Arab Academy

Project Management

Name:

True/ False (Correct False statement) (10 Marks)(Each point 0.5 mark)

1) Projects, rather than repetitive tasks, are now the basis for most value-added in business.
(True)

2) The initial goal and technical specifications of the project are developed during the planning
stage. (False)

3) Client interest in a project is highest during the termination and conceptual phases. (True)
1) Projects, rather than repetitive tasks, are now the basis for most value-added in business.

2) The initial goal and technical specifications of the project are developed during the planning
stage.

3) Client interest in a project is highest during the termination and conceptual phases.

4) The classic triple constraint standard for project performance is composed of time, cost, and
client acceptance. (False)

5) The statement of work is a detailed narrative description of the work required for a project.
(True)

6) A work package may be composed of one or more subdeliverables. (False)

7) A work package may consist of more than one milestone. (True)

8) Risks can be quantified by multiplying the likelihood a failure will occur by the severity of the
failure. (True)

9) The probability that the investments made to fund the front-end activities will be lost due to
project abandonment is financing risk. (False)

10) Direct costs are those clearly assigned to the aspect of the project that generated the cost.
(True)

11) Material is an example of a cost that is recurring, variable and direct. (True)

12) An expedited cost is one that does not vary with respect to their usage. (False)

13) An order of magnitude estimate is usually more accurate than a ballpark estimate. (False)

14) Comparative estimates are more accurate than definitive estimates when applied to the same
project. (True)
15) One approach to risk mitigation is simply to accept it. (True)

16) Risk cannot be transferred because ultimately your own project will suffer the consequences
if the event occurs. (False)

17) Contingency reserves require a construction company to hold back some funds in an account
just in case something happens that increases the overall project cost. (True)

18) The first step in assembling a project team is to talk to potential team members. (False)

19) If preferred project team members are not available, the project manager should notify top
management of the consequences. (True)

20) Project managers are best able to promote a sense of enthusiasm within the project team
when they create an environment that is challenging, supportive, and personally rewarding.
(True)

Multiple Choices (15 Marks)(Each point 0.5 mark)

1) Keith Monroe nails hundreds of pieces of culled lumber in the blazing July sun to form a
parquet deck for his barn roof. He and his assistant are clearly in:
A) the termination stage of the project life cycle.
B) the planning stage of the project life cycle.
C) the execution stage of the project life cycle.
D) way over their heads.

2) The statement of work should contain:

A) information on the key objectives for the project.
B) a brief and general description of the work to be performed.
C) expected project outcomes.
D) All of these are elements of a statement of work.

3) The degree of risk associated with the project is typically at its highest during the:
A) conceptualization phase.
B) planning phase.
C) execution phase.
D) termination phase.
4) The commitment of financial, human, and technical resources is highest during the:
A) conceptualization phase.
B) planning phase.
C) execution phase.
D) termination phase.

5) The new Magic Pan coming soon to your area usually serves 20,000 customers in the first
year of operation. Construction plans include site selection, foundation, framing, finishing, egg-
laying, and chicken acquisition. The scope statement step that determines relationships among
these steps, e.g. does the chicken acquisition come before the egg laying, etc., is the:
A) project goal criteria.
B) management plan.
C) work breakdown structure.
D) scope baseline

6) A design project is completed on time, under budget, to the customer's satisfaction, and in
adherence to the technical specifications agreed. The new product takes the market by storm and
everyone associated with the project receives a coveted gold star. Under the four dimensions of
project success model, the project still needs to show:
A) future potential.
B) business success.
C) impact on the customer.
D) efficiency.

7) The second level in work breakdown structure contains the:

A) projects.
B) deliverables.
C) subdeliverables.
D) work packages.

8) A project manager can identify personnel who will be directly responsible for each task in the
project's development by using a(n):
A) responsibility assignment matrix.
B) milestone designation chart.
C) Merrill report.
D) work package report.
9) The step that reflects the formal "go ahead" given to the project to commence once the scope
definition, planning documents, and other contractual documents have been prepared and
approved is the:
A) go ahead.
B) send off.
C) work authorization.
D) work release.

10) A project management firm that promises to do everything for a major project and hand over
a fully functional, ready-to-use deliverable is performing under a(n):
A) umbrella contract.
B) all-inclusive contract.
C) cost-plus contract.
D) turnkey contract.

11) Your professor moonlights to make ends meet during the summer months and has a knack
for painting houses. You agree to pay $500 over whatever the materials and equipment rental
cost for the job and delight in sipping lemonade in the shade watching your poor professor
perform under a(n):
A) cost-plus contract.
B) lump sum contract.
C) time and material contract.
D) fixed wage contract.

12) The framing crew would never know when it was time to order more $400 hammers without
their fancy new:
A) acquisition control system.
B) specification control system.
C) configuration control system.
D) design control system.
13) The period of highest risk impact for a project risk exists primarily in the:
A) development stage of the project life cycle.
B) concept stage of the project life cycle.
C) implementation stage of the project life cycle.
D) termination stage of the project life cycle.

14) The greatest project opportunity occurs when:

A) the project is in the concept phase.
B) the project is in the development phase.
C) the project is in the implementation phase.
D) the project is in the termination phase.

15) A project manager can identify the skills needed for the project from the:
A) departmental personnel listings.
B) project budget.
C) stakeholder meeting.
D) work breakdown structure

16) While thrilling, there is a chance that you would have an accident if you elected to drive on
the Autobahn while blindfolded, an outcome that could be described as:
A) high in consequence and high in probability.
B) low in consequence and low in probability.
C) low in probability and high in consequence.
D) high in probability and low in consequence.

17) The project team's office needed a revolving door to facilitate the influx and outflow of
personnel. Team members needed name tags to keep track of who was who and what their duties
were. The project was jeopardized by:
A) poor leadership.
B) high turnover.
C) lack of team motivation.
D) poor communication among team members
18) A method for conducting risk factor identification that consolidates the judgments of isolated
anonymous respondents is:
A) a brainstorming meeting.
B) the Delphi method.
C) past history.
D) multiple assessments.

19) The terpsichorean was familiar with the risks associated with various moves, the accountant
knew financial risks forwards and backwards, while the civil engineer could quantify the risks
associated with distributed loads on the temporary stage. Their input was used as part of:
A) a brainstorming meeting approach to risk factor identification.
B) the Delphi method approach to risk factor identification.
C) a past history approach to risk factor identification.
D) a multiple assessments approach to risk factor identification.

20) "Our work here is done," the project leader shouted as he surveyed the scene. "Go home and
reflect on what you've accomplished and I'll see you at the world premier once we're all
immortalized in a feature length movie." This project team is in the:
A) forming stage of group development.
B) norming stage of group development.
C) performing stage of group development.
D) adjourning stage of group development.

21) The consequences of failure categories of cost, schedule, reliability, and performance were
believed to be 0.2, 0.6, 0.5, and 0.7. What is the overall consequence of failure?
A) 0.2
B) 0.3
C) 0.4
D) 0.5
22) If the risk of a negative outcome is slight, the best course of action might be to:
A) minimize it.
B) share it.
C) transfer it.
D) accept it.

23) Which of the following is a direct cost?

A) labor
B) rent
C) depreciation on equipment
D) health benefits

24) Which of these indirect costs is typically classified as a selling or administrative cost?
A) secretarial support
B) utilities
C) insurance
D) depreciation

25) Which of these is typically a recurring cost?

A) preliminary market analysis
B) personnel training
C) outplacement services
D) logistics

26) The charge that is most likely a fixed cost is for:

A) materials.
B) equipment rental.
C) direct labor.
D) utilities.

27) Unplanned costs incurred when steps are taken to speed up project's completion are called:
A) expedited costs.
B) accelerated costs.
C) pass-through costs.
D) normal costs.
28) The order of magnitude cost estimate is used when:
A) ballpark estimates are not considered accurate enough.
B) historical data are readily available.
C) information or time is scarce.
D) parametric estimation has already been performed

29) Which of these estimates should be the most accurate?

A) parametric
B) definitive
C) comparative
D) order of magnitude

30) Project management people skills include:

A) team building.
B) scheduling.
C) budgeting.
D) project evaluation.
Essay questions (25 Marks)(Each point 5 mark)

Answer only 5 questions

1) Explain the difference between normal and expedited costs, fixed and variable costs, and
recurring or nonrecurring costs (Illustrate your answer with examples)

2) Define learning curve theory and describe how learning curves are used in project
management.

3) How are top-down and bottom-up budgets created? What advantages does each approach hold
over the other?

4)What are the four distinct stages of systematic risk management and what takes place at each?
What are the basic qualitative methods for identifying risk factors? What are the advantages and
disadvantages of each method?

5) How do mentoring and cross-training mitigate risk?

6) Provide examples and discuss the differences between direct and indirect costs

7) What is organization breakdown structure?

8) What is the difference between a turnkey contract and a cost-plus contract? Include in your
discussion the advantages and disadvantages of each.
End of the exam