The correct answer is to escalate the issue to the project board as an exception. This is because the completed work package exceeded its agreed cost tolerance by $5,000, and in PRINCE2, any deviation beyond a work package’s tolerance must be formally escalated; the project manager does not have authority to approve such variances. On the PRINCE2 Foundation exam, this scenario tests your understanding of the management by exception principle—specifically, that tolerance is set at each level, and exceeding it triggers an exception report to the project board. A common trap is assuming the project manager can simply adjust the budget or absorb the overrun, but the rule is clear: tolerance breaches must be escalated, not resolved locally. Remember the memory tip: “Tolerance is a line, not a suggestion—cross it, and you must mention it.”
PRINCE2F PRINCE2 Processes Practice Question
This PRINCE2F practice question tests your understanding of prince2 processes. The scenario asks you to isolate a root cause — eliminate options that address a different problem before choosing. After answering, compare your reasoning against the explanation and wrong-answer breakdown below. Once you have made your selection, read the full explanation to reinforce the concept and understand why each distractor is designed to mislead on exam day.
Exhibit
Refer to the exhibit.
Project: Alpha
Stage: Stage 2
Work Package: WP-003
Status: Completed
Actual Cost: $45,000
Planned Cost: $40,000
% Complete: 100%
Tolerance: Cost: +/- 10%
Refer to the exhibit. The project manager is reviewing a completed work package in Stage 2. The actual cost exceeds the planned cost by $5,000. What should the project manager do?
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Escalate the issue to the project board as an exception.
Option C is correct because the work package is complete but the actual cost exceeds the planned cost by $5,000, which exceeds the tolerance set for the work package. In PRINCE2, any deviation beyond the agreed tolerance must be escalated to the Project Board as an exception, as the Project Manager cannot approve such variances themselves.
Key principle: Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
✗
Update the project plan to reflect the actual cost.
Why it's wrong here
Updating the plan comes after the issue is resolved; first, escalate the exception.
✗
Record the actual cost and continue with the project.
Why it's wrong here
The actual cost exceeds tolerance, so an exception report is needed before continuing.
✓
Escalate the issue to the project board as an exception.
Why this is correct
Since the cost variance exceeds the work package tolerance, the project manager must escalate via an exception report.
Related concept
Read the scenario before looking for a memorised answer.
✗
Accept the variance as the work package is complete.
Why it's wrong here
The variance exceeds the 10% tolerance, so it cannot be accepted without escalation.
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates often assume a completed work package with a cost overrun can simply be accepted or recorded, but PRINCE2 requires escalation whenever tolerances are exceeded, regardless of completion status.
Detailed technical explanation
How to think about this question
In PRINCE2, tolerances are set at multiple levels (project, stage, work package). When a work package exceeds its cost tolerance, the Project Manager must raise an Exception Report and submit it to the Project Board. The Project Board then decides whether to approve a change to the project plan, adjust tolerances, or take other corrective action. This ensures that the Project Manager does not unilaterally accept risks or costs beyond their delegated authority.
KKey Concepts to Remember
Read the scenario before looking for a memorised answer.
Find the constraint that changes the correct option.
Eliminate answers that are true in general but not in this case.
TExam Day Tips
→Watch for words such as best, first, most likely and least administrative effort.
→Review why wrong options are wrong, not only why the correct option is correct.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
How this comes up in practice
A practitioner preparing for the PRINCE2F exam encounters this exact type of scenario on the job. The correct answer here is not the most general option — it is the best answer for the specific constraint described. Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option. Real exam questions reward reading the full scenario before eliminating options, because the constraint defines which answer fits.
What to study next
Got this wrong? Here's your next step.
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
PRINCE2 Processes — This question tests PRINCE2 Processes — Read the scenario before looking for a memorised answer..
What is the correct answer to this question?
The correct answer is: Escalate the issue to the project board as an exception. — Option C is correct because the work package is complete but the actual cost exceeds the planned cost by $5,000, which exceeds the tolerance set for the work package. In PRINCE2, any deviation beyond the agreed tolerance must be escalated to the Project Board as an exception, as the Project Manager cannot approve such variances themselves.
What should I do if I get this PRINCE2F question wrong?
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
What is the key concept behind this question?
Read the scenario before looking for a memorised answer.
About these practice questions
Courseiva creates original exam-style practice questions with explanations and wrong-answer analysis. It does not publish real exam questions, exam dumps, or protected exam content. Learn why practice questions differ from exam dumps →
Share a tip, memory trick, or ask about the reasoning behind this question. Do not post real exam questions, leaked content, braindumps, or copyrighted exam material. Comments are moderated and may be removed without notice.
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.
Question Discussion
Share a tip, memory trick, or ask about the reasoning behind this question. Do not post real exam questions, leaked content, braindumps, or copyrighted exam material. Comments are moderated and may be removed without notice.
Sign in to join the discussion.