PK0-005 Project Management Concepts Practice Test 7 — 15 Questions

Question 1

A company is evaluating two projects. Project A has an NPV of $50,000 and a payback period of 3 years. Project B has an NPV of $40,000 and a payback period of 2 years. Which project should be selected based on NPV?

Choose an answer to begin — your selection is scored in the full session.

Accepted Answer

Project A because it has a higher NPV. NPV is a primary indicator of profitability. Higher NPV is better, regardless of payback period.

Answer

Neither project should be selected

Answer

Project B because it has a shorter payback period

Answer

Both projects are equally good

Question 2

In a matrix organization, a project manager needs to acquire a team member from a functional department. The functional manager is reluctant to release the resource due to other work. What is the best way for the project manager to address this?

Accepted Answer

Negotiate with the functional manager for the resource. In a matrix organization, the PM must negotiate with the functional manager for resources.

Answer

Hire an external contractor

Answer

Assign the task to another team member

Answer

Escalate to the project sponsor immediately

Question 3

A project manager is leading a project that uses a hybrid methodology. The project has a fixed deadline but the requirements are expected to evolve. Which approach best describes how the PM should handle the project?

Accepted Answer

Plan the overall schedule and budget predictively, but develop requirements iteratively. Hybrid combines predictive planning for fixed elements (like deadline) with agile iterations for evolving requirements.

Answer

Use a fully predictive approach to ensure the deadline is met

Answer

Use a fully agile approach and adjust the deadline as needed

Answer

Use a Kanban board without any upfront planning

Question 4

A steering committee is reviewing project performance. Which of the following is a key responsibility of the steering committee?

Accepted Answer

Approving changes to the project scope. The steering committee provides governance, approves major changes, and ensures alignment with business objectives.

Answer

Assigning daily tasks to team members

Answer

Developing the project schedule

Answer

Resolving technical issues

Question 5

Which TWO of the following are characteristics of the planning phase in the project life cycle? (Choose TWO.)

Accepted Answer

Creating the work breakdown structure (WBS). Option B is correct because creating the work breakdown structure (WBS) is a core planning activity that decomposes the total project scope into manageable, deliverable-oriented work packages used for estimating, scheduling, and control. Option D is correct because risk identification is performed during planning (as part of risk management planning) to enumerate potential threats and opportunities before they affect scope, schedule, or cost. Option A is incorrect because developing the project charter occurs in the initiating phase, before planning begins. Option C is incorrect because delivering project deliverables happens in the executing phase. Option E is incorrect because obtaining final acceptance occurs in the closing phase, after deliverables are verified and handed over.

Answer

Developing the project charter

Answer

Delivering project deliverables

Answer

Obtaining final acceptance

Question 6

A project manager is leading a project with a tight budget. The team has completed all required features, but there is some remaining budget. The sponsor suggests adding a few extra features. What are TWO potential issues the project manager should consider before approving? (Choose TWO.)

Accepted Answer

The extra features may cause schedule delays. Option B is correct because adding features that were not in the approved scope constitutes scope creep, and the additional analysis, development, and integration work required to deliver them will consume schedule float and can push the project past its planned completion date. Option D is correct because even if the remaining budget covers initial development, every added feature must be tested, documented, and then maintained and supported for the product's lifecycle, creating recurring costs that the project budget does not account for. Option A is incorrect because regulatory compliance would be mandatory scope, not an optional 'extra' feature, and the scenario states all required features are already complete. Option C is incorrect because improved customer satisfaction is a potential benefit, not a potential issue the project manager must weigh. Option E is incorrect because the sponsor is proposing features beyond what was completed, so they are by definition outside the original scope.

Answer

The extra features are necessary for regulatory compliance

Answer

The extra features will improve customer satisfaction

Answer

The extra features are part of the original scope

Question 7

A project manager is assigned to a new software development project. The requirements are well understood and unlikely to change. The project team is collocated and has experience with similar projects. Which life cycle approach is MOST appropriate for this project?

Accepted Answer

Predictive (waterfall). Predictive (waterfall) is best when requirements are stable, the team is experienced, and the work is well understood. Agile is for evolving requirements; hybrid would be overkill; iterative is not as structured as predictive for stable requirements.

Answer

Agile

Answer

Hybrid

Answer

Iterative

Question 8

In a matrix organization, a project manager is struggling to get resources assigned to project tasks because the functional managers prioritize operational work. Which type of matrix organization is MOST likely in place?

Accepted Answer

Weak matrix. In a weak matrix, the project manager has limited authority and resources are controlled by functional managers. Strong matrix gives PM more authority; balanced is in between; functional is not a matrix.

Answer

Strong matrix

Answer

Balanced matrix

Answer

Functional

Question 9

A project sponsor is reviewing a proposal for a new project. The expected cash flows are: Year 0: -$100,000; Year 1: $30,000; Year 2: $40,000; Year 3: $50,000. The discount rate is 10%. Which of the following is the Net Present Value (NPV) of the project?

Accepted Answer

-$2,103. NPV = -100,000 + 30,000/(1.10)^1 + 40,000/(1.10)^2 + 50,000/(1.10)^3 = -100,000 + 27,273 + 33,058 + 37,566 = -2,103. Negative NPV means the project is not profitable at 10% discount rate.

Answer

-$20,000

Answer

$20,000

Answer

$2,103

Question 10

During project execution, the project manager notices that the development team has been adding extra features that were not requested by the customer. Which of the following describes this behavior?

Accepted Answer

Gold plating. Gold plating is when the team adds extra features beyond requirements without approval. Scope creep is uncontrolled changes to scope; change control is the process to manage changes; value engineering improves value without extra cost.

Answer

Value engineering

Answer

Scope creep

Answer

Change control

Question 11

Which of the following is a key responsibility of the project sponsor?

Accepted Answer

Providing resources and removing obstacles. The project sponsor provides resources, champions the project, and resolves escalations. The PM plans and executes; the team does tasks; the steering committee provides governance.

Answer

Performing quality assurance

Answer

Developing the project schedule

Answer

Executing project tasks

Question 12

A project to build a new office is in the planning phase. The project manager wants to use a methodology that allows for flexibility in design while still having a clear upfront plan for the overall construction. Which approach is BEST?

Accepted Answer

Hybrid. Hybrid project management combines predictive (waterfall) and adaptive (agile) elements. In this scenario, the project manager needs a clear upfront plan for the overall construction (predictive) but also flexibility in design (agile). Hybrid allows for a predictive overall plan with iterative design phases, making it the best fit. Agile alone lacks the upfront planning, Scrum is a specific agile framework not suited for construction, and predictive waterfall lacks flexibility.

Answer

Agile

Answer

Scrum

Answer

Predictive (waterfall)

Question 13

A project manager is evaluating two projects. Project A has an initial investment of $50,000 and expected annual returns of $15,000 for 5 years. Project B has an initial investment of $80,000 and expected annual returns of $22,000 for 5 years. Based on payback period, which project should be selected, and what is the payback period for that project?

Accepted Answer

Project A, 3.33 years. Project A's payback period is calculated as initial investment divided by annual return: $50,000 / $15,000 = 3.33 years. Project B's payback is $80,000 / $22,000 = 3.64 years. Since Project A recovers its investment faster (3.33 years vs. 3.64 years), Project A should be selected, making option D correct.

Answer

Project A, 3.00 years

Answer

Project B, 3.64 years

Answer

Project B, 3.00 years

Question 14

Which project life cycle phase involves formally accepting the project deliverables and releasing resources?

Accepted Answer

Closing. The Closing phase is where the project manager obtains formal acceptance of the deliverables from the customer or sponsor, confirms that all contractual obligations are met, and then releases project resources (team members, equipment, facilities). This phase also includes administrative closure activities such as archiving documents, capturing lessons learned, and finalizing procurement closures. Unlike other phases, Closing is specifically designed to transition the project output to the intended recipient and disband the project team.

Answer

Planning

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Executing

Answer

Initiating

Question 15

A project manager is working in an organization where the project team members report to both a functional manager and the project manager. The project manager has moderate authority and shares resource management with functional managers. This is an example of which organizational structure?

Accepted Answer

Balanced matrix. In a balanced matrix organization, the project manager has moderate authority and shares resource control with functional managers, while team members report to both. This dual reporting line and shared authority are the defining characteristics of a balanced matrix. It sits between the weak matrix (PM has low authority) and the strong matrix (PM has high authority).

Answer

Functional

Answer

Projectized

Answer

Weak matrix