PRINCE2F PRINCE2 Practices Practice Question
A project to upgrade the IT infrastructure of a medium-sized company is in the Initiating a Project process. The project manager has created the Business Case, which shows a net present value (NPV) of £150,000 and an internal rate of return (IRR) of 12%. The project board's executive is concerned that the project may not deliver the expected benefits because the market demand for the new infrastructure is uncertain. The project manager is now preparing the Project Plan. What should the project manager do next?
⚠ Common exam trap
Candidates often think the Business Case is static once approved, but PRINCE2 requires it to be continually updated to reflect new risks or changes, and the Project Plan must be based on the most current version of the Business Case.
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Refine the Business Case by including a risk assessment of the market uncertainty and then create the Project Plan based on the refined Business Case.
D is correct because the Business Case must be refined to reflect the market uncertainty before the Project Plan is created. In PRINCE2, the Business Case is a living document that drives decision-making, and the Project Plan is based on it. Including a risk assessment of the market uncertainty ensures the project board can make an informed decision about whether the project remains viable, given the NPV and IRR are based on assumptions that may no longer hold.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
Ask the project board to approve the Project Plan subject to a review of the Business Case later.
Why it's wrong here
The Business Case should be finalized before plan approval.
- ✗
Proceed with the Project Plan as the Business Case already shows a positive NPV.
Why it's wrong here
The executive's concern must be addressed before finalizing the plan.
- ✗
Update the Business Case to reflect the uncertainty and seek approval from the project board before proceeding with the Project Plan.
Why it's wrong here
The project manager should not unilaterally update the Business Case; but this is close to correct, however the project manager should first refine the Business Case with the senior user and senior supplier.
- ✓
Refine the Business Case by including a risk assessment of the market uncertainty and then create the Project Plan based on the refined Business Case.
Why this is correct
The Business Case should be updated with risk information to support planning.
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Written by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
This PRINCE2F practice question is part of Courseiva's free PeopleCert certification practice question bank. Courseiva provides original exam-style practice questions with explanations, topic-based practice, mock exams, readiness tracking, and study analytics to help learners prepare for the PRINCE2F exam.