities is NOT performed by the project
manager to ensure the success of the project?
Choice 1 Coordinate activities among all project team members
Choice 2 Coordinate activities between project sponsor and external stakeholders
Choice 3 Coordinate activities among all internal project stakeholders
Choice 4 Coordinate activities among external interfaces and competitors
Correct Choice : 4
Justification :
The project manager is responsible for coordinating activities of all the relevant internal and external stakeholders of the
project. The project manager would not coordinate activities among competitors.

Question No : 175
You are managing the changes made to the scope baseline. The causes of variances and the reasoning behind the
corrective action chosen should be included in:
Choice 1 Recommended corrective action
Choice 3 Scope management plan
Choice 4 Organizational process assets updates
Correct Choice : 4
Justification :
Organizational process assets updates: Organizational process assets that may be updated include, but are not limited to:
causes of variances, corrective action chosen and the reasons, and other types of lessons learned from project scope
control.
Reference: PMBOK®

Question No : 176
In Estimate Activity Duration process, which of the following is not an assumption?
Choice 1 Existing conditions
Choice 2 Availability of information
Choice 3 Length of the reporting periods
Choice 4 Project scope
Correct Choice : 4
Justification :
Examples of assumptions include, but are not limited to, existing conditions, availability of information, and length of the
reporting periods.
Reference: PMBOK®

Question No : 177
The following are the details of a project:
Payback: $2,000
Profit: $1,000
Project cost: $800
Life cycle cost: $1200
What is the Benefit Cost Ratio for this project?
Choice 1 2.50
Choice 2 1.25
Choice 3 1.67
Choice 4 0.83
Correct Choice : 1
Justification :
BCR = Payback/Project Cost = 2000/800 = 2.50
 Benefit Cost Ratio (BCR) = Benefits (or Payback or Revenue)/ Costs
 Project Selection Criterion: Select project with higher BCR
 BCR > 1 means that benefits (i.e. expected revenue) is greater than the cost. Hence, it is beneficial to do the project.
Example: There are 2 projects. Project A has an investment of $500,000 and a BCR of 2.5. Project B has an investment of
$300,000 and a BCR of 1.5. Using Benefit Cost Ratio criterion, which project will you select?
Answer: Project A will be selected. The fact that project B has a smaller investment than project A will not impact the
selection.

Question No : 178
Juran defines quality as "fitness for use." In this context, which of the following is NOT a primary benefit of meeting quality
requirements?
Choice 1 Moderate productivity
Choice 2 Low cost
Choice 3 Less rework
Choice 4 Increased stakeholder satisfaction
Correct Choice : 1
Justification :
The primary benefits of meeting quality requirements include less rework, higher productivity, lower costs, increased
stakeholder satisfaction and increased profitability.
Reference: PMBOK®

Question No : 179
Once ground rules are established and communicated to the project team, the responsibility of enforcing these rules lies
with the:
Choice 1 Project manager
Choice 2 Project management team
Choice 3 Project team members
Choice 4 Project sponsor and project manager
Correct Choice : 3
Justification :
All project team members share responsibility for enforcing the rules once they are established.
Reference: PMBOK®

Question No : 180
You are the project manager with seven team members. One more member will be joining the team after a week. What will
be the number of communication channels once the new member joins your team?
Choice 1 28
Choice 2 21
Choice 3 18
Choice 4 36
Correct Choice : 4
Justification :
There will be 9 people in your team (this includes 8 team members and you, the project manager). So, the number of
communication channels = 9 x (9 - 1) / 2 = 9x8/2 = 36.

Question No : 181
In Plan Risk Responses process, you are developing options and actions to reduce threats to your project`s objectives.
When you show the results 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:
Choice 1 Risk acceptance
Choice 2 Risk avoidance
Choice 3 Risk mitigation
Choice 4 Risk transfer
Correct Choice : 2
Justification :
Risk avoidance involves changing the project management plan to eliminate the threat entirely. The project manager may
also isolate the project objectives from the risk`s impact or change the objective that is in jeopardy. Examples of this
include extending the schedule, changing the strategy, or reducing scope.
Reference: PMBOK®

Question No : 182
You are in the process of determining the types of contracts to be used, the procurement documents you will provide, and
how to manage multiple providers. You can get the guidance for doing these activities through the:
Choice 1 Project plan
Choice 2 Procurement document
Choice 3 Procurement management plan
Choice 4 Proposals
Correct Choice : 3
Justification :
The procurement management plan describes how the procurement processes will be managed from developing
procurement documents through contract closure. The procurement management plan can include guidance for:
- Types of contracts to be used
- Whether independent estimates will be used and whether they are needed as evaluation criteria
- Managing multiple suppliers
Reference: PMBOK®

Question No : 183
The project manager needs to effectively engage stakeholders throughout the project life cycle. Analytical techniques can
be used to identify the current and desired engagement levels of each stakeholder. This information is captured in:
Choice 1 Stakeholder analysis matrix
Choice 2 Analytical forecasts
Choice 3 Stakeholders Engagement Assessment Matrix
Correct Choice : 3
Justification :
The Stakeholders Engagement Assessment Matrix (see below) is used to document current and desired engagement
levels of project stakeholders.
Stakeholder Unaware Resistant Neutral Supportive Leading
Stakeholder 1 C D
Stakeholder 2 C D
Stakeholder 3 D C
C = Current Engagement Level; D = Desired Engagement Level

Question No : 184
You are in the closing stage of the project. While reviewing the product, you have come to know that the tolerance is 0.05
microns more than what was specified in the project requirements. This is a very minor deviation, and you know that your
customer will not notice it during product delivery. Also, it will not adversely impact your customer when the product is put
to actual use. What should you do in this situation?
Choice 1 Inform the customer about the deviation
Choice 2 Change the project documents to allow for small deviations
Choice 3 Ask your project team to make changes to the product
Choice 4 Create a change request to make changes in the product
Correct Choice : 1
Justification :
It is the project manager`s responsibility to maintain and satisfy the scope and objectives of professional services, unless
otherwise directed by the customer.
Option 1: This is the correct answer. According to PMI, if there is any change in the project or product scope, it has to be
explained to the customer, who can then make an informed decision.
Option 2: The project manager should not change the project requirements or project documents without prior approval of
the sponsor and the customer.
Option 3: This is not the best choice. First the project manager should talk to the customer. Since this is a minor deviation,
chances are that the customer might accept the product. If the customer does not accept, then the project team should be
asked to rectify the discrepancy.
Option 4: This is not the best choice. First the project manager should talk to the customer. Since the deviation is minor in
nature, chances are that the customer might accept the product. If, on the other hand, the customer is not satisfied, then
the project manager can direct the team to correct the error and a change request need not be created, as the deviation is
minor in nature.

Question No : 185
Organizations performing projects will usually divide each project into several project phases to improve management
control. This also provides links to the ongoing operations of the performing organization. Collectively, project phases are
also called:
Choice 1 Project management life cycle
Choice 2 Project life cycle
Choice 3 Product life cycle
Choice 4 Project phases life cycle
Correct Choice : 2
Justification :
A project life cycle is the series of phases that a project passes through from its initiation to its closure.
Reference: PMBOK®

Question No : 186
You are in the process of developing a project charter for your project and would like to use organizational process assets
as inputs for the purpose. In this context, which of the following statements about organizational process assets is NOT
correct?
Choice 1 Organizational process assets do not include organization communication requirements.
Choice 2 Any and all the process related assets that are used to influence the project`s success can be drawn upon from
any or all of the involved organizations.
Choice 3 Organizational process assets represent the lessons learned by the company from previous projects.
Choice 4 Organizational standard process, policies, and standardized process definitions are used in the organization.
Correct Choice : 1
Justification :
The organization`s processes and procedures for conducting project work include... project closure guidelines or
requirements.
The organizational process assets that can influence the Develop Project Charter process include but are not limited to:
organizational standard processes, policies, and process definitions, templates (e.g., project charter template), historical
information and lessons learned knowledge base, etc.
Reference: PMBOK®
Guide - Fifth Edition, pages 27, 28, and 70

Question No : 187
Your company is contracting a sub-project to another company. The company which accepts the subproject should:
Choice 1 Use the WBS of a similar project from another client
Choice 2 Create a more detailed WBS for the contracted work from the work package that was contracted
Choice 3 Break down the WBS of the parent project to WBS packages
Choice 4 Use the WBS Dictionaries of the parent project to assign work
Correct Choice : 2
Justification :
The items at the lowest level of the WBS may be referred to as work packages, especially in organizations that follow
Earned Value Management practices. These work packages may in turn be decomposed in a subproject work breakdown
structure. Generally this type of approach is used when the project manager is assigning a scope of work to another
organization. The other organization must plan and manage the scope of work at a more detailed level than the scope of
work that was specified in the original project.

Question No : 188
In your project, you wish to calculate early start and finish dates for each task. For this purpose, which of the following will
you use?
Choice 1 ADM
Choice 2 CPM
Choice 3 GERT
Choice 4 CERT
Correct Choice : 2
Justification :
The critical path method (CPM) calculates the theoretical early start and finish dates, and late start and finish dates, for all
activities without regard for any resource limitations, by performing a forward and backward pass analysis through the
schedule network.
Reference: PMBOK®
PMstudy.com comments: Critical path method (CPM) calculates a single, deterministic early and late start and finish dates
for each activity based on specified sequential network logic and a single duration estimate.

Question No : 189
In your construction project, the CPI is 0.85 and SPI is 1.25. What could be the possible reason?
Choice 1 A critical resource went on sick leave for a long period of time, which had not been anticipated earlier.
Choice 2 The cost of raw materials required for construction increased by 10%. You had anticipated a cost increase of 12%
in your project plans.
Choice 3 In anticipation of delays, the project was crashed to decrease the duration.
Choice 4 There was four days waiting time in the curing of concrete, and work could not be done during that time.
Correct Choice : 3
Justification :
Option 3: This is the correct answer, because crashing of a project results in decreased duration and increased costs. This
verifies the given data on CPI and SPI.
Options 1 and 4: They are ruled out, because they do not verify the given data that SPI>1.
Option 2: This is also ruled out, because it does not verify the given data that CPI<1.

Question No : 190
In your organization, 3 sigma quality processes have been implemented. This means that there is a _____% probability
that any result will fall within the 3 sigma range.
Choice 1 99.99
Choice 2 99.7
Choice 3 95.4
Choice 4 68.2
Correct Choice : 2
Justification :
A standard normal distribution, which shows standard deviation (or sigma) as distance of the measurement from the mean
(target) value:

Question No : 191
Which of the following does NOT refer to power derived from the position of the project manager in the organization?
Choice 1 Penalty
Choice 2 Expert
Choice 3 Legitimate
Choice 4 Reward
Correct Choice : 2
Justification :
Expert and Referent power are examples of personal power that comes from personal qualities to which team members
are attracted. Legitimate, Reward, and Penalty power are often referred to as examples of position power, which is directly
related to one’s position within the organization. The five interpersonal influences are:
Legitimate Power: The ability to gain support, because project personnel perceive the project manager as being officially
empowered to issue orders.
Reward Power: The ability to gain support, because project personnel perceive the project manager as capable of directly
or indirectly dispensing valued organizational rewards (i.e., salary, promotion, bonus, and future work assignments).
Penalty Power: The ability to gain support, because the project personnel perceive the project manager as capable of
directly or indirectly dispensing penalties that they wish to avoid. Penalty power usually derives from the same source as
reward power, with one being a necessary condition for the other.
Expert Power: The ability to gain support, because personnel perceive the project manager as possessing special
knowledge or expertise.
Reference: Project Management - A Systems Approach to Planning, Scheduling and Controlling; pages 206, 207, and 208

Question No : 192
You have a project team of forty people colocated at Houston, Texas. Email and notes are frequently used to communicate
among team members. These are examples of which type of communication?
Choice 1 Written Formal
Choice 2 Written Informal
Choice 3 Oral Formal
Choice 4 Oral Informal
Correct Choice : 2
Justification :
E-mails, notes, etc., are examples of written informal type of communication. More information on forms of communication
is given below:
Form of
Communication
• Complex issues
• Memos
• Negotiations

telephone
Non-verbal
Communication
communication
Reference:
 Project Management - A Systems Approach To Planning, Scheduling and Controlling, Ninth Edition, page 273.
 PMstudy.com study notes

Question No : 193
Even after carefully performing risk management for the project, you realize that possibility of new risks occurring in the
future still exists. You will be able to handle such risks if you perform:
Choice 1 Plan Risk Management
Choice 2 Identify Risks
Choice 3 Control Risks
Choice 4 Plan Risk Responses
Correct Choice : 3
Justification :
Control Risks is the process of implementing risk response plans, tracking identified risks, monitoring residual risks,
identifying new risks, and evaluating risk process effectiveness throughout the project.
Reference: PMBOK®

Question No : 194
Which of the following statements related to managing different types of procurement contracts is NOT accurate?
Choice 1 In a fixed-price, incentive-fee contract, there is no incentive for the seller to decrease costs.
Choice 2 In a fixed-price contract, there is highest risk to the seller and lowest risk to the buyer.
Choice 3 Fixed price with redetermination retroactive contracts allow for adjusting of contract price after performance has
been completed.
Choice 4 Fixed price with economic price adjustment allows for price increases if the contract is for multiple years.
Correct Choice : 1
Justification :
A fixed-price, incentive-fee contract provides for incentive to the seller to decrease costs and increase profits. Both the
buyer and the seller share in the risks and savings.

Question No : 195
You are in the process of identifying the relevant stakeholders in the project. In this context, which of the following are
relevant output(s) of the process?
Choice 2 Project document updates
Choice 3 Organizational process assets updates
Choice 4 Stakeholder register and project document updates
Correct Choice : 1
Justification :
Stakeholder register is the only output of the Identify Stakeholders process.
Reference: PMBOK®
Guide - Fifth Edition, page 392, figure 13-1

Question No : 196
Your friend requests you to lend him your accounting package software CDROM to install the software in his computer.
You should:
Choice 1 Give him the software for free
Choice 2 Give him the software and charge some money for it
Choice 3 Refuse to give him the software
Choice 4 Report the copyright violation to the copyright owner of the software package
Correct Choice : 3
Justification :
Software is an intellectual property (like a book, article written, etc.) and should not be distributed without prior
license/approval. So, option 3 is the best answer.
Options 1 and 2 talk about distribution of the software, which is not an accepted professional conduct.
Option 4 is not valid: Your friend has not started using the software. Hence there is no copyright violation.

Question No : 197
You are the project manager in a company, which has a balanced matrix organizational structure. Who do you report to?
Choice 1 Functional Manager
Choice 2 Program Manager
Choice 3 Chief Project Manager
Choice 4 Portfolio Sponsor
Correct Choice : 1
Justification :
The project manager reports to the functional manager in a balanced matrix organization. Also, please refer
to PMBOK®
Guide - Fifth Edition, page 24 (figure 2-3).

Question No : 198
Which of the following is not related to the Direct and Manage Project Work process?
Choice 1 Manage sellers and suppliers
Choice 2 Create project deliverables to meet the planned project work
Choice 3 Implement the planned methods and standards
Choice 4 Change control tools
Correct Choice : 4
Justification :
Change control tools is a technique used in Perform Integrated Change Control process.
The activities performed during the Direct and Manage Project Work process include, but are not limited to manage sellers
and suppliers, create project deliverables to meet the planned project work, implement the planned methods and
standards, etc.
Reference: PMBOK®
Guide - Fifth Edition, pages 80, 81, and 94 (figure 4-10)

Question No : 199
You have recently joined as the project manager of ABC Company. You notice that the customers are getting frequent
change requests implemented by informally approaching the team members. This has resulted in work disruption and
discontent among team members. What should be your FIRST priority to remedy the situation?
Choice 1 Create a detailed project scope statement
Choice 2 Align the project objectives with the organizational goals
Choice 3 Ensure proper project scope control
Choice 4 Call a meeting of all the project stakeholders to resolve any outstanding issues
Correct Choice : 3
Justification :
Controlling the project scope ensures all requested changes and recommended corrective or preventive actions are
processed through the Perform Integrated Change Control process. Control Scope is also used to manage the actual
changes when they occur and is integrated with the other control processes. The uncontrolled expansion to product or
project scope without adjustments to time, cost, and resources is referred to as scope creep.
Reference: PMBOK®
PMstudy.com comments: Option 1: The project scope statement should already be prepared since the project is in
execution stage.
Option 2: Aligning the project objectives with the organizational goals happens in initial stages of the project, i.e., when the
project charter is being created.
Option 3: This is the correct answer. Usually, if there is no proper project scope control, there might be scope creep,
reprioritization of activities and discontent among team members who do not know what each person is supposed to be
doing. Had the change requests been routed through the project manager and the Perform Integrated Change Control
process, the scope creep would not have arisen.
Option 4: Calling a meeting will not resolve the outstanding issues related to scope creep and will not ensure proper project
scope control.

Question No : 200
In your project, you prefer bar charts over project network diagrams for the purpose of:
Choice 1 Making presentations to the middle management
Choice 2 Determining the critical path of the project
Choice 3 Determining the start and finish dates for each activity
Choice 4 Determining the critical path of the project and start and finish dates for each activity
Correct Choice : 1
Justification :
Bar charts are relatively easy to read and are frequently used in management presentations.
Reference: PMBOK®
PMstudy.com comments: Milestone charts are used to make presentations to senior management, but bar charts are
usually used to make presentations to middle or junior management.

Pmstudy exam 3

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Pmstudy exam 3