GMS450 - MODULE 2 EXAM QUESTIONS AND ANSWERS
What is the process of evaluating projects and choosing them to meet firm
objectives?
Project selection.
What are some conditions considered during project selection?
Profitability, necessity, skills, and capacity.
How are projects selected based on qualitative and/or quantitative methods?
By applying multiple criteria until alignment with overall business strategy is achieved.
What are the categories into which projects can be classified?
Compliance, Emergency, Mission Critical, Operational, Strategic.
Which method of project selection does NOT use numbers for evaluation?
Sacred cow.
What is the "sacred cow" method of project selection?
Projects suggested by senior executives and approved regardless of feasibility.
What is the main drawback of the payback period method?
Ignores the time value of money + Ignores any returns beyond the payback period.
What does the Discounted Cash Flow method consider?
Time value of money + Inflation rate + Firm's return-on-investment
What is the process of evaluating projects and choosing them to meet firm
objectives?
Project selection.
What are some conditions considered during project selection?
Profitability, necessity, skills, and capacity.
How are projects selected based on qualitative and/or quantitative methods?
By applying multiple criteria until alignment with overall business strategy is achieved.
What are the categories into which projects can be classified?
Compliance, Emergency, Mission Critical, Operational, Strategic.
Which method of project selection does NOT use numbers for evaluation?
Sacred cow.
What is the "sacred cow" method of project selection?
Projects suggested by senior executives and approved regardless of feasibility.
What is the main drawback of the payback period method?
Ignores the time value of money + Ignores any returns beyond the payback period.
What does the Discounted Cash Flow method consider?
Time value of money + Inflation rate + Firm's return-on-investment
