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Project Management: Planning, Execution, Evaluation and Control

Assignment- 6
TYPE OF QUESTION: MCQ
Number of questions: 15 Total mark: 14 X 1 = 14
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QUESTION 1:
The most common method for shortening activity durations involves the decision to:

a. Eliminate bureaucracy.
b. Alter the technology used in the activity.
c. Assign more senior personnel to the activity.
d. Increase project resources.

Correct Answer: d

Justification: The most common method for shortening activity durations is to increase project
resources. By adding more resources to an activity, you can often complete it more quickly,
assuming the additional resources can be effectively utilized.

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QUESTION 2:
An activity performed by a subcontractor is scheduled for 20 weeks at an anticipated cost of $100,000.
Due to slippage on the critical path you need to reduce this activity by three weeks. If the subcontractor
informs you that the activity can be completed in 16 weeks for $200,000, what is the slope for the
activity?

a. $5,000 per week

b. $33,333 per week
c. $25,000 per week
d. $12,500 per week

Correct Answer: c
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Justification:

To find the slope for the activity, you need to determine the additional cost per week saved. The
slope is calculated as:
Determine the additional cost for reducing the activity duration from 20 weeks to 16 weeks:

Original cost for 20 weeks: $100,000

New cost for 16 weeks: $200,000
Additional cost for 4 weeks reduction: $200,000 - $100,000 = $100,000
Calculate the slope:

Reduction in duration: 4 weeks

Additional cost: $100,000
Slope = Additional cost / Reduction in duration
Slope = $100,000 / 4 weeks = $25,000 per week
So, the correct answer is c. $25,000 per week.
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QUESTION 3:
Use the information in the table (all times are in days) to determine the lowest cost minimum completion
time if the base cost for each activity finished in normal time is $1,000.

Normal Minimum Crash Cost

Activity Time Time ($/day) Predecessor
A 10 6 $70 --
B 6 3 $40 --
C 2 2 -- B
D 4 2 $60 C
E 6 4 $80 A
F 8 5 $90 D, E

a. $7,120
b. $6,910
c. $6,790
d. $6,830

Correct Answer: c

Justification:
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Please see below:

Calculate the base cost for each activity if they are completed in normal time.
Each activity costs $1,000 if finished in normal time.
Total base cost = Number of activities × $1,000
Total base cost = 6 × $1,000 = $6,000

Draw the network, compute critical path, and crash critical activity with least cost slope as
shown below:

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Answer Question 4-6 with the information given below

Consider the following work breakdown structure:

Crashing Cost
(in '000)
Normal Time Subsequent
Activity Succeeds 1st Week
(wks) Week
Start A, B - - -
A C, D 6 8 -
B G 4 5 6
C E 4 - -
D F 5 6 6
E H 6 8 8
F H 6 7 10
G I 8 3 5
H End 5 12 15
I End 6 5 -

QUESTION 4:

In crashing this project, which activity should be the first to be reduced?

a. A
b. B
c. D
d. E
e. F

Correct Answer: c

Justification:

D is the most economical critical path activity to crash, as A costs $8,000, D costs $6,000, F
costs $7,000, and H costs $12,000.
(Further see below)
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QUESTION 5:
What is the total cost of reducing this project by two weeks?

a. 10,000
b. 12,000
c. 14,000
d. 16,000
e. 18,000

Correct Answer: c

Justification: Refer to the solution Q4 above.

Add together the cost of crashing A and D by one week each. Total cost = $14,000.

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QUESTION 6:

What is the total cost of reducing this project to 18 weeks?

a. 28,000
b. 30,000
c. 35,000
d. 40,000
e. 45,000

Correct Answer: d

Justification: Refer to the solution Q4 above and also below:

Cost are in (‘000)

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QUESTION 7:
Jim receives the following information on his project: PV = 1000, EV = 1200, AC = 800, BAC = 2000,
EAC = 1333. How is the project doing in terms of schedule?
a. More work has been done than planned
b. Less work has been done than planned
c. The same amount of work has been done than planned
d. The project has cost less than planned
e. There is not enough information to draw a conclusion

Correct Answer: a

Justification:

To assess how the project is doing in terms of schedule, compare the Planned Value (PV) and
Earned Value (EV):

Planned Value (PV) = 1000, Earned Value (EV) = 1200

Since EV (1200) is greater than PV (1000), more work has been completed than was originally
planned at this point in time.
Thus, the project is doing better in terms of schedule. The correct answer is a. More work has
been done than planned.
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Answer Question 8-14 with the information given below

Use the following table for Project Alpha.

Activity 7 14 21 28 35 42 49 Plan % Complete

Install fixtures 325 250 575 100%
Refinish floors 550 85 635 100%
Replace doors 350 275 625 100%
Complete tiling 1,200 565 1,765 80%
Install back door 875 225 1,100 70%
Landscaping 200 350 550 25%
Monthly Plan 325 800 435 1,475 1,440 425 350 5,250
Monthly Act 550 550 550 1,100 1,650 550 1,100
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QUESTION 8:
Determine the earned value at week 49 (Consider the nearest value)
a. $4,950
b. $6,050
c. $4,155
d. $5,250

Correct Answer: c

Justification:

Calculate the earned value (EV) for each activity:

Install fixtures: $575 (100% of $575)

Refinish floors: $635 (100% of $635)
Replace doors: $625 (100% of $625)
Complete tiling: 80% of $1,765 = $1,412
Install back door: 70% of $1,100 = $770
Landscaping: 25% of $550 = $137.50

Total EV = $575 + $635 + $625 + $1,412 + $770 + $137.50 = $4,155

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QUESTION 9:
Determine the schedule variance (SV) at the end of 49 weeks (Consider the nearest value)
a. -$1,896
b. -$1,096
c. -$800
d. -$206

Correct Answer: b
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Justification:

To determine the schedule variance (SV) at the end of 49 weeks, follow these steps:
Calculate the Planned Value (PV) at week 49:
PV is the cumulative planned value of work scheduled up to week 49.
From the monthly plan: $325 + $800 + $435 + $1,475 + $1,440 + $425 + $350 = $5,250
Calculate the Earned Value (EV) at week 49:
From the previous calculation, EV at week 49 is $4,155.
Calculate the Schedule Variance (SV):
SV = EV - PV
SV = $4,155 - $5,250 = -$1,095

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QUESTION 10:
Determine the schedule performance index(SPI) at the end of 49 weeks (Consider the nearest value)

a. 1.46
b. 0.68
c. 0.79
d. 1.26

Correct Answer: c

Justification:

To determine the Schedule Performance Index (SPI) at the end of 49 weeks, follow these steps:
Calculate the Planned Value (PV) at week 49:
From the monthly plan: $325 + $800 + $435 + $1,475 + $1,440 + $425 + $350 = $5,250
Calculate the Earned Value (EV) at week 49:
From the previous calculation: EV = $4,155
Calculate the Schedule Performance Index (SPI):
SPI = EV / PV
SPI = $4,155 / $5,250 = 0.790
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QUESTION 11:
Determine the estimated cost to completion at the end of 49 weeks (Consider the nearest value)

a. $4,285
b. $5,250
c. $6,050
d. $7,645
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Correct Answer: d

Justification:

Estimated cost at completion (EAC) = Budgeted cost of completion (BAC) / Cost performance
index (CPI)
CPI = Earned value (EV)/Actual cost (AC)
EAC = 5250/0.6866 = $7,645
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QUESTION 12:
Determine the estimated cost variance at the end of 49 weeks (Consider the nearest value)

a. -2395
b. -2746
c. -1875
d. -2186

Correct Answer: a

Justification:

Cost variance = BAC – EAC = 5250-7645 = - 2395

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QUESTION 13:
Determine the cost performance index at the end of 49 weeks (Consider the nearest value)

a. 0.597
b. 0.686
c. 0.744
d. 0.974

Correct Answer: b

Justification:

Cost performance index (CPI) = Earned value (EV)/Actual cost (AC) = 4155/6050 = 0.686
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QUESTION 14:
Determine the estimated time of completion of the project at the end of 49 weeks (Consider the nearest
value)

a. 56.5
b. 61.9
c. 64.4
d. 67.6

Correct Answer: b

Justification:

Estimated time to complete = Original planned duration to complete/Scheduled performance

index (SPI) = 49/0.790 = 61.9
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