144 ◾ PfMP® Exam Practice Tests and Study Guide
107. The Monitor Portfolio Value process, while ongoing, has proved to be suc-
cessful as you work to implement portfolio management. Within six months,
you were able to show the usefulness of a simple scoring model to the
Oversight Group, and they requested a more sophisticated approach in
which weights could be assigned to criteria. This shows:
a. An acceptance of portfolio management in the organization
b. The usefulness of the portfolio roadmap
c. A link between using scoring models and benets analysis
d. The importance of documenting lessons learned
108. Assume you are the portfolio manager for your cereal company, which has
diversied its product line signicantly in the last two years to keep up with
its leading competitor located in a different state. Your executive manage-
ment team learned the other cereal company had implemented portfolio
management from a contractor and believes it is essential since the economy
is struggling, and resources are constrained. Your rst step has been to iden-
tify the existing operational work, projects, and programs as well as to learn
about proposed components of the portfolio. This list:
a. Was easy to obtain as you used what was available from the Enterprise
Program Management Ofce
b. Is part of the portfolio strategic plan
c. Was gathered through interviews with people from each business unit
d. Was prepared through questionnaires and the use of cross- functional
focus groups
109. Assume you are a functional manager in your medical device company in
research and development. Your scientists have determined a new product
that will be a breakthrough for the company, and you want to serve as the
sponsor for this component and present it to your Portfolio Review Board.
You will need resources from other parts of the company to commercialize
it. As you prepare your proposal you are following the key descriptors set
up by the portfolio staff and will include:
a. Risk reduction
b. Regulatory and compliance issues
c. Internal and external dependencies
d. Qualitative benets
Practice Test 1 ◾ 145
110. Assume you work for a technology company that is publically owned, and the
value of its stock is tracked daily by the CFO and is reported to the portfolio
manager. Quarterly meetings are held with stockholders as the company went
public through an Initial public offering (IPO) last year. These stockholders:
a. Have different communications requirements than other stakeholders
b. Typically receive information as to the portfolio health before each meeting
c. Want to attend all Portfolio Review Board meetings
d. Are considered external stakeholders
111. Working to best optimize resource supply and demand in your telecom com-
pany, authorized components are prioritized to help in resource allocation.
This means as you work to do so, you need to review the portfolio because:
a. It provides guidance in terms of recommendations if there are changes in
strategy and resource availability
b. Resource requirements are balanced according to the resource pool
c. Components are not authorized unless resources are available to support
them
d. Sponsors assess resource requirements and their availability before pro-
posing a component to be in the portfolio
112. Working to prepare the portfolio performance management plan, assume
you have been involving others in the process to help secure their later sup-
port of the plan. You also reviewed historical information and other artifacts.
Not to be overlooked is a/an:
a. Benet schedule
b. Organization chart
c. Regulatory requirements
d. Governance model
113. For years, your aerospace company has been a leader in the development
of sophisticated avionic hardware systems around the world. The executives
want to continue with this well- recognized product line, but also they decided
it is time to move into state- of- the art software to complement the hardware
products. You have been asked to assess whether there are skill set limitations
in the company to assess resource capacity internally. To do so, you decide to:
a. Focus on needed competencies and develop competency proles for the
internal staff
b. Interview staff members based on performance evaluations to determine
their interest in the new product line
c. Work with Human Resources and review the education backgrounds of
internal staff and see if people have taken recent training
d. Set up a contingency plan by asking the Procurement Department to
issue a Request for Information to external consulting rms
146 ◾ PfMP® Exam Practice Tests and Study Guide
114. You are the CIO of a real estate investment trust (REIT) that invests in apart-
ments and condominiums in more than 50% of the states in your country.
Your organization has as its goal to respond to any concerns that arise
within 24 hours; for example, you want to make sure Wi- Fi sites are opera-
tional if there are any power outages, and people have soft phone service
available 24/7. You are a member of the REIT’s Portfolio Review Board, and
as a member of the executive team in terms of portfolio risk management,
you want to focus on:
a. Issues with product support
b. Identifying and managing liabilities
c. Interaction of component risks
d. Inconsistent processes
115. Assume at this point as the portfolio manager in your mattress company, you
are activating portfolio components, updating portfolio reports, and docu-
menting the decisions made at the recent Portfolio Governance Committee
meeting as the company moves into new markets. You are therefore:
a. Communicating decisions to all stakeholders
b. Maintaining a decision log from the Committee meeting
c. Updating the portfolio strategic plan
d. Authorizing the portfolio
116. As the portfolio manager, you must engage stakeholders and build and
maintain outstanding relationships with them as much as possible. After
identifying and classifying them, you want to make sure you provide the
specic information each stakeholder group requires. Therefore you prepare:
a. A communications strategy matrix
b. A communications matrix
c. A reporting frequency matrix
d. A stakeholder matrix
117. Assume your bank has decided to implement portfolio management. It
is starting with the business unit you lead, which is responsible for new
products, and then will set the stage to implement it throughout the bank,
including at the enterprise level. You have executive support and commit-
ment to implement it in your business unit. A key rst step is to:
a. Set up a governance structure
b. Dene roles and responsibilities for implementation
c. Prepare a portfolio performance plan
d. Prioritize the work to be done
Practice Test 1 ◾ 147
118. Assume you are the portfolio manager for your pork producing company,
the market leader in your country. Over time, the industry has recovered
from trichinosis as a risk. Your company has added new components to its
portfolio, and many have been to demonstrate to the public that its prod-
ucts are safe. It implemented the Agriculture Department’s and Food and
Drug Administration’s Hazard Analysis and Critical Control Point (HACCP)
regulations and is enhancing its image as ‘the other white meat’. However,
now the entire industry is faced with a new epidemic known as porcine
epidemic virus, which is affecting pigs in 22 different states, and prots have
decreased signicantly. New components now must be added to the portfo-
lio. This situation shows:
a. Resource re- allocation is required
b. Risk management is essential
c. The ROI of the new components must be determined
d. Portfolio rebalancing has led to the new components being in the top
ve priority list
119. Assume as the portfolio manager you have conducted a stakeholder analysis,
gap analysis, and a readiness analysis as your cereal company is now enter-
ing the ice cream market. A team was formed and located off site to deter-
mine whether this market was one in which your company could compete,
and its recommendation to do so was accepted by the Portfolio Review
Board. Now you need to:
a. Acquire resources to support the new line of ice cream products
b. Change the prioritization model
c. Develop a communications strategy for use internally and also externally
d. Set completely new performance metrics for all products
120. Working to monitor the portfolio especially in terms of its value to the
organization, you had each component manager prepare monthly variance
reports. Of the components ranked in the top 10, six of them realized they
would not require some of their initial funding and still would be completed
as planned. This means:
a. Three- point estimating should be used as funds are allocated
b. Next year’s budget can be adjusted
c. Historical data would be useful on estimates versus actual costs
d. The amount of contingency and management reserves can be decreased
148 ◾ PfMP® Exam Practice Tests and Study Guide
121. As you prepare your communications management plan you realize that
stakeholder requirements may change over time, and these changes then
will need to be reected in updates to the plan. As the plan denes the
overall communication process not only for gathering information but also
in determining recipients of it, it also:
a. Sets expectations for the project team members
b. Describes how and when to effectively conduct lessons learned meetings
c. Ensures continued condence by all stakeholder groups as to their
importance
d. Sets expectations for effective stakeholder engagement
122. In your telecom company, a number of criteria must be considered as you
develop your approach to prioritize components in the portfolio. Your man-
agement insists that to be competitive the products must be rst to market
or the window of opportunity is lost with the result being not only lost rev-
enues but also lost productivity. Another criterion to consider is:
a. External dependencies
b. Goals and objectives
c. Customers
d. Regulatory compliance
123. Different types of risks affect the portfolio, and they may be positive or
negative. As the portfolio manager, one has to maximize the opportunities
and minimize the threats. An example of a negative portfolio risk is:
a. External participants who are highly specialized
b. Integrated systems
c. A large number of concurrent programs and projects
d. Full- cost estimates for programs and projects
124. In your architectural organization, each program or project requires some
specialized subject matter experts at certain time frames. Because of the
interdependencies between components, often these SMEs are needed at the
same time. Assume since this is a critical issue in the company, it invested in
resource planning and allocating software, and dashboards can be prepared.
The goal is to use these dashboard reports to:
a. Determine whether to use external consultants
b. Assess specic costs for additional budget
c. Ensure everyone has access to the software for ease of communication
d. Assist in scheduling adjustments
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