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PSP Paper – 1

S.1 In a project network schedule “Lag” means?

A. The amount of time a task can be delayed without delaying the project
B. The amount of time a task can be delayed without delaying the early start
date of its successor
C. Waiting time
D. The product of a forward and backward pass

S.2 A project manager may use _________ to make sure the clearly understand
what work is included in each of their work package.
A. The project scope statement
B. The contract documents
C. The detail Network Diagram
D. The WBS dictionary

S.3 To manage a project effectively, work should be broken down into small
pieces. Which of the following does not describe how far to decompose the
work?
A. Until it has meaningful conclusion
B. Until it cannot be logically subdivided further
C. Until it can be done by one person
D. Until it can be accurately estimated.

S.4 The work breakdown structure can be best thought of as an effective aid
for ___________ communications.
A. Project Team
B. Project Organisation
C. Senior management
D. Stakeholder

S.5 The WBS numbering system helps the project team to:
A. Integrate with the project management software.
B. Help in cost estimating each work package.
C. Identify the level in which each element could be found.
D. Assist us in preparation of sub-contractor packages.

S.6 All the following are characteristics of a project except:

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A. Temporary in nature.
B. A start and a definite end.
C. A set of activities getting repeated at regular interval.
D. Having at least one critical path.

S.7 To control the schedule, a project manager is reanalyzing the project to

predict the project duration. This is done by considering the activities with
least scheduling flexibility. The technique used here is:
A. The PDM technique.
B. The GHAANT Chart.
C. Duration compression.
D. The Critical Path Method.

S.8 The type dependency that requires excavation be completed prior to the
start of the foundation concrete is called:
A. Discretionary dependency.
B. External dependency.
C. Task dependency.
D. Mandatory dependency.

S.9 If the Optimistic estimate for an activity is 12 days, the Pessimistic

estimate is 18 days and Most likely estimate is 15, what is the standard
deviation of this activity?
A. 15.
B. 1
C. 3
D. 6.

S.10 The term LAG means?

A. The waiting time between the Early and Late start dates of an activity.
B. The amount of time an activity can be delayed without delaying the early
start of its successor.
C. The amount of time an activity can be delayed without delaying the project
completion date.
D. The amount of time between the Early finish date of an activity and Early
start of its successor.

S.11 Which of the following is the best project management tool to determine
the longest time for the project to be completed.

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A. Resource Leveling.
B. Project duration estimation.
C. The Network Diagram.
D. The weighted average duration estimate.

S.12 Which of the following statement is correct?

A. Resource leveling would increase the project risk.
B. Dummy activities would always be on the Critical path.
C. The project duration would be reduced if we have multiple critical paths.
D. The network diagram should have at least one Critical path.

S.13 What is true with regard to the Milestone?

A. Increased milestones in a project increase the project risk.
B. Milestones can take negative durations.
C. The duration of the milestone is usually the same as the activity it
represents.
D. Milestone help in monitoring of the project schedule.

S.14 The amount of time that an activity can be delayed from its early start
date without delaying project completion is called
A. total float
B. free float
C. interfering float
D. negative float

S.15 If your project will require redesign after completion of testing, which of
the following diagramming techniques would you use?
A. GERT
B. PERT
C. CPM
D. ADM

S.16 What does "resource leveling" mean in project management?

A. Shortening the time it takes to complete the project
B. Making the most efficient use of the available resources
C. Hiring contractors to fill in during 'peak' times on the project schedule
D. Reducing the project costs

S.17 Management has informed you that the resources for your project will be
cut. Management wants to know how long the project will take if nine

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resources per month are committed to your project. What is this activity
called?
A. Crashing
B. Floating
C. Leveling
D. Fast tracking

S.18 GERT is a method of:

A. Sequencing.
B. Definition.
C. Duration estimating.
D. Analysis.

S.19 All of the following are used in estimating EXCEPT?

A. Work breakdown structure
B. Team
C. Network diagram
D. Scope verification

S.20 A detailed project schedule can be created only after creating the:
A. Project budget.
B. Work breakdown structure.
C. Project plan.
D. All of the above

S.21 Total slack is the amount of time a task can be delayed without delaying
the:
A. Project.
B. Completion date required by the customer.
C. Early start of its successor.
D. Project completion date.

S.22 A design must be completed before manufacturing can begin. What kind
of dependency is this?
A. Independent dependency
B. External dependency
C. Mandatory dependency
D. Discretionary dependency

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S.24 A team member tells the project manager that their task will be delayed
four weeks. The project manager investigates and determines that the delay
will affect the project's completion date. Who should approve the change?
A. Management
B. Project manager
C. Team member
D. Functional manager

S.25 The estimate for a task is O = 3 days, P = 7 days, M = 4 days. What is

the standard deviation for this task?
A. 5/6 of a day
B. 2/3 of a day
C. 1 1/2 days
D. 5 2/3 days

S.26 You have a project with the following tasks: Task 1 can start immediately
and has an estimated duration of four. Task 2 can start after Task 1 is
completed and has an estimated duration of eight. Task 3 can start after Task
2 is completed and has an estimated duration of five. Task 4 can start after
Task 1 is completed and has an estimated duration of eight. Task 5 has an
estimated duration of three and must take place concurrently with Task 3. It
can start after Tasks 4 and 2. What is the duration of the critical path of this
project?
A. 15 days
B. 18 days
C. 17 days
D. 12 days

S.27 An activity-on-node diagram is different from an activity-on-arrow

diagram because an activity-on-node diagram:
A. Can use PERT.
B. Has four relationships among tasks
C. Has only finish-to-finish relationships.
D. May use dummy activities.

S.28 A dummy activity is best described as an activity __________

A. used in a PDM network to start a fragnet
B. used in ADM network to close an open end
C. used in ADM network to start a fragnet
D. that does not accurately define a scope of work

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S.29 Halfway through the execution phase of your project, a team member
alerts you to a potential cost overrun for a specific deliverable. What do you do
FIRST?
A. Determine the projected actual cost
B. Implement a change control process to track the change
C. Inform the customer
D. Determine the cause of the overage

S.30 The previous project manager informed management that all was well on
the project. However, the new project manager discovers that the project has a
CPI of .89. What does this mean?
A. At this time, it is expected that the total project will take 89% longer than
planned.
B. When the project is completed, 89% more than planned will have been
spent.
C. The project is only progressing at 89% of what was planned.
D. The project is only getting 89 cents out of every dollar invested.

S.31 You are asked to prepare a budget for completing a project that was
started last year and then shelved for six months. All the following would be
included in the budget EXCEPT?
A. Fixed cost
B. Sunk cost
C. Direct cost
D. Variable cost

S.32 You are trying to decide whether to lease or buy an item for your project.
The daily lease cost is US $150. To purchase the item, the investment cost is
US $2,000 and the daily cost is US $50. In how many days will the lease cost
be the same as the purchase cost?
A. 10 days
B. 15 days
C. 20 days
D. 25 days

S.33 If PV is US $29,000, AC is US $32,000, and EV is US $30,000, what is

the schedule variance?
A. 0.938
B. US $1,000

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C. 1.034
D. US $2,000

S.34 Which of the following BEST describes the meaning of the 50/50 rule?
A. Grant 50% progress A task begins and 50% upon completion
B. 50% of the work is done by 50% of the people on the project
C. Identify 50% of risks before you start to develop responses
D. A measure of Gantt chart review

S.35 Which estimating method tends to be MOST costly for creating a project
cost estimate?
A. Bottom up
B. Analogous
C. Parametric
D. 50/50 rule

S.36 The BEST description of costs that change with the amount of production
is:
A. Variable costs.
B. Fixed costs.
C. Direct costs.
D. Sunk costs.

S.37 Estimate at complete can be computed by taking the budget at complete

and:
A. Dividing it by the SPI.
B. Multiplying it by the SPI.
C. Multiplying it by the CPI.
D. Dividing it by the CPI.

S.38 As a project manager, you are presented with the following information
on the NPV for several potential projects. Which project is your BEST choice?
A. Project A with a NPV of US $95,000
B. Project B with an NPV of US $120,000
C. Project C with an NPV of US $20,000
D. Project D with an NPV of US $30,000

S.39 Your department is currently working on four urgent projects when it is

assigned a major new project. To staff the new project, one of the four urgent

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projects needs to be terminated. The cost benefits ratios for the four projects
are listed. Which would you select for termination?
A. 0.8
B. 1.0
C. 1.1
D. 10

S.40 All the following are cost estimating tools EXCEPT:

A. Lag.
B. Analogous.
C. Bottom up.
D. Parametric.

S.41 You are a project manager for a small construction project. Your project
was budgeted for US $72,000 over a six week period. As of today, you've spent
US $22,000 of your budget to complete work that you originally expected would
cost US $24,000. According to your schedule, you should have spent US
$30,000 by this point. Based on these circumstances, your project could be
BEST described as:
A. Under budget.
B. Over budget.
C. On schedule.
D. CPI is less than 1.

S.42 A project manager is controlling the performance of the project when the
project controls manager indicates the project has a SPI of .76. Which of the
following BEST describes what this means?
A. You are over budget.
B. You are ahead of schedule.
C. You are only progressing at 76% of the rate originally planned.
D. You are progressing at only 24% of the rate originally planned.

S.43 A project manager is controlling the performance of the project when the
project controls manager indicates the project has a SPI of 0.76. Which of the
following BEST describes what this means?
A. You are over budget.
B. You are ahead of schedule.
C. You are only progressing at 76% of the rate originally planned.
D. You are progressing at only 24% of the rate originally planned.

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S.44 The 50/50 rule is a method of:

A. Crashing.
B. PERT.
C. Performance
D. Cost

S.45 A project manager wants to decrease costs on a project that a consultant

is completing for her company. What costs should the project manager
consider to accomplish this?
A. Variable and fixed
B. Variable and direct
C. Fixed and indirect
D. Fixed and direct

S.46 Resources requirements are determined:

A. Before the project schedule and network diagram.
B. Ask the team for estimates of each task
C. Provide an order of magnitude estimate
D. Calculate an estimate using a computer model

S.47 A cost baseline is a product of:

A. Resource planning.
B. Cost estimating.
C. Cost budgeting
D. Cost control

S.48 An estimate at completion is an output of which cost management

process?
A. Resource planning.
B. Cost estimating.
C. Cost budgeting
D. Cost control

S.49 Project setup costs are an example of:

A. Variable costs.
B. Fixed costs.
C. Sunk costs.
D. Indirect costs.

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S.50 If project A has an NPV of US $30,000 and project B has an NPV of US

$50,000, what is the opportunity cost if project B is selected?
A. US $80,000
B. US $30,000
C. US $20,000
D. US $50,000

S.51 Which of the following is a KEY way to improve cost estimates?

A. Ensure Estimates are within Budgets
B. Base estimates between the upper and lower control limits
C. Change the Estimator
D. Use historical data

S.52 What is present value?

A. Sum of to-date expenditures on the project
B. Value of assets that a company owns
C. Today's value of future cash flows
D. Current value of assets adjusted for taxes and inflation

S.53 If EV is US $300,000, AC is US $350,000, and PV is US $375,000, what

does the schedule performance index indicate?
A. You are only progressing at 86% of the rate originally planned.
B. You are progressing at 125% of the rate originally planned.
C. You are progressing at 116% of the rate originally planned.
D. You are only progressing at 80% of the rate originally planned

S.54 You are a project manager working on a project that requires 100 widgets
to be built in five weeks. You have just begun week three, with an overall
budget of US $10,000. To date, you have spent US $2,000 with 40 widgets
successfully built. What does the cost variance tell you in this circumstance?
A. The project is proceeding at 100% of the expected rate.
B. The project is US $2,000 under budget.
C. The project is on budget.
D. The project is getting US $2 of work for every dollar spent.

S.55 Earned value analysis is an example of:

A. Performance
B. Planning control.
C. Cash Flow S- Curve
D. Budgeting

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S.56 A project has a payback period of nine months. What does this mean?
A. It will take the project nine months to start incurring costs.
B. The project will be completed in nine months.
C. The first nine months of the project will provide profit to the company.
D. It will take the project nine months to cover the investment and start
generating revenue.

S.57 If EV = 350, AC = 400, PV = 325, what is CV?

A. 350
B. -75
C. 400
D. -50

S.58 A customer has requested a change that requires you to obtain new
equipment. You need to decide whether to lease or buy the equipment. The
daily lease cost is US $150. The cost of purchasing the item is US $2,000 for
the investment cost and US $50 for the daily cost. You will need to use the
item for about 12 days. What should you do?
A. Lease it.
B. Buy it and sell it at the end of 12 days to obtain the scrap value
C. Ask the customer for a US $2,000 change order.
D. Lease it for only seven days to try to save cost.

S.59 Which of the following would be the BEST project to select?

A. A project with 6 years to complete and has an NPV of US $45,000
B. A project with 10 years to complete and has an NPV of US $85,000
C. A project with 8 years to complete and has an NPV of US $30,000
D. A project with 3 years to complete and has an NPV of US $60,000

S.60 A project team budgeted US $3,000 for the work performed and has
spent US $4,000, to date. If they budgeted US $5,000 for the work scheduled,
what is the cost variance?
A. US -$1,000
B. US $2,000
C. US $1000
D. US -$2000

S.61 A manufacturing project has a SPI of .89 and a CPI of .91. What is the
BEST explanation for why this occurred?

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A. The equipment for the project was more expensive than expected.
B. At least one task has taken more time than expected.
C. Less experienced resources were used.
D. The project baseline was changed more than once.

S.62 The amount of funds available for a company to invest in projects is

called:
A. Fixed Cost
B. Sunk Cost
C. Working capital
D. Direct Cost

S.63 An order of magnitude estimate is made during which project

management phase?
A. Planning
B. Project Closure
C. Execution
D. Initiation

S.64 During what time management process are the specific activities that
must be performed to produce the deliverables in the WBS identified and
documented?
A. Activity duration estimation
B. Schedule Development
C. Work package definition
D. Activity Definition

S.65 Rearranging resources so that there is a constant number of resource

getting used in each month is called:
A. Project crashing
B. Duration extension
C. Resource scheduling
D. Resource leveling

S.66 A WBS is described as a best tool for tracking?

A. The Project Budget
B. The Project Schedule
C. The Project Scope
D. The Project Work packages

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S.67 The process of creating a WBS results in:

A. The Activity list
B. The Project completion date
C. The Risk events in the project
D. A detail project schedule

S.68 The purpose of a status meeting is to:

A. Have the team members report on what they are doing
B. Exchange information about the project
C. Prepare cost report
D. Update the project schedule

S.69 In attempting to complete the project faster, the project manager looks at
the cost associated with crashing each task. The BEST approach to crashing
would also include looking at the:
A. The criticality and the risk impact of crashing each task.
B. Customer's opinion of what tasks to crash.
C. Owner’s opinion of what tasks to crash and in which order.
D. The project phase in which the task is due to occur in.

S.70 A project is a _________ effort, undertaken to create a ______________

product or service:
A. Unique, Temporary
B. Co-ordinated, Permanent.
C. Team, Useful.
D. Temporary, Unique.

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Correct Answers
S.1 – C
S.2 – D
S.3 - C
S.4 - D
S.5 - C
S.6 - C
S.7 - D
S.8. - D
S.9. - B
S.10 - D
S.11. - C
S.12 - D
S.13 – D
S.14 – A
S.15. – A
S.16. – B
S.17. – C
S.18. – A
S.19. – D
S.20. – B
S.21. – D
S.22 – C
S.23 – A
S.24. – A
S.25 – B
S.26. – C
S.27 – B
S.28. – D
S.29 – D
S.30 – D
S.31 – B
S.32. – C
S.33 – B
S.34. – A
S.35. – A
S.36 – A
S.37. –D
S.38. –B
S.39. –A
S.40. – A

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S.41. –A
S.42. –C
S.43. –C
S.44. –C
S.45. –B
S.46. –C
S.47. –C
S.48. –D
S.49. –B
S.50. –B
S.51. –D
S.52. –C
S.53. –D
S.54. –B
S.55. –A
S.56. –D
S.57. –D
S.58. –A
S.59 –B
S.60. –A
S.61. –C
S.62. –C
S.63. –D
S.64. –D
S.65. –D
S.66. –C
S.67. –A
S.68. –A
S.69. –A
S.70. –D

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