Question 1

If the NPV for a project is < 0,it indicates that the project will __________.

Accepted Answer

A) report a profit loss 
B) report a profit gain 
C) fail to cover its required rate of return 
D) fail to generate cash inflows 
A) report a profit loss 
B) report a profit gain 
C) fail to cover its required rate of return 
D) fail to generate cash inflows C

Question 2

A project selection criteria that focuses on environmental and social issues is

Accepted Answer

A) sustainability 
B) comparative benefit model 
C) production line extension 
D) operating necessity 
A) sustainability 
B) comparative benefit model 
C) production line extension 
D) operating necessity A

Question 3

Which of the following should not be members of the project council?

Accepted Answer

A) Senior management 
B) Accounting department 
C) Project owners or sponsors of major projects 
D) Head of the project management office 
A) Senior management 
B) Accounting department 
C) Project owners or sponsors of major projects 
D) Head of the project management office B

Question 4

Suppose that you have been assigned as the project manager to execute a project that was selected using the sacred cow method of project selection.The project sponsor is an executive who has been with the company for three years.Based on past employment history,the average tenure of a senior executive at your company is 5 years.After reviewing the project's expectations and requirements,the project team has determined that the payback period will be 3.5 years.What are the implications for you and the project team?

Accepted Answer

Many projects are terminated before they

Question 5

The drawback of the __________ model is that it fails to consider cash flows obtained once the initial investment has been recovered.

Accepted Answer

A) payback period 
B) average rate of return 
C) discounted cash flow 
D) profitability index 
A) payback period 
B) average rate of return 
C) discounted cash flow 
D) profitability index

Question 6

Wheelwright identified four separate categories of projects.Which of the following are not one of those categories?

Accepted Answer

A) Sacred cow projects 
B) Platform projects 
C) Breakthrough projects 
D) R&D projects 
A) Sacred cow projects 
B) Platform projects 
C) Breakthrough projects 
D) R&D projects

Question 7

Firms usually have two or more projects and this collection of projects is referred to as __________.

Accepted Answer

A) a portfolio 
B) an initiation 
C) a program 
D) a stochastic model 
A) a portfolio 
B) an initiation 
C) a program 
D) a stochastic model

Question 8

Which of the following is a type of numeric model?

Accepted Answer

A) the sacred cow 
B) the operating necessity 
C) payback period 
D) the product line extension 
A) the sacred cow 
B) the operating necessity 
C) payback period 
D) the product line extension

Question 9

In a project portfolio,a project that involves a new technology or even a disruptive technology that is known to the industry would serve as an example of a __________ project.

Accepted Answer

A) breakthrough 
B) R&D 
C) platform 
D) derivative 
A) breakthrough 
B) R&D 
C) platform 
D) derivative

Question 10

The underlying premise of the real options approach is that __________.

Accepted Answer

A) delaying an investment may lead to greater returns or may lead to elimination of marginal projects 
B) rushing into an investment more quickly may lead to lower returns or may lead to elimination of marginal projects 
C) delaying an investment may lead to increased costs due to delays 
D) rushing into an investment more quickly may lead to less risk 
A) delaying an investment may lead to greater returns or may lead to elimination of marginal projects 
B) rushing into an investment more quickly may lead to lower returns or may lead to elimination of marginal projects 
C) delaying an investment may lead to increased costs due to delays 
D) rushing into an investment more quickly may lead to less risk

Question 11

If a system is being updated due to operating necessity,the project was selected because__________.

Accepted Answer

A) the system is worth saving at any cost 
B) the system is worth saving at the estimated cost of the project 
C) the dimension of cost is not relevant to execution of the project 
D) the cost overruns can be hidden in someone else's budget 
A) the system is worth saving at any cost 
B) the system is worth saving at the estimated cost of the project 
C) the dimension of cost is not relevant to execution of the project 
D) the cost overruns can be hidden in someone else's budget

Question 12

There is usually some oversight committee,typically called a _____ or such,for every project,of which the project owner is usually a member.

Accepted Answer

A) task force 
B) steering committee 
C) project management office 
D) project council 
A) task force 
B) steering committee 
C) project management office 
D) project council

Question 13

__________ is the process of evaluating individual projects or groups of projects,and then choosing to implement some set of them so that the objectives of the parent organization will be achieved.

Accepted Answer

A) Project selection 
B) Project initiation 
C) Project management 
D) Project control 
A) Project selection 
B) Project initiation 
C) Project management 
D) Project control

Question 14

Contrast the real options selection approach with profitability models.

Accepted Answer

Profitability models analyze a potential

Question 15

A project has four criteria,represented by A-D.There weights are 0.1,0.2,0.4,and 0.3.A particular project has scores of 4,5,8,and 9 respectively.What is its total score for the project?

Accepted Answer

A) 6.5 
B) 7.1 
C) 7.3 
D) 26 
A) 6.5 
B) 7.1 
C) 7.3 
D) 26

Question 16

Which of the following is not an advantage that favors the use of weighted scoring models?

Accepted Answer

A) Multiple objectives can be considered. 
B) Decision makers are compelled to stick with the decision once it has been made. 
C) The models can be adapted to changes in managerial philosophy. 
D) They can help avoid a short-term focus on profitability. 
A) Multiple objectives can be considered. 
B) Decision makers are compelled to stick with the decision once it has been made. 
C) The models can be adapted to changes in managerial philosophy. 
D) They can help avoid a short-term focus on profitability.

Question 17

If a company raises their hurdle rate,what happens to the net present value (NPV)of their projects?

Accepted Answer

A) Goes up 
B) Unchanged 
C) Goes down 
D) Positive NPV's go up,negative NPV's go down 
A) Goes up 
B) Unchanged 
C) Goes down 
D) Positive NPV's go up,negative NPV's go down

Question 18

Explain the difference between risk and uncertainty.

Accepted Answer

Uncertainty means that it is possible to

Question 19

Real options seek to reduce which of the following risks in projects?

Accepted Answer

A) political 
B) environmental 
C) technological and commercial 
D) sociological 
A) political 
B) environmental 
C) technological and commercial 
D) sociological

Question 20

The __________ is the interest rate set by an organization as the minimum acceptable rate of return for a project.

Accepted Answer

A) hurdle rate 
B) acceptable rate 
C) internal rate of return 
D) net present value 
A) hurdle rate 
B) acceptable rate 
C) internal rate of return 
D) net present value

If the NPV for a project is < 0,it indicates that the project will __________.

A project selection criteria that focuses on environmental and social issues is

Which of the following should not be members of the project council?

The drawback of the __________ model is that it fails to consider cash flows obtained once the initial investment has been recovered.

Wheelwright identified four separate categories of projects.Which of the following are not one of those categories?

Firms usually have two or more projects and this collection of projects is referred to as __________.

Which of the following is a type of numeric model?

In a project portfolio,a project that involves a new technology or even a disruptive technology that is known to the industry would serve as an example of a __________ project.

The underlying premise of the real options approach is that __________.

If a system is being updated due to operating necessity,the project was selected because__________.

There is usually some oversight committee,typically called a _____ or such,for every project,of which the project owner is usually a member.

__________ is the process of evaluating individual projects or groups of projects,and then choosing to implement some set of them so that the objectives of the parent organization will be achieved.

Contrast the real options selection approach with profitability models.

A project has four criteria,represented by A-D.There weights are 0.1,0.2,0.4,and 0.3.A particular project has scores of 4,5,8,and 9 respectively.What is its total score for the project?

Which of the following is not an advantage that favors the use of weighted scoring models?

If a company raises their hurdle rate,what happens to the net present value (NPV)of their projects?

Explain the difference between risk and uncertainty.

Real options seek to reduce which of the following risks in projects?

The __________ is the interest rate set by an organization as the minimum acceptable rate of return for a project.

Projects in Contemporary Organizations

The Project Manager

Managing Conflict and the Art of Negotiation

The Project in the Organizational Structure

Activity Planning: Traditional and Agile

Budgeting and Risk Management

Scheduling

Resource Allocation

Monitoring and Information Systems

Project Control

Project Auditing

Project Closure and Benefits Realization

Filters

Exam 2: Strategic Management and Project Selection

If the NPV for a project is < 0,it indicates that the project will __________.

A project selection criteria that focuses on environmental and social issues is

Which of the following should not be members of the project council?

The drawback of the __________ model is that it fails to consider cash flows obtained once the initial investment has been recovered.

Wheelwright identified four separate categories of projects.Which of the following are not one of those categories?

Firms usually have two or more projects and this collection of projects is referred to as __________.

Which of the following is a type of numeric model?

In a project portfolio,a project that involves a new technology or even a disruptive technology that is known to the industry would serve as an example of a __________ project.

The underlying premise of the real options approach is that __________.

If a system is being updated due to operating necessity,the project was selected because__________.

There is usually some oversight committee,typically called a _____ or such,for every project,of which the project owner is usually a member.

__________ is the process of evaluating individual projects or groups of projects,and then choosing to implement some set of them so that the objectives of the parent organization will be achieved.

Contrast the real options selection approach with profitability models.

A project has four criteria,represented by A-D.There weights are 0.1,0.2,0.4,and 0.3.A particular project has scores of 4,5,8,and 9 respectively.What is its total score for the project?

Which of the following is not an advantage that favors the use of weighted scoring models?

If a company raises their hurdle rate,what happens to the net present value (NPV)of their projects?

Explain the difference between risk and uncertainty.

Real options seek to reduce which of the following risks in projects?

The __________ is the interest rate set by an organization as the minimum acceptable rate of return for a project.

Projects in Contemporary Organizations

The Project Manager

Managing Conflict and the Art of Negotiation

The Project in the Organizational Structure

Activity Planning: Traditional and Agile

Budgeting and Risk Management

Scheduling

Resource Allocation

Monitoring and Information Systems

Project Control

Project Auditing

Project Closure and Benefits Realization

Filters