Practice Test 1 ◾ 139
92. Assume you are managing your city’s portfolio, and its overall strategic goal
is to promote economic development to attract more visitors to the city. It is
a difcult challenge as the city is not a major metropolitan area and also is
not a preferred winter or summer destination. Nonetheless, you are planning
and allocating resources according to the city’s strategy. Not to be over-
looked as you do so is the need to:
a. Obtain support from your key stakeholders
b. Determine a communication strategy to explain your approach
c. Maximize return considering the city’s risk tolerance
d. Continually update the portfolio inventory
93. As you work to determine which stakeholders had the highest degree of
inuence over the portfolio, you wanted to especially know about the mem-
bers of the Portfolio Governance Board because:
a. They would have numerous interrelationships with other stakeholders
b. They would be best suited to work with people who were not portfolio
management supporters
c. The governance processes affect information requirements
d. All of the portfolio changes, risks, and issues would be of interest to
them
94. Embracing a management- by- projects culture means there tends to be
far more projects to pursue than available resources. An approach then is
required to guide decisions as to components in the portfolio. A best prac-
tice to follow is to:
a. Set forth in the portfolio strategic plan a prioritization model
b. Develop a portfolio roadmap
c. Focus on both internal and external environmental changes
d. Focus on sustainment of project benets
95. You are the portfolio manager for a large county that comprises much of a
major city in your country. The city also has a portfolio manager, and often
you meet to discuss proposed initiatives to see if there are any dependen-
cies. In your county, you established an approach to evaluate portfolio com-
ponents to make judgments regarding their alignment and priority. In doing
so, which of the following was especially helpful:
a. Portfolio strategic plan
b. Portfolio management plan
c. Portfolio roadmap
d. Portfolio charter
140 ◾ PfMP® Exam Practice Tests and Study Guide
96. Your company’s water treatment center serves three cities. Tests are con-
ducted each day to see if the water is safe to drink. On Thursday, E coli
were found in the water, but the water authority did not notify the citizens
in the three cities. Instead, the citizens learned on Friday, the water was now
safe to drink. The citizens are in an uproar, and your company is to blame.
It is obvious one of the problems is the aging infrastructure and limited
resources. To best optimize the portfolio, your CEO asked you to:
a. Reallocate nancial and other resources to new components to avoid this
problem in the future
b. First determine why citizens were not aware of the problem
c. Analyze the testing methods in use for effectiveness
d. Analyze the physical needs
97. Your Portfolio Review Board is scheduled to meet in a week. Resources only
are available to support one project, and detailed business cases have been
prepared for two of them. Your company has a policy of being risk adverse.
Consider the following table:
Project 1 Project 2
Benets $750,000 $25,000
Costs $500,000 $15,000
Which project would you recommend to the Board, and what else would
you mention to them?
a. Project A and it has less risk associated with it
b. Project B and it has less risk associated with it
c. Project A as the benets will be realized in a shorter time period
d. Project B but other qualitative items are not available
98. As you prepare a list of possible components for your railroad to consider
since most of its programs and projects are large and complex, your man-
agement team has suggested in your analysis of which components to
pursue that you conduct statistical simulations of budgets, schedules, and
resource allocations. You therefore decide to use:
a. Net present value
b. Decision trees
c. Monte Carlo analysis
d. An interrelationship diagraph
Practice Test 1 ◾ 141
99. You have a portfolio component that is using earned value analysis. It is at
the 15% point of completion, and it is evident that it cannot be completed
as planned. Adding resources will not solve the problem, and at the last
Portfolio Review Board meeting, the Board members decided to terminate
this component based on its various risks. They then decided the resources
allocated to this component could be transferred to other portfolio compo-
nents enhancing their early completion and avoiding risks from competitors.
As the portfolio manager, you:
a. Worked with the component managers to ease the transition
b. Documented these decisions in portfolio reports
c. Set up both quantitative and qualitative metrics to determine the useful-
ness of adding resources to the other components
d. Met with the affected component managers and their teams to explain
these changes
100. Assume you are the portfolio manager for the Federal Railroad
Administration. Funding is provided annually according to the Government’s
budget process. Any monies that are not spent at the end of a scal year
are lost, and there are some restrictions in place concerning whether funds
can be transferred to different programs, projects, or operations work in the
agency. Therefore, to maximize the use of funding you require:
a. Regular reports on funds for authorized components
b. Projections on a quarterly basis as to the funds components require
c. Mechanisms for internal audits to ensure funds are allocated effectively
d. Accurate estimates of the funds needed when the component is proposed
for consideration
142 ◾ PfMP® Exam Practice Tests and Study Guide
101. Although you are the Portfolio Manager in your company, you also are the
Enterprise Program Ofce Director, and it consumes most of your time. Your
executive team has lost interest in regular portfolio review meetings, the few
that are held are routine, and any proposed component receives automatic
approval. The Executive Vice President for Human Resources spoke to the
CEO as she noticed some people seem to be completely overloaded, they
are actively looking for new opportunities, and are then leaving the com-
pany. She also pointed out that others seem to have idle time. Her com-
ments got the CEO’s attention, and you have been asked in your role as the
portfolio manager to create an up- to- date list of qualied components in
the portfolio. You are doing so in order to:
a. Have an accurate understanding as to how resources are allocated
b. Determine how best to use resource leveling on approved components
c. Identify, categorize, score, and rank components
d. Review the initial business cases for the components and assess their
validity in terms of strategic goals
102. Assume you are working to prepare the low- level schedule and timelines
for portfolio components. You want to make sure, as the portfolio manager,
for your country’s initiatives to promote an awareness of the importance of
climate change, that each component then can be monitored and tracked to
assess performance. To do so, you should:
a. Set up KPIs for each component that are consistent for ease of
measurement
b. Determine the critical success factors at the portfolio level and then
ensure each component contributes toward their realization
c. Review the portfolio roadmap
d. Review the portfolio performance plan
103. Specic types of communication technology that are used such as com-
munication media, record retention policies, and security information are
examples of:
a. Organizational process assets
b. Portfolio process assets
c. Items in the information distribution process
d. Items needed to cover the portfolio communications management plan
Practice Test 1 ◾ 143
104. Assume your Department can only pursue one of the ve possible compo-
nents listed below:
1 2
1 3 2 3
1 4 2 4
1 5 2 5 3 5 4 5
Based on the above data, you should select:
a. Component 5
b. Component 3
c. Component 2
d. Component 1
105. After a recent Portfolio Review Board, the portfolio was optimized, and
some components were added, while others were removed. Various portfo-
lio reports also require updates such as:
a. Affected organization areas
b. High- level time frame
c. Budget approvals or exceptions
d. Value/ benets
106. You have been a successful program manager for many years in your State
Department of Agriculture. During this time, you managed large programs,
and some had major risks to mitigate especially in the information systems
area as new software would be released that was commercially available, and
you knew it would then enhance the benets to your customers if you
acquired it. You were the rst in the Department to get your PfMP, and it
led to a promotion to become the rst portfolio manager. After a year in this
position, you nd managing risks and issues to be totally different because:
a. You must focus attention on external, political risks
b. You are concentrating more on long- term initiatives
c. Your focus is on determining the risk tolerances of stakeholders, both
internal and external
d. You emphasize strategic tness of the portfolio
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