Project Management Professional PMI Questions + Answers Part 15
Posted: Thu Mar 03, 2022 10:37 am
QUESTION 1397
The process of conferring with others to come to terms or reach an agreement is called______________
A. Win-win
B. Negotiation
C. Getting to "yes" D. Confrontation
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Negotiation if done well increases the probability of project success and involves conferring with others of shared or opposed interests with a view toward compromise. Negotiating is required to achieve mutually acceptable agreements between parties.
QUESTION 1398
The issue log is useful in control communications because it______________
A. Provides what has happened and is a platform for subsequent communications B. Includes the project's risk register
C. Organizes and summarizes information gathered
D. Serves as an information management system for communications management
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The issue log is an input to control communications and is used to document and monitor issue resolution. It can facilitate communications and ensure a common understanding of issues. In this process its information provides a repository of what already has happened in the project and serves as a platform for subsequent communications to be delivered. PMI®, PMBOK® Guide, 2013, 305
QUESTION 1399
As head of the PMO, you will receive performance reports for all major projects. You decided to set a guideline for project managers as performance reporting should______________
A. Collect work performance information on the status of deliverables
B. Provide earned value data for project forecasting
C. Provide information at an appropriate level for each audience
D. Focus on cost and schedule variances rather than scope, resources, quality, and risks
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Performance reporting is a tool and technique in manage communications. Performance reports range from simple status reports to more elaborate reports. The emphasis is to ensure performance reporting provides the needed information for each audience level.
QUESTION 1400
A simple performance report provides information on______________
A. Percent complete
B. Customer satisfaction
C. Unacceptable variances D. Scope creep
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
A simple status report may show performance information such as percent complete or status information for each area (scope, schedule, cost, and quality).
QUESTION 1401
In person-to-person communication, messages are sent on verbal levels and nonverbal levels simultaneously. As a general rule, what percentage of the message actually is sent through nonverbal cues?
A. 5 percent to 15 percent B. 20 percent to 30 percent C. 40 percent to 50 percent D. Greater than 50 percent
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Nonverbal cues can be divided into four categories: physical, aesthetic, signs, and symbols. Many studies have demonstrated that most messages are conveyed through such nonverbal cues as facial expression, touch, and body motion, rather than through the words spoken.
QUESTION 1402
As an output from control communications, it may be necessary to update the______________
A. Project schedule
B. Forecasts
C. Corporate policies, procedures, and processes D. Knowledge management system
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Communications control often entails the need to update project documents, including forecasts, performance reports, and the issue log.
QUESTION 1403
In project communications, the first step in a written communication is to______________
A. Analyze the facts and assumptions that have a bearing on the purpose of the message B. Gather thoughts or ideas
C. Develop a logical sequence of the topics to be addressed
D. Establish the basic purpose of the message
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
For any type of communication, the first step in the basic communication model is to encode, which means the sender translates thoughts or ideas into language.
QUESTION 1404
Your organization has decided to use project management for all of its endeavors. It has established a Center of Excellence for Project Management to support the movement into management by projects and has appointed you as its director. Since you work in a matrix environment, which of the following types of communications is the most essential for success?
A. Upward
B. Horizontal C. Downward D. Diagonal
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Horizontal communication is between the project manager and his or her peers and will be where most of the communications will occur. Accordingly, it is essential for success in a highly competitive environment and requires diplomacy, experience, and mutual respect.
QUESTION 1405
You have heard recently that the client calls your progress reports the "Code of Hammurabi" because they seem to be written in hieroglyphics and are completely indecipherable to all but an antiquities scholar. This situation could have been avoided by______________
A. Informing the client at the start of the project about the types of reports they will receive B. Using risk management techniques to identify client issues
C. Hiring an expert report writer to prepare standard reports
D. Engaging in communications planning
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The communications management plan is prepared during plan communications management.
The plan should include a description of the information to be distributed such as format, content, level of detail, as well as conventions and definitions to be used.
QUESTION 1406
Assume on your project you have identified 250 stakeholders located in three continents and of these 250, you have determined that 200 of them will be actively involved and interested in your project. Therefore, as you determine an appropriate communication method, your best approach is______________
A. Elaborate status reports B. Simple status reports C. Knowledge repositories D. E-mails
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Knowledge repositories along with Intranet sites, e-learning, and lessons learned data bases are examples of methods of pull communications. They are used for large volumes of information or for large audiences and require recipients to access communication content at their own discretion.
QUESTION 1407
You want to ensure that the information you collect showing project progress and status is meaningful to stakeholders. You want to combine the type and format of the stakeholder's information needs with an analysis of the value of the information. You will document this information in the______________
A. Communications register
B. Stakeholder register
C. Stakeholder management plan
D. Communications management plan
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The project team must conduct an analysis of stakeholder communications requirements to ensure that stakeholders are receiving the information required to participate in the project. For example, stakeholders typically require performance reports for information purposes. Such information requirements should be included in the communications management plan.
QUESTION 1408
Work performance information is an output of which process?
A. Manage risks
B. Manage communications C. Control communications D. Report performance
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Work performance information, an output of control communications, organizes and summaries performance data such as status and progress information on the project at the level required by stakeholders. This information next is communicated to the appropriate stakeholders.
QUESTION 1409
Assume you want to optimize the work performance reports you will use to manage communications. You should do so by______________
A. Determining the most appropriate choice of communications media
B. Setting different communications techniques for different stakeholder groups C. Ensuring the information is consistent with regulations and standards
D. Ensuring comprehensiveness, accuracy, and availability
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Work performance reports are an input to manage communications. They are a collection of project performance and status information used to facilitate discussion and create communications. They should be comprehensive, accurate, and available in a timely way.
QUESTION 1410
General management skills relevant to the manage communications process include______________
A. Operational planning
B. Organizational behavior
C. Setting and managing expectations D. Influencing the organization
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Communications skills are part of general management skills, and setting and managing expectations are an example in manage communications. This helps create, collect, distribute, store, retrieve, and ultimately dispose of project information according to the communications management plan.
QUESTION 1411
One way to determine how to best update and communicate project performance and respond to stakeholder information requests is to______________
A. Review the effectiveness of the communications management plan B. Set up a portal
C. Hold meetings
D. Distribute performance reports
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Meetings are a tool and technique in control communications. They can be face to face or online and in different locations and may include not only the project team but also suppliers, vendors, and other stakeholders.
QUESTION 1412
The purpose of work performance data in control communications is to present results of comparative analysis to the______________
A. Performance measurement baseline B. Communications management plan C. Stakeholder management plan
D. Deliverable status
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Wok performance data are an input in control communications. These data organize and summarize information gathered and present the results of comparative analysis to the performance measurement baseline.
QUESTION 1413
Because communications planning often is linked tightly with enterprise environmental factors, which one of the following statements is true?
A. The project's organizational structure has a major effect on the project's communications requirements.
B. Standardized guidelines, work instructions, and performance measurement criteria are key items to consider.
C. Procedures for approving and issuing work authorizations should be taken into consideration.
D. Criteria and guidelines to tailor standard processes to the specific needs of the project should be stated explicitly.
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Enterprise environmental factors undoubtedly will influence the project's success and must be considered because communication must be adapted to the project environment.
QUESTION 1414
You are working on a project with 15 stakeholders. The number of communication channels on this project is______________
A. 15 B. 105 C. 210 D. 225
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The formula for determining the number of communication channels is n(n - 1)/2, where n = the number of stakeholders: 15(15 - 1)/2 = (15)(14)/2 = 105. It is important to note that project managers must plan the project's communications requirements carefully, limiting who will communicate with whom given the potential for confusion when multiple communications channels can exist.
QUESTION 1415
Which of the following formulas calculates the number of communication channels in a project?
A. B. C. D.
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Where n = the number of stakeholders.
QUESTION 1416
A risk response strategy that can be used for both threats and opportunities is______________ A. Share
B. Avoid C. Accept D. Transfer
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Risk exists on every project, and it is unrealistic to think it can be eliminated completely. There are certain risks that simply must be accepted because we cannot control whether or not they will occur (for example, an earthquake). Acceptance is a strategy for dealing with risk that can be used for both threats and opportunities.
QUESTION 1417
Projects are particularly susceptible to risk because______________
A. Murphy's law states that "if something can go wrong, it will"
B. There is uncertainty in all projects
C. Project management tools are generally unavailable at the project team level D. There are never enough resources to do the job
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Every project has uncertainty associated with it because a project by its definition is a temporary endeavor undertaken to create a unique product, service, or result. Risks may be known or unknown.
QUESTION 1418
You are working on identifying possible risks to your project to develop a nutritional supplement. You want to develop a comprehensive list of risks that can be addressed later through qualitative and quantitative risk analysis. An information gathering technique used to identify risks is______________
A. Documentation reviews
B. Probability and impact analysis C. Checklist analysis
D. Brainstorming
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Brainstorming is a frequently used information-gathering technique for identifying risk, because it enables the project team to develop a list of potential risks relatively quickly. Project team members, or invited experts, participate in the session. Risks are easily categorized for follow-on analysis.
QUESTION 1419
The Delphi technique is a particularly useful method for identifying risks to______________
A. Present a sequence of decision choices graphically to decision makers
B. Define the probability of occurrence of specific variables
C. Reduce bias in the analysis and keep any one person from having undue influence on the outcome D. Help take into account the attitude of the decision maker toward risk
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The Delphi technique provides a means for arriving at a consensus using a panel of experts to determine a solution to a specific problem. Project risk experts are identified but participate anonymously. Each pane list answers a questionnaire. Then the responses, along with opinions and justifications, are evaluated, and statistical feedback is given to each panel member. The process continues until group responses converge toward a solution.
QUESTION 1420
A workaround is______________
A. An unplanned response to a negative risk event
B. A plan of action to follow when something unexpected occurs
C. A specific response to certain types of risk as described in the risk management plan D. A proactive, planned method of responding to risks
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Used in control risks, a workaround is a response to a threat that has occurred for which a prior response had not been planned or was not effective.
QUESTION 1421
Most statistical simulations of budgets, schedules, and resource allocations use which one of the following approaches?
A. PERT
B. Decision-tree analysis C. Present value analysis D. Monte Carlo analysis
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Simulations are typically performed using Monte Carlo in which a project model is computed many times with the input values chosen at random for each iteration from the probability distribution of these variables. Monte Carlo analysis supports various statistical distributions (normal, triangular, beta, uniform, etc.) used in estimating budgets, schedules, and resource allocations.
QUESTION 1422
In the below path convergence example, if the odds of completing activities 1, 2, and 3 on time are 50 percent, 50 percent, and 50 percent, what are the chances of starting activity 4 on day 6?
A. 10 percent B. 13 percent C. 40 percent D. 50 percent
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Probability (starting activity 4 on day 6)=(0.5)3 =0.125 or 13%
QUESTION 1423
A project health check identified a risk that your project would not be completed on time. As a result, you are quantifying the project's risk exposure and determining what cost and schedule contingency reserves might be needed. You performed a schedule risk analysis using Monte Carlo analysis. The basis for your schedule risk analysis is the______________
A. WBS
B. Gantt chart
C. Schedule network diagram and duration estimates D. Probability/impact risk rating matrix
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
When determining the likelihood of meeting the project's schedule end date through Monte Carlo, the schedule network diagram and duration estimate are used as inputs to the simulation program. Cost risk, on the other hand, uses cost estimates from the WBS.
QUESTION 1424
Your project team has identified all the risks on the project and has categorized them as high, medium, and low. The "low" risks are placed on which one of the following for monitoring?
A. Threat list B. Low risk list
C. Watch list
D. Low impact list
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Even low-priority risks must be monitored. A watch list is used to ensure such risks are tracked for continued monitoring.
QUESTION 1425
A recent earned value analysis shows that your project is 20 percent complete, the CPI is 0.67, and the SPI is 0.87. In this situation, you should______________
A. Perform additional resource planning, add resources, and use overtime as needed to accomplish the same amount of budgeted work B. Rebaseline the schedule, then use Monte Carlo analysis
C. Conduct a risk response audit to help control risk
D. Forecast potential deviation of the project at completion from cost and schedule targets
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Earned value is used for monitoring overall project performance against a baseline plan. It is a part of variance analysis, a tool and technique in control risks.
QUESTION 1426
The purpose of a numeric scale in risk management is to______________
A. Avoid high-impact risks
B. Assign a relative value to the impact on project objectives if the risk in question occurs C. Rank order risks in terms of very low, low, moderate, high, and very high
D. Test project assumptions
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
You can develop relative or numeric, well-defined scales using agreed-upon definitions by the stakeholders. When using a numeric scale, each level of impact has a specific number assigned to it.
QUESTION 1427
When managing current projects, it is important to use lessons learned from previous projects to improve the organization's project management process. Therefore, in project closing procedures, it is important to review the______________
A. Secondary risks that occurred B. Checklists for identify risks
C. WBS dictionary
D. Fallback plan
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Checklists are a tool and a technique of the identify risks process and include risks encountered on similar, previous projects identified through the lessons learned process and from other sources. The project team should review the checklist as part of the identify risks process as well as during closeout. The team should add to the list as necessary, based on its experience, to help others in the future.
QUESTION 1428
On a typical project, when are risks highest and impacts (amount at stake) lowest?
A. During the concept phase
B. At or near completion of the project
C. During the implementation phase
D. When the project manager is replaced
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Risks are highest at the beginning of a project because the project faces an uncertain future, and impacts are lowest at this time because investments in human and material resources are minimal.
QUESTION 1429
Two key inputs to the perform quantitative risk analysis process are the______________
A. WBS and milestone list
B. Scope management plan and process improvement plan C. Schedule management plan and cost management plan D. Procurement management plan and quality baseline
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The cost and schedule of a project are two areas significantly affected by risk occurrences. Information on these two areas, because of their quantitative nature, provides excellent input to the perform quantification risk process to help determine overall impact and to provide guidelines as managing risk reserves.
QUESTION 1430
The highest risk impact generally occurs during which one of the following project life-cycle phases?
A. Concept and planning
B. Planning and implementation C. Implementation and closeout D. Concept and closeout
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Opportunity and risk generally remain high during the concept and planning phases. However, the amount at stake remains low because of the relatively low level of investment up to that point. During project implementation and closeout, however, risk falls to lower levels as remaining unknowns are translated into knowns. At the same time, the amount at stake rises steadily as the necessary resources are invested to complete the project.
QUESTION 1431
Which one of the following statements best characterizes an activity cost or duration estimate developed with a limited amount of information? A. It should be part of the planning for the needed management reserve.
B. It is an input to identify risks.
C. It is an output from identify risks.
D. It must be factored into the list of prioritized project risks.
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Much of the output from planning in other knowledge areas, such as activity cost and duration estimates, may entail risk and is reviewed during the identify risks process. This process requires an understanding of the schedule, cost, and quality management plans found in the project management plan. Estimates that are aggressive or developed with a limited amount of information are even more likely to entail risk and, therefore, must also be an input to the identify risks process.
QUESTION 1432
What is the primary difference between a risk audit and a risk reassessment?
A. A risk reassessment is conducted at the completion of a major phase; audits are conducted after the project is complete. B. Project stakeholders conduct risk audits; management conducts reassessments.
C. Risk reassessments are regularly scheduled; risk audits are performed as defined in the project's risk management plan. D. There is no difference; they are virtually the same.
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Risk reassessment is an ongoing activity by the project team. Risks should be discussed at every status meeting. Risk audits are performed during the project life cycle to examine and document the effectiveness of risk responses. They are conducted at appropriate frequencies as defined in the risk management plan.
QUESTION 1433
Accurate and unbiased data are essential for perform qualitative risk analysis. Which one of the following should you use to examine the extent of understanding of project risk?
A. Data quality assessment
B. Project assumptions testing C. Sensitivity analysis
D. Influence diagrams
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Perform qualitative risk analysis requires accurate and unbiased data. The use of low-quality data may result in a qualitative risk analysis that is of little use to the project manager regarding understanding of the risk, data available about the risk, data quality, and data reliability and integrity.
QUESTION 1434
Contingency planning involves______________
A. Defining the steps to be taken if an identified risk event should occur
B. Establishing a management reserve to cover unplanned expenditures
C. Preparing a stand-alone document that is separate from the overall project plan
D. Determining needed adjustments to make during the implementation phase of a project
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
For some risks it is appropriate for the project team to make a response plan that will be executed only under certain predefined conditions if it is believed that there will be sufficient warning to implement the plan.
QUESTION 1435
Assume that you are working on a new product for your firm. Your CEO learned that a competitor was about to launch a new product that has similar features to those of your project. The competitor plans to launch the product on September 1. It is now March 1. Your schedule called for you to launch your product on December 1. Your CEO now has now mandated that you fast track your project so you can launch your product on August 1. This fast track schedule is an example of an______________
A. Unknown risk
B. A risk taken to achieve a reward
C. A response that requires sharing the risk D. A passive avoidance strategy
Correct Answer: B Section: Mix Questions
Explanation
Explanation/Reference:
Explanation:
Project risk has its origin in the uncertainty that is present in all projects. Organizations and stakeholders are willing to accept varying degrees of risk, and risks that are threats to the project may be accepted if the risks are within tolerances and are in balance with the rewards to be gained. This example of adopting a fast-track schedule is a risk taken to achieve the reward created by the earlier completion date.
QUESTION 1436
As head of the project management office, you need to focus on those items where risk responses can lead to better project outcomes. One way to help you make these decisions is to______________
A. Use a probability and impact matrix
B. Assess trends in perform quantitative risk analysis results C. Prioritize risks and conditions
D. Assess trends in perform qualitative risk analysis results
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The probability and impact matrix can be used to classify risks according to their level of impact and to prioritize them for future quantitative analyses and responses based on their rating. Typically these risk rating rules are specified by the organization in advance of the project. The matrix specifies combinations of probability and impact that lead to rating the risks as low, moderate, or high priority.
QUESTION 1437
What doctrine causes a party to relinquish rights under a contract because it knowingly fails to execute those rights?
A. Assignment of claims B. Material breach
C. Waiver
D. Warranties
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Under the doctrine of waiver, a party can relinquish rights that it otherwise has under the contract. If the seller offers incomplete, defective, or late performance, and the buyer's project manager knowingly accepts that performance, the buyer has waived its right to strict performance. In some circumstances, the party at fault may remain liable for provable damages, but the waiver will prevent the buyer from claiming a material breach and, thus, from terminating the contract.
QUESTION 1438
Which term describes those costs in a contract that are associated with two or more projects but are not traceable to either of them individually?
A. Variable
B. Direct
C. Indirect
D. Semivariable
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The nature of an indirect cost is such that it is neither possible nor practical to measure how much of the cost is attributable to a single project. These costs are allocated to the project by the performing organization as a cost of doing business.
QUESTION 1439
Contract type selection is dependent on the degree of risk or uncertainty facing the project manager. From the perspective of the buyer, the preferred contract type in a low-risk situation is______________
A. Firm-fixed-price
B. Fixed-price-incentive
C. Cost-plus-fixed fee
D. Cost-plus-a-percentage-of-cost
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Buyers prefer the firm-fixed-price contract because it places more risk on the seller. Although the seller bears the greatest degree of risk, it also has the maximum potential for profit. Because the seller receives an agreed-upon amount regardless of its costs, it is motivated to decrease costs by efficient production.
QUESTION 1440
Which term describes the failure by either the buyer or the seller to perform part or all of the duties of a contract?
A. Termination of contract B. Partial performance
C. Breach of contract
D. Contract waiver
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
A breach of contract is a failure to perform either express or implied duties of the contract. Either the buyer or the seller can be responsible for a breach of contract.
QUESTION 1441
Significant differences between the seller's price and your independent estimate may indicate all the following EXCEPT the______________
A. SOW was not adequate
B. Seller misunderstood the SOW
C. Sellers failed to respond
D. Project team chose the wrong contract type
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The contract type is typically dictated by the procurement SOW and chosen by the contracting officer. Independent estimates are a tool and technique in conduct procurements.
QUESTION 1442
When a seller breaches a contract, the buyer cannot receive______________
A. Compensatory damages B. Punitive damages
C. Liquidated damages
D. Consequential damages
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Punitive damages are designed to punish a guilty party and, as such, are considered penalties. Because a breach of contract is not unlawful, punitive damages are not awarded. The other remedies listed are available to compensate the buyer's loss.
QUESTION 1443
Because you are working under a firm-fixed-price contract, management wants you to submit the final invoice and close out the contract as soon as possible. Before final payment on the contract can be authorized, you must______________
A. Prepare a contract completion statement B. Audit the procurement process
C. Update and archive contract records
D. Settle subcontracts
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
All payments due must be settled by the seller before the contract can be officially closed. The other items listed are activities performed by the buyer.
QUESTION 1444
As you prepare to close out contracts on your project, you should review all the following types of documentation EXCEPT the______________
A. Contract document for the contract being closed B. Procurement audit report
C. Invoice and payment records
D. Seller performance reports
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
In most organizations, a procurement audit is conducted after the contract has been closed. Therefore, the project manager would not have a procurement audit report to review. Contract document for the contract being closed, invoice and payment records, and seller performance reports are examples of the documents that should be available to the project manager and should be reviewed at closeout.
QUESTION 1445
Your company decided to award a contract for project management services on a pharmaceutical research project. Because your company is new to project management and does not understand the full scope of services that may be needed under the contract, it is most appropriate to award a______________
A. Firm-fixed-price contract
B. Fixed-price-incentive contract
C. Cost-plus-a-percentage-of-cost contract D. Time-and-materials contract
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
A time-and-materials contract is a type of contract that provides for the acquisition of supplies or services on the basis of direct labor hours, at specified fixed hourly rates for wages, overhead, general and administrative expenses, and profit; and materials at cost, including materials-handling costs.
QUESTION 1446
Requirements for formal contract acceptance and closure usually are defined in the______________
A. Proposal
B. Statement of work
C. Contract terms and conditions D. Procurement audit report
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The contract terms and conditions typically describe the procedure the buyer will employ to close the contract.
QUESTION 1447
You plan to award a contract to provide project management training for your company. You decide it is important that any prospective contractor have an association with a major university that awards master's certificates in project management. This is an example of______________
A. Setting up an independent evaluation
B. Preparing requirements for your statement of work C. Establishing a weighting system
D. Establishing source selection criteria
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The selection criteria are typically included in procurement documents and are then used to rate or score proposals.
QUESTION 1448
All the following elements must be evident in a written contract for it to be legally enforceable EXCEPT______________
A. Legal capacity B. Mutual assent C. Appropriate form D. Pricing structure
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The following elements must be present for a contract to be legally enforceable: legal capacity, mutual assent, consideration, legality, and an appropriate contract form that follows applicable laws governing businesses.
QUESTION 1449
A purchase order is a good example of which form of contracting?
A. Unilateral B. Bilateral
C. Trilateral D. Severable
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The purchase order is a unilateral (one signature) offer that includes a promise to pay upon delivery.
QUESTION 1450
The primary benefit of contract control procurements is to ensure that______________
A. Buyers conduct performance reviews
B. Payment is made in a timely fashion
C. Disagreements are handled quickly and to everyone's satisfaction
D. Both parties meet contractual obligations and protect their legal rights
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Contracts are awarded to obtain goods and services in accordance with the buyer's stated requirements. Although there are multiple purposes in the control procurements process, ensuring that the seller delivers what is stated in the contract is of paramount importance.
QUESTION 1451
The principal function of a warranty is to______________
A. Provide assurance of the level of quality to be provided
B. Provide a way to assert claims for late payment
C. Provide a way to allow additional time following acceptance to correct deficiencies, without additional costs D. Ensure that goods purchased fit the purposes for which they are to be used
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
A warranty is one party's assurance to the other that goods will meet certain standards of quality, including condition, reliability, description, function, or performance. This assurance may be express or implied.
QUESTION 1452
As project manager, you need a relatively fast and informal method addressing disagreements with contractors. One such method is to submit the issue in question to an impartial third party for resolution. This process is known as______________
A. Alternative dispute resolution B. Problem processing
C. Steering resolution
D. Mediation litigation
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Alternative dispute resolution, or dispute resolution, is a relatively informal way to address differences of opinion on contracts. Its purpose is to address such issues without having to seek formal legal redress through the courts.
QUESTION 1453
A no-cost settlement sometimes is used______________
A. To close out a successful contract
B. In lieu of formal termination procedures
C. When buyer property has been furnished under the contract
D. When such an arrangement is acceptable to one of the parties involved
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
A no-cost settlement can be used in lieu of formal termination procedures when the seller has indicated that such an arrangement is acceptable, no buyer property has been furnished under the contract, no payments are due the seller, no other obligations are outstanding, and the product or service can be readily obtained elsewhere.
QUESTION 1454
When writing payment terms in your fixed-price subcontracts it is especially important to______________
A. Include incentives if the seller exceeds or fails below defined objectives
B. Provide flexibility to redirect the seller if the scope of work is not defined precisely confusion C. Link progress made to compensation paid
D. Associate the payment to a specific time period for more efficient accounting
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
A buyer under a fixed-price contract should pay a seller for work delivered rather than time expended. Linking payment with progress ensures that the seller will focus on results and not on effort expended.
QUESTION 1455
Requirements for formal deliverable acceptance are defined in the______________
A. Contract
B. Procurement management plan C. Overall project management plan D. Specifications
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Two important components of any contract include what the buyer wants to buy and how the buyer defines acceptance of the products or services delivered. For contract closure to occur, deliverable acceptance must be completed.
QUESTION 1456
Payment bonds are often required by the contract and require specific actions under the stated conditions. Payment bonds are specifically designed to ensure that the prime contractor provides payment of______________
A. Insurance premiums
B. Weekly payrolls
C. Subcontractors, laborers, and sellers of material D. Damages for accidents caused
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Payment bonds, which are required by the buyer, are issued by guarantors to prime contractors. The buyer wants to ensure that subcontractors of the prime contractor receive payment so that work is not disrupted.
QUESTION 1457
The best approach to resolve the settlement of all outstanding contract changes, claims, and disputes is using______________
A. Litigation
B. Alternative dispute resolution C. Negotiation
D. Mediation
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
While there are a variety of ways to settle claims, disputes, and changes, the preferred approach is negotiation. It is a strategy to work toward compromise or to reach an agreement that both parties can accept.
QUESTION 1458
During contract negotiations on large contracts, the negotiation process focuses on many key issues, with price being one of them. Separate negotiations can be made on price, quantity, quality, and timing, which can significantly lengthen the process. The negotiation process can be shortened, however, provided that______________
A. Planning is done for negotiations
B. Expertise of the project management staff in the procurement process is at a high level C. A request for proposal is used rather than a request for quotation
D. There is integrity in the relationship and prior history with the vendor
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
When people know and trust one another, and in particular have worked with each other before, the negotiation process can be significantly shortened. Three major factors of negotiation should be followed: compromise ability, adaptability, and good faith.
QUESTION 1459
Contract negotiations are NOT required when______________
A. A company uses sealed bids
B. There is a sole source procurement C. A competitive range is established D. A two-step process is used
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
When using the sealed bid method, competitive market forces determine the price, and the award goes to the lowest bidder, provided all other terms and conditions of the contract are met.
QUESTION 1460
It is critical during the proposal preparation stage that______________
A. The negotiation strategy is determined
B. A change management strategy is developed
C. Roles and responsibilities for the ultimate project are determined
D. Contract terms and conditions are reviewed before the proposal is submitted to the client
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The contracts (legal) representative is responsible for the preparation of the contract portion of the proposal. Generally, contracts with the legal department are handed through or in coordination with the proposal group. Before the proposal is submitted to the client, contract terms and conditions should be reviewed and approved.
The process of conferring with others to come to terms or reach an agreement is called______________
A. Win-win
B. Negotiation
C. Getting to "yes" D. Confrontation
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Negotiation if done well increases the probability of project success and involves conferring with others of shared or opposed interests with a view toward compromise. Negotiating is required to achieve mutually acceptable agreements between parties.
QUESTION 1398
The issue log is useful in control communications because it______________
A. Provides what has happened and is a platform for subsequent communications B. Includes the project's risk register
C. Organizes and summarizes information gathered
D. Serves as an information management system for communications management
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The issue log is an input to control communications and is used to document and monitor issue resolution. It can facilitate communications and ensure a common understanding of issues. In this process its information provides a repository of what already has happened in the project and serves as a platform for subsequent communications to be delivered. PMI®, PMBOK® Guide, 2013, 305
QUESTION 1399
As head of the PMO, you will receive performance reports for all major projects. You decided to set a guideline for project managers as performance reporting should______________
A. Collect work performance information on the status of deliverables
B. Provide earned value data for project forecasting
C. Provide information at an appropriate level for each audience
D. Focus on cost and schedule variances rather than scope, resources, quality, and risks
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Performance reporting is a tool and technique in manage communications. Performance reports range from simple status reports to more elaborate reports. The emphasis is to ensure performance reporting provides the needed information for each audience level.
QUESTION 1400
A simple performance report provides information on______________
A. Percent complete
B. Customer satisfaction
C. Unacceptable variances D. Scope creep
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
A simple status report may show performance information such as percent complete or status information for each area (scope, schedule, cost, and quality).
QUESTION 1401
In person-to-person communication, messages are sent on verbal levels and nonverbal levels simultaneously. As a general rule, what percentage of the message actually is sent through nonverbal cues?
A. 5 percent to 15 percent B. 20 percent to 30 percent C. 40 percent to 50 percent D. Greater than 50 percent
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Nonverbal cues can be divided into four categories: physical, aesthetic, signs, and symbols. Many studies have demonstrated that most messages are conveyed through such nonverbal cues as facial expression, touch, and body motion, rather than through the words spoken.
QUESTION 1402
As an output from control communications, it may be necessary to update the______________
A. Project schedule
B. Forecasts
C. Corporate policies, procedures, and processes D. Knowledge management system
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Communications control often entails the need to update project documents, including forecasts, performance reports, and the issue log.
QUESTION 1403
In project communications, the first step in a written communication is to______________
A. Analyze the facts and assumptions that have a bearing on the purpose of the message B. Gather thoughts or ideas
C. Develop a logical sequence of the topics to be addressed
D. Establish the basic purpose of the message
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
For any type of communication, the first step in the basic communication model is to encode, which means the sender translates thoughts or ideas into language.
QUESTION 1404
Your organization has decided to use project management for all of its endeavors. It has established a Center of Excellence for Project Management to support the movement into management by projects and has appointed you as its director. Since you work in a matrix environment, which of the following types of communications is the most essential for success?
A. Upward
B. Horizontal C. Downward D. Diagonal
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Horizontal communication is between the project manager and his or her peers and will be where most of the communications will occur. Accordingly, it is essential for success in a highly competitive environment and requires diplomacy, experience, and mutual respect.
QUESTION 1405
You have heard recently that the client calls your progress reports the "Code of Hammurabi" because they seem to be written in hieroglyphics and are completely indecipherable to all but an antiquities scholar. This situation could have been avoided by______________
A. Informing the client at the start of the project about the types of reports they will receive B. Using risk management techniques to identify client issues
C. Hiring an expert report writer to prepare standard reports
D. Engaging in communications planning
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The communications management plan is prepared during plan communications management.
The plan should include a description of the information to be distributed such as format, content, level of detail, as well as conventions and definitions to be used.
QUESTION 1406
Assume on your project you have identified 250 stakeholders located in three continents and of these 250, you have determined that 200 of them will be actively involved and interested in your project. Therefore, as you determine an appropriate communication method, your best approach is______________
A. Elaborate status reports B. Simple status reports C. Knowledge repositories D. E-mails
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Knowledge repositories along with Intranet sites, e-learning, and lessons learned data bases are examples of methods of pull communications. They are used for large volumes of information or for large audiences and require recipients to access communication content at their own discretion.
QUESTION 1407
You want to ensure that the information you collect showing project progress and status is meaningful to stakeholders. You want to combine the type and format of the stakeholder's information needs with an analysis of the value of the information. You will document this information in the______________
A. Communications register
B. Stakeholder register
C. Stakeholder management plan
D. Communications management plan
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The project team must conduct an analysis of stakeholder communications requirements to ensure that stakeholders are receiving the information required to participate in the project. For example, stakeholders typically require performance reports for information purposes. Such information requirements should be included in the communications management plan.
QUESTION 1408
Work performance information is an output of which process?
A. Manage risks
B. Manage communications C. Control communications D. Report performance
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Work performance information, an output of control communications, organizes and summaries performance data such as status and progress information on the project at the level required by stakeholders. This information next is communicated to the appropriate stakeholders.
QUESTION 1409
Assume you want to optimize the work performance reports you will use to manage communications. You should do so by______________
A. Determining the most appropriate choice of communications media
B. Setting different communications techniques for different stakeholder groups C. Ensuring the information is consistent with regulations and standards
D. Ensuring comprehensiveness, accuracy, and availability
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Work performance reports are an input to manage communications. They are a collection of project performance and status information used to facilitate discussion and create communications. They should be comprehensive, accurate, and available in a timely way.
QUESTION 1410
General management skills relevant to the manage communications process include______________
A. Operational planning
B. Organizational behavior
C. Setting and managing expectations D. Influencing the organization
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Communications skills are part of general management skills, and setting and managing expectations are an example in manage communications. This helps create, collect, distribute, store, retrieve, and ultimately dispose of project information according to the communications management plan.
QUESTION 1411
One way to determine how to best update and communicate project performance and respond to stakeholder information requests is to______________
A. Review the effectiveness of the communications management plan B. Set up a portal
C. Hold meetings
D. Distribute performance reports
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Meetings are a tool and technique in control communications. They can be face to face or online and in different locations and may include not only the project team but also suppliers, vendors, and other stakeholders.
QUESTION 1412
The purpose of work performance data in control communications is to present results of comparative analysis to the______________
A. Performance measurement baseline B. Communications management plan C. Stakeholder management plan
D. Deliverable status
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Wok performance data are an input in control communications. These data organize and summarize information gathered and present the results of comparative analysis to the performance measurement baseline.
QUESTION 1413
Because communications planning often is linked tightly with enterprise environmental factors, which one of the following statements is true?
A. The project's organizational structure has a major effect on the project's communications requirements.
B. Standardized guidelines, work instructions, and performance measurement criteria are key items to consider.
C. Procedures for approving and issuing work authorizations should be taken into consideration.
D. Criteria and guidelines to tailor standard processes to the specific needs of the project should be stated explicitly.
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Enterprise environmental factors undoubtedly will influence the project's success and must be considered because communication must be adapted to the project environment.
QUESTION 1414
You are working on a project with 15 stakeholders. The number of communication channels on this project is______________
A. 15 B. 105 C. 210 D. 225
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The formula for determining the number of communication channels is n(n - 1)/2, where n = the number of stakeholders: 15(15 - 1)/2 = (15)(14)/2 = 105. It is important to note that project managers must plan the project's communications requirements carefully, limiting who will communicate with whom given the potential for confusion when multiple communications channels can exist.
QUESTION 1415
Which of the following formulas calculates the number of communication channels in a project?
A. B. C. D.
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Where n = the number of stakeholders.
QUESTION 1416
A risk response strategy that can be used for both threats and opportunities is______________ A. Share
B. Avoid C. Accept D. Transfer
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Risk exists on every project, and it is unrealistic to think it can be eliminated completely. There are certain risks that simply must be accepted because we cannot control whether or not they will occur (for example, an earthquake). Acceptance is a strategy for dealing with risk that can be used for both threats and opportunities.
QUESTION 1417
Projects are particularly susceptible to risk because______________
A. Murphy's law states that "if something can go wrong, it will"
B. There is uncertainty in all projects
C. Project management tools are generally unavailable at the project team level D. There are never enough resources to do the job
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Every project has uncertainty associated with it because a project by its definition is a temporary endeavor undertaken to create a unique product, service, or result. Risks may be known or unknown.
QUESTION 1418
You are working on identifying possible risks to your project to develop a nutritional supplement. You want to develop a comprehensive list of risks that can be addressed later through qualitative and quantitative risk analysis. An information gathering technique used to identify risks is______________
A. Documentation reviews
B. Probability and impact analysis C. Checklist analysis
D. Brainstorming
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Brainstorming is a frequently used information-gathering technique for identifying risk, because it enables the project team to develop a list of potential risks relatively quickly. Project team members, or invited experts, participate in the session. Risks are easily categorized for follow-on analysis.
QUESTION 1419
The Delphi technique is a particularly useful method for identifying risks to______________
A. Present a sequence of decision choices graphically to decision makers
B. Define the probability of occurrence of specific variables
C. Reduce bias in the analysis and keep any one person from having undue influence on the outcome D. Help take into account the attitude of the decision maker toward risk
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The Delphi technique provides a means for arriving at a consensus using a panel of experts to determine a solution to a specific problem. Project risk experts are identified but participate anonymously. Each pane list answers a questionnaire. Then the responses, along with opinions and justifications, are evaluated, and statistical feedback is given to each panel member. The process continues until group responses converge toward a solution.
QUESTION 1420
A workaround is______________
A. An unplanned response to a negative risk event
B. A plan of action to follow when something unexpected occurs
C. A specific response to certain types of risk as described in the risk management plan D. A proactive, planned method of responding to risks
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Used in control risks, a workaround is a response to a threat that has occurred for which a prior response had not been planned or was not effective.
QUESTION 1421
Most statistical simulations of budgets, schedules, and resource allocations use which one of the following approaches?
A. PERT
B. Decision-tree analysis C. Present value analysis D. Monte Carlo analysis
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Simulations are typically performed using Monte Carlo in which a project model is computed many times with the input values chosen at random for each iteration from the probability distribution of these variables. Monte Carlo analysis supports various statistical distributions (normal, triangular, beta, uniform, etc.) used in estimating budgets, schedules, and resource allocations.
QUESTION 1422
In the below path convergence example, if the odds of completing activities 1, 2, and 3 on time are 50 percent, 50 percent, and 50 percent, what are the chances of starting activity 4 on day 6?
A. 10 percent B. 13 percent C. 40 percent D. 50 percent
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Probability (starting activity 4 on day 6)=(0.5)3 =0.125 or 13%
QUESTION 1423
A project health check identified a risk that your project would not be completed on time. As a result, you are quantifying the project's risk exposure and determining what cost and schedule contingency reserves might be needed. You performed a schedule risk analysis using Monte Carlo analysis. The basis for your schedule risk analysis is the______________
A. WBS
B. Gantt chart
C. Schedule network diagram and duration estimates D. Probability/impact risk rating matrix
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
When determining the likelihood of meeting the project's schedule end date through Monte Carlo, the schedule network diagram and duration estimate are used as inputs to the simulation program. Cost risk, on the other hand, uses cost estimates from the WBS.
QUESTION 1424
Your project team has identified all the risks on the project and has categorized them as high, medium, and low. The "low" risks are placed on which one of the following for monitoring?
A. Threat list B. Low risk list
C. Watch list
D. Low impact list
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Even low-priority risks must be monitored. A watch list is used to ensure such risks are tracked for continued monitoring.
QUESTION 1425
A recent earned value analysis shows that your project is 20 percent complete, the CPI is 0.67, and the SPI is 0.87. In this situation, you should______________
A. Perform additional resource planning, add resources, and use overtime as needed to accomplish the same amount of budgeted work B. Rebaseline the schedule, then use Monte Carlo analysis
C. Conduct a risk response audit to help control risk
D. Forecast potential deviation of the project at completion from cost and schedule targets
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Earned value is used for monitoring overall project performance against a baseline plan. It is a part of variance analysis, a tool and technique in control risks.
QUESTION 1426
The purpose of a numeric scale in risk management is to______________
A. Avoid high-impact risks
B. Assign a relative value to the impact on project objectives if the risk in question occurs C. Rank order risks in terms of very low, low, moderate, high, and very high
D. Test project assumptions
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
You can develop relative or numeric, well-defined scales using agreed-upon definitions by the stakeholders. When using a numeric scale, each level of impact has a specific number assigned to it.
QUESTION 1427
When managing current projects, it is important to use lessons learned from previous projects to improve the organization's project management process. Therefore, in project closing procedures, it is important to review the______________
A. Secondary risks that occurred B. Checklists for identify risks
C. WBS dictionary
D. Fallback plan
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Checklists are a tool and a technique of the identify risks process and include risks encountered on similar, previous projects identified through the lessons learned process and from other sources. The project team should review the checklist as part of the identify risks process as well as during closeout. The team should add to the list as necessary, based on its experience, to help others in the future.
QUESTION 1428
On a typical project, when are risks highest and impacts (amount at stake) lowest?
A. During the concept phase
B. At or near completion of the project
C. During the implementation phase
D. When the project manager is replaced
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Risks are highest at the beginning of a project because the project faces an uncertain future, and impacts are lowest at this time because investments in human and material resources are minimal.
QUESTION 1429
Two key inputs to the perform quantitative risk analysis process are the______________
A. WBS and milestone list
B. Scope management plan and process improvement plan C. Schedule management plan and cost management plan D. Procurement management plan and quality baseline
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The cost and schedule of a project are two areas significantly affected by risk occurrences. Information on these two areas, because of their quantitative nature, provides excellent input to the perform quantification risk process to help determine overall impact and to provide guidelines as managing risk reserves.
QUESTION 1430
The highest risk impact generally occurs during which one of the following project life-cycle phases?
A. Concept and planning
B. Planning and implementation C. Implementation and closeout D. Concept and closeout
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Opportunity and risk generally remain high during the concept and planning phases. However, the amount at stake remains low because of the relatively low level of investment up to that point. During project implementation and closeout, however, risk falls to lower levels as remaining unknowns are translated into knowns. At the same time, the amount at stake rises steadily as the necessary resources are invested to complete the project.
QUESTION 1431
Which one of the following statements best characterizes an activity cost or duration estimate developed with a limited amount of information? A. It should be part of the planning for the needed management reserve.
B. It is an input to identify risks.
C. It is an output from identify risks.
D. It must be factored into the list of prioritized project risks.
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Much of the output from planning in other knowledge areas, such as activity cost and duration estimates, may entail risk and is reviewed during the identify risks process. This process requires an understanding of the schedule, cost, and quality management plans found in the project management plan. Estimates that are aggressive or developed with a limited amount of information are even more likely to entail risk and, therefore, must also be an input to the identify risks process.
QUESTION 1432
What is the primary difference between a risk audit and a risk reassessment?
A. A risk reassessment is conducted at the completion of a major phase; audits are conducted after the project is complete. B. Project stakeholders conduct risk audits; management conducts reassessments.
C. Risk reassessments are regularly scheduled; risk audits are performed as defined in the project's risk management plan. D. There is no difference; they are virtually the same.
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Risk reassessment is an ongoing activity by the project team. Risks should be discussed at every status meeting. Risk audits are performed during the project life cycle to examine and document the effectiveness of risk responses. They are conducted at appropriate frequencies as defined in the risk management plan.
QUESTION 1433
Accurate and unbiased data are essential for perform qualitative risk analysis. Which one of the following should you use to examine the extent of understanding of project risk?
A. Data quality assessment
B. Project assumptions testing C. Sensitivity analysis
D. Influence diagrams
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Perform qualitative risk analysis requires accurate and unbiased data. The use of low-quality data may result in a qualitative risk analysis that is of little use to the project manager regarding understanding of the risk, data available about the risk, data quality, and data reliability and integrity.
QUESTION 1434
Contingency planning involves______________
A. Defining the steps to be taken if an identified risk event should occur
B. Establishing a management reserve to cover unplanned expenditures
C. Preparing a stand-alone document that is separate from the overall project plan
D. Determining needed adjustments to make during the implementation phase of a project
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
For some risks it is appropriate for the project team to make a response plan that will be executed only under certain predefined conditions if it is believed that there will be sufficient warning to implement the plan.
QUESTION 1435
Assume that you are working on a new product for your firm. Your CEO learned that a competitor was about to launch a new product that has similar features to those of your project. The competitor plans to launch the product on September 1. It is now March 1. Your schedule called for you to launch your product on December 1. Your CEO now has now mandated that you fast track your project so you can launch your product on August 1. This fast track schedule is an example of an______________
A. Unknown risk
B. A risk taken to achieve a reward
C. A response that requires sharing the risk D. A passive avoidance strategy
Correct Answer: B Section: Mix Questions
Explanation
Explanation/Reference:
Explanation:
Project risk has its origin in the uncertainty that is present in all projects. Organizations and stakeholders are willing to accept varying degrees of risk, and risks that are threats to the project may be accepted if the risks are within tolerances and are in balance with the rewards to be gained. This example of adopting a fast-track schedule is a risk taken to achieve the reward created by the earlier completion date.
QUESTION 1436
As head of the project management office, you need to focus on those items where risk responses can lead to better project outcomes. One way to help you make these decisions is to______________
A. Use a probability and impact matrix
B. Assess trends in perform quantitative risk analysis results C. Prioritize risks and conditions
D. Assess trends in perform qualitative risk analysis results
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The probability and impact matrix can be used to classify risks according to their level of impact and to prioritize them for future quantitative analyses and responses based on their rating. Typically these risk rating rules are specified by the organization in advance of the project. The matrix specifies combinations of probability and impact that lead to rating the risks as low, moderate, or high priority.
QUESTION 1437
What doctrine causes a party to relinquish rights under a contract because it knowingly fails to execute those rights?
A. Assignment of claims B. Material breach
C. Waiver
D. Warranties
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Under the doctrine of waiver, a party can relinquish rights that it otherwise has under the contract. If the seller offers incomplete, defective, or late performance, and the buyer's project manager knowingly accepts that performance, the buyer has waived its right to strict performance. In some circumstances, the party at fault may remain liable for provable damages, but the waiver will prevent the buyer from claiming a material breach and, thus, from terminating the contract.
QUESTION 1438
Which term describes those costs in a contract that are associated with two or more projects but are not traceable to either of them individually?
A. Variable
B. Direct
C. Indirect
D. Semivariable
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The nature of an indirect cost is such that it is neither possible nor practical to measure how much of the cost is attributable to a single project. These costs are allocated to the project by the performing organization as a cost of doing business.
QUESTION 1439
Contract type selection is dependent on the degree of risk or uncertainty facing the project manager. From the perspective of the buyer, the preferred contract type in a low-risk situation is______________
A. Firm-fixed-price
B. Fixed-price-incentive
C. Cost-plus-fixed fee
D. Cost-plus-a-percentage-of-cost
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Buyers prefer the firm-fixed-price contract because it places more risk on the seller. Although the seller bears the greatest degree of risk, it also has the maximum potential for profit. Because the seller receives an agreed-upon amount regardless of its costs, it is motivated to decrease costs by efficient production.
QUESTION 1440
Which term describes the failure by either the buyer or the seller to perform part or all of the duties of a contract?
A. Termination of contract B. Partial performance
C. Breach of contract
D. Contract waiver
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
A breach of contract is a failure to perform either express or implied duties of the contract. Either the buyer or the seller can be responsible for a breach of contract.
QUESTION 1441
Significant differences between the seller's price and your independent estimate may indicate all the following EXCEPT the______________
A. SOW was not adequate
B. Seller misunderstood the SOW
C. Sellers failed to respond
D. Project team chose the wrong contract type
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The contract type is typically dictated by the procurement SOW and chosen by the contracting officer. Independent estimates are a tool and technique in conduct procurements.
QUESTION 1442
When a seller breaches a contract, the buyer cannot receive______________
A. Compensatory damages B. Punitive damages
C. Liquidated damages
D. Consequential damages
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Punitive damages are designed to punish a guilty party and, as such, are considered penalties. Because a breach of contract is not unlawful, punitive damages are not awarded. The other remedies listed are available to compensate the buyer's loss.
QUESTION 1443
Because you are working under a firm-fixed-price contract, management wants you to submit the final invoice and close out the contract as soon as possible. Before final payment on the contract can be authorized, you must______________
A. Prepare a contract completion statement B. Audit the procurement process
C. Update and archive contract records
D. Settle subcontracts
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
All payments due must be settled by the seller before the contract can be officially closed. The other items listed are activities performed by the buyer.
QUESTION 1444
As you prepare to close out contracts on your project, you should review all the following types of documentation EXCEPT the______________
A. Contract document for the contract being closed B. Procurement audit report
C. Invoice and payment records
D. Seller performance reports
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
In most organizations, a procurement audit is conducted after the contract has been closed. Therefore, the project manager would not have a procurement audit report to review. Contract document for the contract being closed, invoice and payment records, and seller performance reports are examples of the documents that should be available to the project manager and should be reviewed at closeout.
QUESTION 1445
Your company decided to award a contract for project management services on a pharmaceutical research project. Because your company is new to project management and does not understand the full scope of services that may be needed under the contract, it is most appropriate to award a______________
A. Firm-fixed-price contract
B. Fixed-price-incentive contract
C. Cost-plus-a-percentage-of-cost contract D. Time-and-materials contract
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
A time-and-materials contract is a type of contract that provides for the acquisition of supplies or services on the basis of direct labor hours, at specified fixed hourly rates for wages, overhead, general and administrative expenses, and profit; and materials at cost, including materials-handling costs.
QUESTION 1446
Requirements for formal contract acceptance and closure usually are defined in the______________
A. Proposal
B. Statement of work
C. Contract terms and conditions D. Procurement audit report
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The contract terms and conditions typically describe the procedure the buyer will employ to close the contract.
QUESTION 1447
You plan to award a contract to provide project management training for your company. You decide it is important that any prospective contractor have an association with a major university that awards master's certificates in project management. This is an example of______________
A. Setting up an independent evaluation
B. Preparing requirements for your statement of work C. Establishing a weighting system
D. Establishing source selection criteria
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The selection criteria are typically included in procurement documents and are then used to rate or score proposals.
QUESTION 1448
All the following elements must be evident in a written contract for it to be legally enforceable EXCEPT______________
A. Legal capacity B. Mutual assent C. Appropriate form D. Pricing structure
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The following elements must be present for a contract to be legally enforceable: legal capacity, mutual assent, consideration, legality, and an appropriate contract form that follows applicable laws governing businesses.
QUESTION 1449
A purchase order is a good example of which form of contracting?
A. Unilateral B. Bilateral
C. Trilateral D. Severable
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The purchase order is a unilateral (one signature) offer that includes a promise to pay upon delivery.
QUESTION 1450
The primary benefit of contract control procurements is to ensure that______________
A. Buyers conduct performance reviews
B. Payment is made in a timely fashion
C. Disagreements are handled quickly and to everyone's satisfaction
D. Both parties meet contractual obligations and protect their legal rights
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Contracts are awarded to obtain goods and services in accordance with the buyer's stated requirements. Although there are multiple purposes in the control procurements process, ensuring that the seller delivers what is stated in the contract is of paramount importance.
QUESTION 1451
The principal function of a warranty is to______________
A. Provide assurance of the level of quality to be provided
B. Provide a way to assert claims for late payment
C. Provide a way to allow additional time following acceptance to correct deficiencies, without additional costs D. Ensure that goods purchased fit the purposes for which they are to be used
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
A warranty is one party's assurance to the other that goods will meet certain standards of quality, including condition, reliability, description, function, or performance. This assurance may be express or implied.
QUESTION 1452
As project manager, you need a relatively fast and informal method addressing disagreements with contractors. One such method is to submit the issue in question to an impartial third party for resolution. This process is known as______________
A. Alternative dispute resolution B. Problem processing
C. Steering resolution
D. Mediation litigation
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Alternative dispute resolution, or dispute resolution, is a relatively informal way to address differences of opinion on contracts. Its purpose is to address such issues without having to seek formal legal redress through the courts.
QUESTION 1453
A no-cost settlement sometimes is used______________
A. To close out a successful contract
B. In lieu of formal termination procedures
C. When buyer property has been furnished under the contract
D. When such an arrangement is acceptable to one of the parties involved
Correct Answer: B Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
A no-cost settlement can be used in lieu of formal termination procedures when the seller has indicated that such an arrangement is acceptable, no buyer property has been furnished under the contract, no payments are due the seller, no other obligations are outstanding, and the product or service can be readily obtained elsewhere.
QUESTION 1454
When writing payment terms in your fixed-price subcontracts it is especially important to______________
A. Include incentives if the seller exceeds or fails below defined objectives
B. Provide flexibility to redirect the seller if the scope of work is not defined precisely confusion C. Link progress made to compensation paid
D. Associate the payment to a specific time period for more efficient accounting
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
A buyer under a fixed-price contract should pay a seller for work delivered rather than time expended. Linking payment with progress ensures that the seller will focus on results and not on effort expended.
QUESTION 1455
Requirements for formal deliverable acceptance are defined in the______________
A. Contract
B. Procurement management plan C. Overall project management plan D. Specifications
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Two important components of any contract include what the buyer wants to buy and how the buyer defines acceptance of the products or services delivered. For contract closure to occur, deliverable acceptance must be completed.
QUESTION 1456
Payment bonds are often required by the contract and require specific actions under the stated conditions. Payment bonds are specifically designed to ensure that the prime contractor provides payment of______________
A. Insurance premiums
B. Weekly payrolls
C. Subcontractors, laborers, and sellers of material D. Damages for accidents caused
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
Payment bonds, which are required by the buyer, are issued by guarantors to prime contractors. The buyer wants to ensure that subcontractors of the prime contractor receive payment so that work is not disrupted.
QUESTION 1457
The best approach to resolve the settlement of all outstanding contract changes, claims, and disputes is using______________
A. Litigation
B. Alternative dispute resolution C. Negotiation
D. Mediation
Correct Answer: C Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
While there are a variety of ways to settle claims, disputes, and changes, the preferred approach is negotiation. It is a strategy to work toward compromise or to reach an agreement that both parties can accept.
QUESTION 1458
During contract negotiations on large contracts, the negotiation process focuses on many key issues, with price being one of them. Separate negotiations can be made on price, quantity, quality, and timing, which can significantly lengthen the process. The negotiation process can be shortened, however, provided that______________
A. Planning is done for negotiations
B. Expertise of the project management staff in the procurement process is at a high level C. A request for proposal is used rather than a request for quotation
D. There is integrity in the relationship and prior history with the vendor
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
When people know and trust one another, and in particular have worked with each other before, the negotiation process can be significantly shortened. Three major factors of negotiation should be followed: compromise ability, adaptability, and good faith.
QUESTION 1459
Contract negotiations are NOT required when______________
A. A company uses sealed bids
B. There is a sole source procurement C. A competitive range is established D. A two-step process is used
Correct Answer: A Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
When using the sealed bid method, competitive market forces determine the price, and the award goes to the lowest bidder, provided all other terms and conditions of the contract are met.
QUESTION 1460
It is critical during the proposal preparation stage that______________
A. The negotiation strategy is determined
B. A change management strategy is developed
C. Roles and responsibilities for the ultimate project are determined
D. Contract terms and conditions are reviewed before the proposal is submitted to the client
Correct Answer: D Section: Mix Questions Explanation
Explanation/Reference:
Explanation:
The contracts (legal) representative is responsible for the preparation of the contract portion of the proposal. Generally, contracts with the legal department are handed through or in coordination with the proposal group. Before the proposal is submitted to the client, contract terms and conditions should be reviewed and approved.