Instructions:
Be sure to show all work in Excel as appropriate-DO NOT put Excel or CB derived answers in MS Word-that does not show the work you did to produce your answers (Points will be deducted if you just give the answers without showing the work, even if the answers are correct). For CB output, you should paste the forecast output in your Excel setup file. Show split view in all CB output. Analyze/Interpret your CB results.
Part 1: The first part will carry a weight of 50% of the total grade.
1. Which of the following can be included in scoring models for selecting projects?
a) potential profitability of the project
b) potential impact on the firm's competitive position
c) the organization's ability to market the output of a project
d) All of the above can be included
e) only a and b above
2. If the initial investment in a project is $100,000 and the expected annual net profit for the project is $20,000, the payback period is:
a) 5 years
b) 4 years
c) One fifth of a year
d) 10 years
e) insufficient information to determine the payback period
3. Which of the following is NOT a characteristic of a project?
a) They are unique.
b) They are routine.
c) They have specific due date.
d) They have a specific deliverable.
e) They have a purpose.
4. The project manager is responsible to:
a) the parent organization
b) the project team
c) the project's client
d) the project manager's immediate supervisor
e) all of the above
5. What is the primary purpose of creating a work breakdown structure?
a) to draw the project plan as a chart or tree
b) to make sure important tasks aren't overlooked
c) so that all team members can see what others are working on
d) to assign budget numbers to tasks
e) to identify important precedence relationships
6. Which of the following is used to show linkages between people and tasks?
a) the Work Breakdown Structure
b) the RACI Matrix
c) the Project Action Plan
d) the Project Resource Diagram
e) the Concurrent Engineering Chart
7. Which of the following is NOT a sub-process associated with risk management?
a) risk identification
b) risk measurement
c) qualitative risk analysis
d) quantitative risk analysis
e) risk response planning
8. Which of the following is NOT true regarding top-down budgeting?
a) It is based on the collective judgments of top and middle managers.
b) Overall project costs are estimated by top and middle managers and then passed on
c) to the next lower level.
d) The overall budget cost is generally not very accurate.
e) Overlooking small but important tasks can lead to a serious budgetary problem.
f) All of the above are true concerning top-down budgeting.
9. Which of the following is NOT an element of the Gantt chart?
a) actual progress
b) variance of the critical path
c) the current date
d) scheduled milestones
e) all of the above are elements
10. Which of the following is typically used as the best estimate of task duration?
a) expected time
b) pessimistic time
c) optimistic time
d) most likely time
e) none of the above
11. In MS Project, in order to set a deadline for a particular task, which of the following is the proper sequence from the Task Information dialog box?
a) General > Percent Complete
b) Resources > Assignment Owner
c) Advanced tab > Calendar
d) Advanced tab > Deadline
12. Why is it necessary to consider the learning curve of resources on a project?
a) to estimate labor costs properly
b) to improve project team morale
c) because it always takes less time to do a task after someone has done it a few times
d) collective bargaining contracts require it
e) All of the above
13. The name given to the budget process that aggregates income and expenditures across projects is:
a) activity-oriented budget
b) top-down budget
c) bottom-up budget
d) program-oriented budget
e) activity-based costing
14. Which of the following linkages is used to start two or more activities at the same time?
a) finish-to-start
b) start-to-start
c) finish-to-finish
d) start-to-finish
e) They can all be used to start two or more activities at the same time
15. Altering the specifications of an ongoing project is referred to as
a) suboptimization
b) scope creep
c) a virtual project
d) projectitis
e) PMT
16. During project formation stage, the major sources of conflict are all of the following except:
a) Priorities
b) Procedures
c) Technical
d) Schedules
17. The first unit produced by a manufacturer required 6 hours. If the industry uses a 90 percent learning rate, how long should the fourth unit take?
18. Because project budgeting is for a special case and the organization's budgeting process is for routine work, the project manager need NOT be familiar with the organization's accounting system. (True/False)?
19. The Major Deliverables section in Project Charter describe the details of the work packages in the work breakdown structure (True/False)
20. A disadvantage of using the discounted cash flow method (or net present value) for selecting projects is that it ignores all non-monetary factors associated with the project. (True/False)?
21. If task duration estimates are carefully made, the project manager needs to only examine the critical path when conducting a risk analysis. (True/False)?
22. The actual project duration will be known with certainty after the project is completed. (True/False)?
23. In MS Project, what is the difference between the Resource column on the WBS (including personnel needed by the project) and the Assigned To column? (no more than 100 words).
24. Contrast the project plan and the work breakdown structure. (no more than 100 words).
25. When activity times are known with certainty, the critical path is defined as the set of activities on a path from the project's start event to its finish event that, if delayed, will delay the completion date of the project. Why must this definition be modified in situations where the activity times are not known with certainty? Are there dangers associated with not modifying the definition? (not more than 150 words).
Part II
1. You have a network with a critical path A-B-C-D. The values for optimistic (a), pessimistic
|
Task
|
a
|
m |
b
|
Te |
Var |
|
A
|
6
|
8 |
12
|
|
|
|
B
|
3
|
4 |
6
|
|
|
|
C
|
3
|
9 |
12
|
|
|
|
D
|
5
|
5 |
7
|
|
|
a. What is the value of g for the network?
b. What is the value of c71,2 for the network?
c. What is the probability that this network can be finished within 27 days?
2. Two investments (A and B, below) have been proposed to the Capital Investment committee of your organization;
a. The required rate of return for your company is 6%. What is the NPV for each investment?
b. What is the payback period for each investment?
c. Which investment would you recommend and why?
|
Investment A
|
Year 0 |
Year 1
|
Year 2
|
Year 3
|
Year 4
|
Year 5
|
|
Required Rate of Return
|
|
|
|
|
|
|
|
Costs:
|
$ 150,000
|
$ 10,000 |
$10,000
|
$ 10,000
|
$ 10,000
|
$ 10,000
|
|
Benefits:
|
|
$ 90,000
|
$55,000
|
$35,000
|
$ 20,000
|
$ 20,000
|
|
Investment B
|
Year 0 |
Year 1 |
Year 2 |
Year 3 |
Year 4 |
Year 5 |
|
Required Rate of Return
|
|
|
|
|
|
|
|
Costs:
|
$ 80,000
|
|
|
|
|
|
|
Benefits:
|
$ -
|
$ 45,000
|
$15,000
|
$10,000
|
$ 10,000
|
$ 15,000
|
Unfortunately, the Capital Investment Committee refused to approve your recommendation (from above) since you did not consider the uncertainty inherent in these types of investments. Repeat your analysis, this time using Crystal Ball and the following information. What is the probability of meeting the NPV for the investments?
Investment A:
i. Year 0 Investment cost: Triangular distribution (optimistic: $125,000; most likely: $150,000; pessimistic: $175,000)
ii. Year 1-5 operating cost: Normal distribution (mean of $10,000, standard deviation of $2,000)
iii. Year 1 Benefits: Normal distribution (mean of $90,000, standard deviation of $20,000)
iv. Year 2 Benefits: Normal distribution (mean of $55,000, standard deviation of $15,000)
v. Year 3 Benefits: Normal distribution (mean of $35,000, standard deviation of $10,000)
vi. Year 4 Benefits: Normal distribution (mean of $20,000, standard deviation of $5000)
vii. Year 5 Benefits: Normal distribution (mean of $20,000, standard deviation of $5000)
Investment B:
i. Year 0 Investment cost: Triangular distribution (optimistic: $75,000; most likely: $80,000; pessimistic: $95,000)ii. Year 1 Benefits: Normal distribution (mean of $45,000, standard deviation of $20,000)
iii. Year 2 Benefits: Normal distribution (mean of $15,000, standard deviation of $5,000)
iv. Year 3 Benefits: Normal distribution (mean of $10,000, standard deviation of $3,000)
v. Year 4 Benefits: Normal distribution (mean of $10,000, standard deviation of $3,000)
vi. Year 5 Benefits: Normal distribution (mean of $15,000, standard deviation of $5,000)
3. From the week 4 Reading List by Mallak, Kurstedt and Patzak, "Planning for Crises in Project Management" (found in eReserves), would each of the four tools (Table 1) be of use in project management in general? How might each be used?
4. Answer the following using MS Project. You are in charge of the remodeling project for the kitchen and lunchroom at your office. Your facilities manager has just provided you with the resource pay rates for this project. You need to enter these pay rates in the project schedule.
i. Open the MSP file attached to the Mid Term.
ii. Select the Resource Sheet view
iii. For the Drywall resource, click the Type field drop-down arrow, Select Material, then press tab. For the Nails resource, click the Type field drop-down arrow, select Material, then press tab.
iv. In the Resource sheet, click the Std. Rate field for resource 1, Toby Nixon.
v. Key 500/w and press Enter.
vi. Enter the following standard pay rates for the remaining resources:
|
Resource Name
|
Standard Rate
|
|
Lori Kane
|
500/w
|
|
Run Liu
|
20/h
|
|
Electrician
|
30/h
|
|
Plumber
|
30/h
|
|
Drywall
|
11
|
|
Nails
|
5
|
|
John Emory
|
450/w
|
|
Scaffolding
|
50/d
|
|
Table saw
|
35/d
|
Now, you are to determine project COST for the Office Remodel. After entering all values in Resource Sheet, go to Gantt View and Insert 100% complete for each task as your final step. The actual cost will appear in the Gantt view of your finished MSP.
Post the resulting MSP file with your answer sheet. Include your name in the file (ie, "Smith Remodel 2-2.mpp"). Be sure to submit your answer as an MS Project file.
5. Given the information in the following table, draw the AOA network. Using the same information, enter the data into MSP assuming a 7-day workweek. (To change the calendar in MSP from its 5-day week default click "Help," type "calendar change," and follow directions.). Complete the following questions:
a. Develop the appropriate AON network and Gantt chart.
b. Find the critical path and critical time for the network.
c. Then find the slack for all activities.
|
Activity
|
Predecessor
|
Duration (days)
|
|
a
|
-
|
5
|
|
b
|
-
|
7
|
|
c
|
- |
4
|
|
d
|
a
|
6
|
|
e
|
b
|
9
|
|
f
|
b
|
6
|
g
|
c
|
4
|
|
h
|
d, e
|
6
|
|
i
|
d,e
|
8
|
|
J
|
f,g,h
|
9
|
|
k
|
i
|
10
|
|
l
|
j |
9 |