Exam 2: Strategic Management and Project Selection

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

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 __________.

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

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

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?

The __________ is also called the benefit-cost ratio.

Which of the following is not a numeric scoring model?

Financial forecasts are reported as __________ financial statements.

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?

According to research by Sanchez and Robert (2010),which of the following is not a reason why strategic benefits may be difficult to appraise?

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

Which of the following demonstrates the quality of flexibility required of a project selection 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 discounted cash flow method determines the net present value of all cash flows by discounting them by the __________.

The sophistication and experience of an organization in managing multiple projects is called ________.

The typical project proposal should include all of the following,EXCEPT a(n)__________.

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

The set of documents submitted when evaluating a project is referred to as the __________.

Contrast the real options selection approach with profitability models.

The two basic types of project selection models identified in the text are ________.