PRINCE2F PRINCE2 Practices Practice Question
Which THREE of the following statements about the PRINCE2 principle 'Manage by Exception' are correct?
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
✓
Tolerances are set for each management level
Options B, C, and D are correct. Manage by Exception means each management level sets tolerances for the level below, and escalation occurs only when a tolerance is forecast to be exceeded. The Project Board sets stage tolerances for the Project Manager (B, D). If a stage tolerance is forecast to be exceeded, the Project Manager must escalate to the Project Board (C). Option A is false because the Project Board sets project tolerances, not the Project Manager. Option E is false because management by exception does not eliminate reporting; it defines when escalation is needed — reports are still required for monitoring.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
The Project Manager sets project tolerances for the Project Board
Why it's wrong here
Project tolerances are set by the Project Board or higher management, not by the PM.
- ✓
Tolerances are set for each management level
Why this is correct
PRINCE2 defines tolerances at project, stage, and work package levels.
- ✓
If a stage tolerance is forecast to be exceeded, the Project Manager must escalate to the Project Board
Why this is correct
This is the core of management by exception: escalation when tolerances are breached.
- ✓
The Project Board sets stage tolerances for the Project Manager
Why this is correct
The Project Board authorizes stage tolerances, within which the PM operates.
- ✗
Management by exception means that no reports are required unless a tolerance is exceeded
Why it's wrong here
Regular Highlight Reports and Checkpoint Reports are still required; management by exception defines when to escalate beyond normal reporting.
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Variation 1. Which TWO statements about tolerances in PRINCE2 are correct?
hard- A.Tolerances are only for cost and time
- B.Tolerances apply at project level only
- ✓ C.Tolerances are defined for each management stage
- D.Tolerances are set by the Project Manager
- ✓ E.If a tolerance is forecast to be exceeded, the Project Manager must escalate via an Exception Report
Why C: Tolerances are defined for each stage by the Project Board, and the Project Manager may only deviate within that tolerance without escalation. They are set for time, cost, scope, quality, risk, and benefits.
JA
Written by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
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