BASICS OF PROJECT MANAGEMENT - REPORTS

 OVERALL ANALYSIS
 COMPARISON REPORT
 SOLUTION REPORT

 ALL(25)

 CORRECT(0)

 INCORRECT(0)

 SKIPPED(25)
Q. 1
During the full life cycle of the project, a plot of the projects expected expenditures will usually
follow a characteristic... S... Shape. This indicates that

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AThere is a cyclic nature to all projects.
BProblems will always occur in the execution phase.
CThere are high expenditures during closeout.
DThe bulk of the project budget will be spent in the execution phase.Correct Option

Solution :
(d)

QUESTION ANALYTICS

Q. 2
Consider the following statements:
1. Security deposit is the amount to be deposited by the successful tenderer after the contract is
finalized and it is about 15% of the total value of the contract.
2. Earnest Money Deposit (EMD) is the amount to be deposited by the tenderer when the tender is
submitted.
Which of the above statement(s) is/are CORRECT?

Have any Doubt ?FAQ

A1 and 2Correct Option

Solution :
(a)
Earnest money deposit (EMD) is the amount to be deposited by the tenderer when they submit their
contract.
B1 only
C2 only
DNone of the above

QUESTION ANALYTICS

Q. 3
The indirect cost of a plant is 60000 per year. The direct cost is 40 per product. If the average
revenue per product is 80, the break-even point is

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A500 products
B750 productsCorrect Option

Solution :
(c)

C1500 products
DNone of these

QUESTION ANALYTICS

Q. 4
Match List-I with List-II and select the correct answer using the codes given below the lists:

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AaCorrect Option

Solution :
(a)
Bb
Cc
Dd

QUESTION ANALYTICS

Q. 5
Project Risk management refers to which one of the following?

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AManaging responses to threats.
BAcknowledging threats and opportunities.
CIdentifying high-threat potential problems and the action that is to be taken.Correct Option

Solution :
(c)
Project Risk Management refers to both identifying potential threats and possible actions to be taken
to reduce those risks. In risk management, high-threat potential problems are identified along with
the action that is to be taken on each high threat potential problem, either to reduce the probability
that the problem will occur or to reduce the impact on the project if it does occur.
DMinimizing threats and maximizing opportunities.

QUESTION ANALYTICS

Q. 6
Which of the following areas is NOT a requirement to be an effective project manager?

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AKnowledge of the area of application of the project.
BKnowledge of project management concepts and principles.
CAdvanced education and certifications in project management.Correct Option

Solution :
(c)
DGood communication and decision making skills.

QUESTION ANALYTICS

Q. 7
In the construction of networks, dummy activities are introduced in order to

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Acompute the slack on all events.
Btransfer resources, if necessary, during monitoring.
Cclearly designate a precedence relationship.Correct Option

Solution :
(c)
Dsimplify the crashing plan.

QUESTION ANALYTICS

Q. 8
The original cost of an equipment is Rs. 40,000. Its salvage value at the end of its total useful life of
five years is Rs. 5000. Its book value at the end of two years of its useful life (as per straight line
method of evaluation of depreciation) will be

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ARs. 35000
BRs. 32500
CRs. 30000
DRs. 26000Correct Option

Solution :
(d)

QUESTION ANALYTICS

Q. 9
The project phase can be broken down into five sub-phases:
1. Detailed design phase 2. Tendering phase
3. Basic design phase 4. Execution phase
5. Completion phase
The correct sequence of these sub-phase will be

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A1 – 2 – 3 – 4 – 5
B1 – 3 – 2 – 4 – 5
C3 – 1 – 2 – 4 – 5Correct Option

Solution :
(c)
D3 – 2 – 1 – 4 – 5

QUESTION ANALYTICS

Q. 10
The economic viability of a project can be assessed by the following methods

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ABenefit cost ratio
BPay back period and net present value
CReturn on investment and internal rate of return
DAll of theseCorrect Option

Solution :
(d)

QUESTION ANALYTICS

Q. 11
In CPM analysis a critical activity has
 Have any Doubt ?FAQ
Amaximum float
Bzero floatCorrect Option

Solution :
(b)
Cmaximum cost
Dminimum cost

QUESTION ANALYTICS

Q. 12
Which of the following statements are TRUE about net present value (NPV)?
1. Its accuracy is limited by the accuracy of the predicted cash flows and interest rates over the
duration of the project.
2. It gives a more accurate profit and less forecast than non-DCF calculations.
3. It uses a fixed interest rate.
4. It is biased towards long run projects.

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AAll of these
B1, 2 and 3Correct Option

Solution :
(b)
It is biased towards short run projects and it uses a fixed interest rate over the duration of the project.
C2, 3 and 4
D1, 3 and 4

QUESTION ANALYTICS

Q. 13
Consider the following statements regarding feasibility study of projects:
1. A feasibility study is conducted to investigate whether each option addresses the project objective.
2. It is undertaken during the planning phase of the project.
Which of the above statement(s) is/are CORRECT?

Have any Doubt ?FAQ

A1 onlyCorrect Option

Solution :
(a)
It is undertaken during initiation phase and not planning phase of project. A feasibility study is
conducted to investigate whether each option addresses the project objective and a recommended
solution is determined. Issues of feasibility and justification are addressed during initiation phase of
the project.
B2 only
C1 and 2 both
DNone of these

QUESTION ANALYTICS

Q. 14
Resource leveling will generally

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AReduce the time needed to do the project.
BIncrease the total time necessary to do all the tasks.
CReduce the overutilization of resources.Correct Option

Solution :
(c)
DReduce resources to the lowest skill that is possible.

QUESTION ANALYTICS

Q. 15
What are the three main items that must be clear to implement a successful project?

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ARisks, Quality and Time
BQuality, Scope and Cost
CScope, Cost and TimeCorrect Option

Solution :
(c)
DCost, Time and Risks

QUESTION ANALYTICS

Q. 16
Consider the given project network, where numbers along various activities represent normal time.
The free float on activity 4-6 and the project duration, respectively, are

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A2 and 13Correct Option

Solution :
(a)

B0 and 12
C-2 and 13
D2 and 12

QUESTION ANALYTICS

Q. 17
In a PERT network, expected project duration is found to be 45 days from the start of the project.
The variance is 16 days. The probability that the project will be completed in 45 days is

Have any Doubt ?FAQ

Azero
B34%
C50%Correct Option

Solution :
(c)

D84%

QUESTION ANALYTICS

Q. 18
If earned value (EV) is Rs. 800, actual cost (AC) is Rs. 600 and planned value (PV) is Rs. 550, then
the cost variance (CV ) (in Rs.) is

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A600
B-200
C200Correct Option

Solution :
(c)

DNone of these

QUESTION ANALYTICS

Q. 19
Project A has an internal rate of return IRR of 21 percent. Project B has an IRR of 7 percent. Project
C has an IRR of 31 percent. Project D has an IRR of 25 percent. Which of these would be the
WORST project?
 Have any Doubt ?FAQ
AProject A
BProject D
CProject C
DProject BCorrect Option

Solution :
(d)
Project C has the highest IRR and project B has lowest IRR so worst project is project B.

QUESTION ANALYTICS

Q. 20
In a matrix organisation, which one of the following is TRUE?

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AThe project manager is responsible for employee skills improvement.
BThe functional manager is responsible for employee skills improvement.Correct Option

Solution :
(b)
CThe project manager is responsible for the employees annual appraisal.
DThe employee is responsible for his or her own skills improvement

QUESTION ANALYTICS

Q. 21
Consider the following statements pertaining to CPM network analysis:
1. It is event-oriented method.
2. It is activity-oriented method.
3. Time and cost are controlling factors.
4. Time alone is controlling factor.
Which of these statements are CORRECT?

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A1 and 2
B2 and 3Correct Option

Solution :
(b)

C3 and 4
D1 and 4
 QUESTION ANALYTICS

Q. 22
Match List-I (Indications of terms) with List-II (Terms) and select the correct answer using the
codes given below the lists:

Have any Doubt ?FAQ

AaCorrect Option

Solution :
(a)
Bb
Cc
Dd

QUESTION ANALYTICS

Q. 23
Statement (I): Larger project may not be evaluated by direct observation.
Statement (II): Small project evaluated by collecting information from field staff and specialist.

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Aa
BbCorrect Option

Solution :
(b)
Cc
Dd

QUESTION ANALYTICS

Q. 24
Statement (I) : Moving average method of forecasting demand gives an account of the trends in
fluctuations and suppresses day-to-day insignificant fluctuations.
Statement (II) : Working out moving averages of the demand data smoothens the random day-to-
day fluctuations and represents only significant variations.

Have any Doubt ?FAQ

AaCorrect Option

Solution :
(a)
Bb
Cc
Dd

QUESTION ANALYTICS

Q. 25
Statement (I): Generally PERT is preferred over CPM for the purpose of project evaluation.
Statement (II): PERT is based on the approach of multiple time estimates for each activity.

Have any Doubt ?FAQ

AaCorrect Option

Solution :
(a)
Project management has evolved two analytical technique for planning, scheduling and controlling of
projects. These are the Critical Path Method (CPM) and the project evaluation and Review
Technique (PERT).
CPM – Activity Oriented
PERT – Event Oriented
Bb
Cc
Dd

QUESTION ANALYTICS