Question 1

Which of the following demonstrates the quality of realism required of a project selection model?

Accepted Answer

A) It does not require special interpretation,data that are difficult to acquire,or excessive personnel. 
B) It gives valid results within the range of conditions that the firm might experience. 
C) It reflects the multiple objectives of both the firm and its managers. 
D) It deals with situations both internal and external to the project. 
A) It does not require special interpretation,data that are difficult to acquire,or excessive personnel. 
B) It gives valid results within the range of conditions that the firm might experience. 
C) It reflects the multiple objectives of both the firm and its managers. 
D) It deals with situations both internal and external to the project.

Question 2

The __________is the value of an opportunity foregone.

Accepted Answer

A) real option 
B) profit 
C) opportunity cost 
D) revenue 
A) real option 
B) profit 
C) opportunity cost 
D) revenue

Question 3

When the decision maker's information is not complete,he / she will have to make a decision under conditions of __________.

Accepted Answer

A) proof 
B) uncertainty 
C) management 
D) risk mitigation 
A) proof 
B) uncertainty 
C) management 
D) risk mitigation

Question 4

The Åstebro study (2004)of R&D projects found that all the characteristics below were excellent predictors of project commercial success,except __________.

Accepted Answer

A) technological opportunity 
B) managerial support 
C) expected profitability 
D) development risk 
A) technological opportunity 
B) managerial support 
C) expected profitability 
D) development risk

Question 5

A small project has a cost of $12,000 to implement and is expected to have annual cash flows of $3,000.What is its payback period?

Accepted Answer

A) One year 
B) Two years 
C) Three years 
D) Four years 
A) One year 
B) Two years 
C) Three years 
D) Four years

Question 6

A project selected using the sacred cow model is likely to be maintained until successfully completed or until __________.

Accepted Answer

A) the project exceeds its budget 
B) the project falls behind schedule 
C) the boss recognizes the project as a failure and terminates it 
D) the project manager is terminated 
A) the project exceeds its budget 
B) the project falls behind schedule 
C) the boss recognizes the project as a failure and terminates it 
D) the project manager is terminated

Question 7

Which of the following is not a disadvantage of the discounted cash flow approach to project selection?

Accepted Answer

A) It cannot account for project risk 
B) It ignores all nonmonetary factors 
C) It is strongly biased toward short-term solutions 
D) It is highly sensitive to data errors in the early years of a project 
A) It cannot account for project risk 
B) It ignores all nonmonetary factors 
C) It is strongly biased toward short-term solutions 
D) It is highly sensitive to data errors in the early years of a project

Question 8

Which of the following is not an advantage of the discounted cash flow approach to project selection?

Accepted Answer

A) Simple to use and understand 
B) The accounting data is usually available 
C) The accounting data is possibly inaccurate 
D) They can be adjusted to account for project risk 
A) Simple to use and understand 
B) The accounting data is usually available 
C) The accounting data is possibly inaccurate 
D) They can be adjusted to account for project risk

Question 9

If a company predicted rate of inflation goes down (deflation),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 10

Occasionally,organizations will approve projects that are forecast to lose money when fully costed and sometimes even when only direct costed.Which of the following is not a good reason for doing this.

Accepted Answer

A) Acquire knowledge concerning a specific or new technology 
B) Get the organization's "foot in the door" 
C) Improve their competitive position 
D) They plan on cutting corners on work and material,or forcing subsequent contract changes to make up the cost 
A) Acquire knowledge concerning a specific or new technology 
B) Get the organization's "foot in the door" 
C) Improve their competitive position 
D) They plan on cutting corners on work and material,or forcing subsequent contract changes to make up the cost

Question 11

For a project selected using nonnumeric models,identify the true statement regarding relative priorities for project selection.

Accepted Answer

A) Operating necessity projects have priority over competitive necessity projects. 
B) Competitive necessity projects have priority over operating necessity projects. 
C) Operating necessity and competitive necessity projects have equal priority. 
D) Product line extension projects have priority over operating necessity projects. 
A) Operating necessity projects have priority over competitive necessity projects. 
B) Competitive necessity projects have priority over operating necessity projects. 
C) Operating necessity and competitive necessity projects have equal priority. 
D) Product line extension projects have priority over operating necessity projects.

Question 12

______ is a modeling technique for emulating a process,usually conducted a considerable number of times to understand the process better and measure its outcomes under different policies.

Accepted Answer

A) Simulation 
B) Project management 
C) Projectizing 
D) Modeling 
A) Simulation 
B) Project management 
C) Projectizing 
D) Modeling

Question 13

Scoring models are most often used to overcome this disadvantage of profitability models.

Accepted Answer

A) The inability to account for the time value of money. 
B) The inability to account for project results beyond the payback period. 
C) The inability to account for multiple decision criteria. 
D) The inability to account for cash flow. 
A) The inability to account for the time value of money. 
B) The inability to account for project results beyond the payback period. 
C) The inability to account for multiple decision criteria. 
D) The inability to account for cash flow.

Question 14

Project Typhoon has a net present value of $10,000 and a profitability index of 1.01.Project Cyclone has a net present value of $10,000 and a profitability index of 1.10.Project Surf'sUp has a net present value of $10,000 and a profitability index of 1.05.If only one project could be undertaken,the organization should select __________.

Accepted Answer

A) Project Typhoon 
B) Project Cyclone 
C) Project Surf'sUp 
D) Not enough information is provided 
A) Project Typhoon 
B) Project Cyclone 
C) Project Surf'sUp 
D) Not enough information is provided

Question 15

The discounted cash flow method determines the net present value of all cash flows by discounting them by the __________.

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

Question 16

Consider the following three-year projects A and B each with the same initial investment of $1000.You are presented with the following measures for the projects:
Project A: NPV $400; Payback 24 months
Project B: NPV $545; Payback 26 months
Which project would you choose and why?

Accepted Answer

Project B would be the better choice for

Question 17

A project selection criteria that focuses on how well new products would fit the firm's existing product line would be

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

Question 18

The mastery of the skills required to manage projects competently is referred to in the literature as __________.

Accepted Answer

A) project management conformance 
B) project management maturity 
C) project success 
D) project portfolio management 
A) project management conformance 
B) project management maturity 
C) project success 
D) project portfolio management

Question 19

In a project portfolio,__________ projects have objectives or deliverables that are only incrementally different in both product and process from existing offerings.

Accepted Answer

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

Question 20

Project Boulder has a payback period of 2.4 years,an NPV of $10,000,and a profitability index of 1.10.Project Flintstone has a payback period of 3.0 years,an NPV of $10,000 and a profitability index of 1.05.If only one project can be executed,which project should be selected? Explain your reasoning.

Accepted Answer

Based on the available data,Pr

Which of the following demonstrates the quality of realism required of a project selection model?

The __________is the value of an opportunity foregone.

When the decision maker's information is not complete,he / she will have to make a decision under conditions of __________.

The Åstebro study (2004)of R&D projects found that all the characteristics below were excellent predictors of project commercial success,except __________.

A small project has a cost of $12,000 to implement and is expected to have annual cash flows of $3,000.What is its payback period?

A project selected using the sacred cow model is likely to be maintained until successfully completed or until __________.

Which of the following is not a disadvantage of the discounted cash flow approach to project selection?

Which of the following is not an advantage of the discounted cash flow approach to project selection?

If a company predicted rate of inflation goes down (deflation),what happens to the net present value (NPV)of their projects?

Occasionally,organizations will approve projects that are forecast to lose money when fully costed and sometimes even when only direct costed.Which of the following is not a good reason for doing this.

For a project selected using nonnumeric models,identify the true statement regarding relative priorities for project selection.

______ is a modeling technique for emulating a process,usually conducted a considerable number of times to understand the process better and measure its outcomes under different policies.

Scoring models are most often used to overcome this disadvantage of profitability models.

The discounted cash flow method determines the net present value of all cash flows by discounting them by the __________.

Consider the following three-year projects A and B each with the same initial investment of $1000.You are presented with the following measures for the projects: Project A: NPV $400; Payback 24 months Project B: NPV $545; Payback 26 months Which project would you choose and why?

A project selection criteria that focuses on how well new products would fit the firm's existing product line would be

The mastery of the skills required to manage projects competently is referred to in the literature as __________.

In a project portfolio,__________ projects have objectives or deliverables that are only incrementally different in both product and process from existing offerings.

Project Boulder has a payback period of 2.4 years,an NPV of $10,000,and a profitability index of 1.10.Project Flintstone has a payback period of 3.0 years,an NPV of $10,000 and a profitability index of 1.05.If only one project can be executed,which project should be selected? Explain your reasoning.

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

Which of the following demonstrates the quality of realism required of a project selection model?

The __________is the value of an opportunity foregone.

When the decision maker's information is not complete,he / she will have to make a decision under conditions of __________.

The Åstebro study (2004)of R&D projects found that all the characteristics below were excellent predictors of project commercial success,except __________.

A small project has a cost of $12,000 to implement and is expected to have annual cash flows of $3,000.What is its payback period?

A project selected using the sacred cow model is likely to be maintained until successfully completed or until __________.

Which of the following is not a disadvantage of the discounted cash flow approach to project selection?

Which of the following is not an advantage of the discounted cash flow approach to project selection?

If a company predicted rate of inflation goes down (deflation),what happens to the net present value (NPV)of their projects?

Occasionally,organizations will approve projects that are forecast to lose money when fully costed and sometimes even when only direct costed.Which of the following is not a good reason for doing this.

For a project selected using nonnumeric models,identify the true statement regarding relative priorities for project selection.

______ is a modeling technique for emulating a process,usually conducted a considerable number of times to understand the process better and measure its outcomes under different policies.

Scoring models are most often used to overcome this disadvantage of profitability models.

The discounted cash flow method determines the net present value of all cash flows by discounting them by the __________.

Consider the following three-year projects A and B each with the same initial investment of $1000.You are presented with the following measures for the projects: Project A: NPV $400; Payback 24 months Project B: NPV $545; Payback 26 months Which project would you choose and why?

A project selection criteria that focuses on how well new products would fit the firm's existing product line would be

The mastery of the skills required to manage projects competently is referred to in the literature as __________.

In a project portfolio,__________ projects have objectives or deliverables that are only incrementally different in both product and process from existing offerings.

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