PMP Exam Practice Questions - Lecture Notes

Introduction

• Purpose: Practice PMP exam questions with five examples.
• Goal: Enhance preparation and check knowledge readiness.
• Performance Indicator: Aim for 80% on practice exams to be well-prepared for the real exam.

Question 1: Project Investment Decision

• Scenario: Decide which project is a better investment.
• Options:
  • Project X: 3 years, NPV $125,000.
  • Project Y: 2 years, NPV $100,000.
• Key Point: NPV already considers the time period.
• Answer: Choose Project X for its higher NPV of $125,000.
• Takeaway: Focus on the highest NPV for investment decisions.

Question 2: Ethics and Guidance

• Scenario: As a certified PMP, guide a colleague preparing for the PMP exam.
• Options:
  • Give instructions and let them figure out the rest.
  • Say you’re too busy.
  • Provide guidance based on experience.
  • Refer them to the PMI website.
• Answer: Provide guidance based on your experience.
• Takeaway: It's part of PMP responsibility to mentor and guide aspiring professionals.

Question 3: Cost Performance Index (CPI) Calculation

• Scenario: Calculate CPI with given project values.
• Values:
  • Present Value (PV): $795,000
  • Earned Value (EV): $850,000
  • Actual Cost (AC): $950,000
• CPI Formula: CPI = EV / AC
• Calculation: CPI = $850,000 / $950,000 = 0.89
• Answer: CPI of 0.89 indicates over budget (less than 1 means over budget).
• Takeaway: Know the CPI formula. Less than 1 means over budget.

Question 4: Return on Investment (ROI)

• Scenario: Calculate ROI for a project.
• Project Details:
  • Cost: $200,000
  • Benefit: $240,000
• Calculation:
  • Net Income: $240,000 - $200,000 = $40,000
  • ROI Formula: ROI = (Net Income / Cost) x 100 = 20%
• Answer: ROI is 20%.
• Takeaway: ROI calculated as net income divided by cost.

Question 5: Benefit-Cost Ratio (BCR)

• Scenario: Recommend a project based on Benefit-Cost Ratios.
• Options:
  • Highest BCR is preferred.
  • Example BCRs given, choose the highest.
• Answer: Choose the project with a BCR of 2.05.
• Takeaway: For BCR, higher is better. Know that higher ratios indicate better cost-benefit efficiency.

Conclusion

• Regular practice is key to passing the PMP exam.
• Aim for understanding and applying key concepts like NPV, CPI, ROI, and BCR.
• Continue practicing to improve confidence and exam readiness.