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                        Questions on Project Integration Management

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                        Questions

                        1. Which process formally authorizes the project?
                          1. Receive project approval
                          2. Identify Project Manager
                          3. Develop preliminary project statement
                          4. Develop project charter
                          CORRECT: D. Develop project charter process formally authorizes the project and identifies the project manager.
                        2. Develop project charter is part of which process group?
                          1. Initiation
                          2. Planning
                          3. Executing
                          4. Monitoring and Control
                          CORRECT: A.
                        3. John Smith is a Project Manager for XYZ consultants. He has been asked to help choose one of the four potential project candidates. The management used Payback period technique for project selection. Which of the following projects should John recommend to the management.
                          1. Building an apartment. Project involves making an investment of $200,000. After six months, there will be monthly rental returns of $5000.
                          2. Building a bridge. Project involves making an investment of $1,000,000. After two years, there will be monthly returns via toll for the bridge of $50,000.
                          3. Building a house. Project involves making an investment of $500,000. After one year, there will be monthly rental returns of $10,000.
                          4. Building a school. Project involves making an investment of $500,000. After one year, there will be monthly returns via school fees of $50,000.
                          CORRECT: D. For option A, 46 months is the payback period. For option B, 44 months is the payback period. For option C, 62 months is the payback period. For option D, 22 months is the payback period. Building a school has the minimum payback period.
                        4. Alice Newland is a Project Manager for XYZ consultants. She has been asked to help choose one of the four potential project candidates. The management used internal rate of return technique for project selection. Which of the following projects should Alice recommend to the management.
                          1. Project A requires making an initial investment of $100,000 and will give monthly return of $5,000.
                          2. Project B requires making an initial investment of $200,000 and will give monthly return of $8,000.
                          3. Project C requires making an initial investment of $100,000 and will give annual return of $40,000.
                          4. Project D requires making an initial investment of $200,000 and will give annual return of $60,000.
                          CORRECT: A. Project A has best internal rate of return of $60K annually for an investment of $100,000.
                        5. Which of the following is not a process in the Project Integration Management process group?
                          1. Develop project charter
                          2. Close project or phase
                          3. Identify Project Manager
                          4. Monitor and Control Project work
                          CORRECT: C. Identify Project Manager
                        6. XYZ Corporation is using weighted scoring model to select one project out of four projects. The importance criteria as well as ratings of four projects are given below. Which of the following projects will be selected?
                          1. Project A
                          2. Project B
                          3. Project C
                          4. Project D
                          Project weights
                          Criteria Weight Project A Project B Project C Project D
                          Time to Market 2 6 6 2 4
                          Availability of resources 3 7 4 1 4
                          Sales potential 5 1 2 5 5
                          Fitment with other products 4 5 3 6 5
                          CORRECT: D. A weighted average for all four projects is computed and one with highest weighted average is selected. For project D, the weighted average is (4*2) + (4*3) + (5*5) + (5*4). Total score for project D is 65. This is highest across all projects.
                        7. PQ Corporation is using Payback period to choose one project out of four options. Which of these projects should be selected by the company?
                          1. Project A
                          2. Project B
                          3. Project C
                          4. Project D
                          Payback period
                          Project Name Initial investment Cash inflow per quarter
                          Project A $200,000 $10,000
                          Project B $100,000 $2,000
                          Project C $400,000 $80,000
                          Project D $500,000 $125,000
                          CORRECT: D. Project D requires four quarters to payback the investments. This is the minimum time when compared to other projects.
                        8. Which of the following is not true about project charter?
                          1. Project charter is written by the Project Manager.
                          2. Project charter defines the purpose of the project
                          3. Identify and authorizes the Project Manager
                          4. Project charter is authorized by Executive Management
                          CORRECT: A
                        9. Project A requires investment of $500,000. The project is expected to generate $25K per quarter for first year and $100K per quarter after that. What is the payback period
                          1. One year
                          2. Two years
                          3. Three years
                          4. Eight years
                          CORRECT: B. Payback period is eight quarters.
                        10. Chris is performing Earned Value technique on the project that she is managing. PV=200 EV=175 AC=150 What is the cost variance?
                          1. 25
                          2. -25
                          3. 50
                          4. -50
                          CORRECT: A. Cost variance is equal to Earned Value - Actual cost.
                        11. Chris is performing Earned Value technique on the project that she is managing. PV=200 EV=175 AC=150 Whast is the schedule variance?
                          1. 25
                          2. -25
                          3. 50
                          4. -50
                          CORRECT: B. Schedule variance is equal to Earned value - Planned value.
                        12. Chris is performing Earned Value technique on the project that she is managing. PV=200 EV=175 AC=150 What is the CPI?
                          1. 1.33
                          2. 0.75
                          3. 1.14
                          4. 1.16
                          CORRECT: D. Cost Performance Index = (Earned Value)/(Actual cost)
                        You have answered  of 12 questions correctly.

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