Practice Test 2 ◾ 215
32. You are the portfolio manager for the Department of Education and report
to the Department’s Secretary. She chairs a Portfolio Review Board, which
meets quarterly, but you provide monthly reports to her and the other Board
members on the portfolio’s performance, and often ad hoc meetings of the
Board are held after they read these reports. The purpose is to provide feed-
back that then:
a. Program and project managers can use to ensure their work remains in
strategic alignment
b. May cause the other Board members representing the different units in
the Department to rebalance their portfolios
c. Lead to the potential change of the Department’s strategic direction
d. Provide awareness of potential internal and external impacts to
Departmental goals
33. Two years ago, your University set up an Enterprise Program Management
Ofce (EPMO) for its programs and projects. It now has repeatable processes
in place, and the programs and projects are able to be completed within the
allotted budget. However, the Dean of Graduate Studies recently has con-
vinced the Chancellor the University needs to offer two additional doctoral
degrees and a campus should be established in China. The Chancellor then
met with the EPMO Director and decided to set up a separate portfolio
ofce. You applied for this position and were selected. You are preparing
your portfolio strategic plan. You know it is a best practice to include in it the:
a. Organizational communication strategy
b. Expected timelines
c. Methods to optimize the portfolio
d. Governance model
34. Assume a new Chief Financial Ofcer just joined your company. You are
the portfolio manager, and he will be a member of the company’s Portfolio
Review Board. He will attend his rst Board meeting in one week and asks
you about the approach that is used to manage the portfolio to meet the
corporate strategies. Your next step is to:
a. Ask for a meeting to explain how portfolio management is practiced in
the company
b. Provide a copy of the portfolio management plan
c. Provide a copy of the portfolio strategic plan
d. Provide a copy of the Board’s decision register
216 ◾ PfMP® Exam Practice Tests and Study Guide
35. Change is constant in your telecommunications company because of con-
sumer demand for new features in your products, competition, and regula-
tory requirements from the Federal Communications Commission. As the
portfolio manager, you are the lead in managing the strategic changes that
do occur. One item to review or update in this process is:
a. The composition of the Portfolio Review Board
b. Reports and other data provided to the Board for their consideration as
they revise the mix of components
c. The original portfolio charter
d. The prioritization analysis methodology
36. Setting up and implementing portfolio management is difcult regardless of
the size of the organization. Further, many organizations have multiple port-
folios at different levels. An underlying principle of portfolio management is
to focus on strategic initiatives. In doing so in planning, a best practice is to:
a. Involve as many stakeholders as possible
b. Follow a strategic mandate
c. Balance conicting demands relative to programs and projects
d. Manage necessary changes
37. In determining the list of portfolio components that best aligns with organi-
zational strategy, one approach is to use capacity analysis. This approach is
especially useful when there are internal constraints. Assume your organiza-
tion has decided to move into a management- by- projects environment and
trained its engineering, manufacturing, and IT staff in a variety of project
management techniques including how to develop a WBS, project plan,
quality plan, and risk management plan. You have been asked as a consul-
tant to assess the organization’s ability to pursue projects that cross func-
tional disciplines. You recommend:
a. Use of external resources
b. Mentoring and job shadowing
c. Determining constraints from capabilities
d. Use of the trained internal resources
Practice Test 2 ◾ 217
38. Assume you are working for a University that offers a masters degree in
project management. While it was one of the rst Universities in your coun-
try to offer this degree, now about 75 other Universities are offering degrees
or certicate programs. Your University requires that all courses be taken on
campus; it does not have a distance learning program. As a result, enroll-
ments have decreased even though it is a quality program. The decreasing
enrollments now are viewed as a negative risk to continue the program at
the University. You are assigned as the risk owner and are analyzing this risk
through probability and impact. You should:
a. Discuss with the Portfolio Review Board that unless an on- line compo-
nent can be added, enrollments will continue to decrease
b. Use the probability and impact ratings as stated in the portfolio risk man-
agement plan
c. Note that if tuition costs are decreased, enrollments will stabilize
d. Complement the probability/ impact analysis with sensitivity analysis
before making recommendations
39. Assume your Portfolio Review Board completed its analysis of the existing
components in the portfolio and decided to terminate a new product for a
new stent to assist heart patients. At the time it was approved, its features
far surpassed any on the market, and it seemed since safety and quality are
the key priorities, regulatory approval time would be minimal. However the
Center for Devices in the Food and Drug Administration found a major aw
in your company’s product, and now a competitor has a comparable prod-
uct on the market. As the portfolio manager, it is your responsibility now
to notify the program manager and team that the program is canceled, and
most will lose their jobs as a result. In this situation, your best course of
action is to:
a. Make sure the people involved know the decision was one the organiza-
tion’s executives made as members of the Portfolio Review Board
b. Let the team know the termination is due to the competition being rst
to market
c. Use the human resources person on the Portfolio Review Board and ask
him to navigate the negative impact on the people involved
d. Personally offer assistance to anyone on the team in locating work and
provide references stating why the project was terminated
218 ◾ PfMP® Exam Practice Tests and Study Guide
40. Assume you want to assess the efciency in terms of the actual costs of the
various resources working on components in your portfolio. You have set up
a report to show the time and cost for people working on components since
they tend to work on multiple programs and projects. One approach to use
is to prepare:
a. A histogram
b. A funnel chart
c. A productivity index
d. A key performance indicator
41. Your organization is reviewing its strategic goals and objectives as well
as the prioritization criteria used for portfolio decisions. The Chair of the
Portfolio Review Board now is requesting that each existing component
and proposed components be evaluated to determine how they support
customer satisfaction, increasing revenue, attracting new customers, and the
degree of strategic alignment. This approach means:
a. Components must support one of these four areas
b. Components will be terminated if they do not support one of these areas
c. Components may support more than one of these areas
d. The existing portfolio scoring model will not be needed
42. Assume you are preparing reports on the status of the portfolio. After con-
ducting your communications analysis, you learned your key stakeholders
wanted a graphical report that showed a variety of information on a single
page. They were interested in schedule status, issues and risks, and nancial
information so you decided to:
a. Set up a trafc light report in these areas
b. Use a quadrant report with these items representing overall success
c. Use a dashboard with summary information in these areas
d. Determine KPIs for each area and then prepare a quadrant report
Practice Test 2 ◾ 219
43. Assume you work as the portfolio manager for a company specializing in
food additives. A component is to develop an additive to reduce obesity and
still enable people to eat as much ice cream and chocolate as they want.
However, a competitor just released a similar additive. Your Portfolio Review
Board is holding an ad hoc meeting to determine next steps. You had identi-
ed this possibility as a potential risk. You worked with the risk owner and
determined the size of the investment in this component to date. You then
decided the best approach was to accept this risk in an active way, which
the Portfolio Review Board supported. This means:
a. You will go ahead as planned with this component
b. You will get approval to add more resources to complete the product
development as quickly as possible
c. You will decide to terminate further work given the low level of invest-
ment and sunk costs to date
d. You will use your contingency reserve and work aggressively to complete
the component
44. Your company is using mergers and acquisitions as a means of entering new
markets in the food additive area as well as eliminating competition from
existing products. As the portfolio manager, it seems that you are consumed
by change and are constantly rebalancing the portfolio. As you do so, you
need to maximize portfolio return according to the company’s:
a. Strategic goals
b. Available resources
c. Available assets or technology
d. Desired risk prole
45. Different organizations have different denitions for vision, mission, and
values. However, portfolio, program, and project management are the way
an organization best can manage the capability to deliver value, which then
is realized through:
a. Customer relationship management
b. End user satisfaction
c. Day- to- day processes
d. Benet sustainment
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