The following risk has been recorded in the risk register:
"As the singer is new to the market, there is a threat that the music album sales will not exceed the production costs, which would result in the project no longer being viable".
The record company plans to find an alternative graphic design company, to lower the overall production costs.
Which risk response is being applied, and why?
a) 'Transfer the risk', because using a cheaper company transfers the threat to the third party.
b) 'Transfer the risk', because using a cheaper company reduces the financial impact on the project.
c) 'Reduce a threat', because the threat is being made certain by increasing the probability of it occurring.
d) 'Reduce a threat', because the threat is being made less likely to occur and would have less impact.
A stage-level exception was identified while recording the sample songs. As a result, the project board instructed the project manager to prematurely close the stage and create a plan to combine the remainder of stage 2 together with the production of the 'recorded album' and the 'artwork'.
Which activity should the project manager carry out in order to produce the combined plan?
a) Plan the next management stage.
b) Prepare premature closure.
c) Produce an exception plan.
d) Create the project plan.
The 'artwork' will be delivered by a graphic design company using an agile delivery approach. The work package is being negotiated before work on the 'artwork' commences.
Who should approve the work package for the 'artwork'?
a) Project assurance.
b) Project manager.
c) Team manager.
The product description for the 'launch event plan' was updated at the end of stage 3 to include more detailed quality criteria. The 'launch event plan' was created during stage 4. The 'launch event plan' was then approved by the project manager after checking that it met the defined quality criteria.
Is this an appropriate way to manage quality, and why?
a) Yes, because the project manager should ensure that the quality controls for the 'launch event plan' will meet the defined quality criteria.
b) Yes, because the project manager should ensure that product descriptions are updated when planning the next stage.
c) No, because it is the senior user who should confirm the customer quality expectations and acceptance criteria for the project.
d) No, because it is the senior user who should provide resources to review and approve the 'launch event plan' according to the defined quality criteria.
Here are three statements that are considered when planning the Music Album Project. Which step in PRINCE2's recommended approach to planning do they apply to?
Choose only one step for each statement. Each step can be used once, more than once, or not at all.
The dependency between 'recorded sample songs' and 'signed contract' should first be identified.
a) Designing a plan.
b) Defining and analyzing the products.
c) Identifying activities and dependencies.
d) Preparing estimates.
e) Preparing a schedule.
f) Documenting a plan.
The work package to create the 'artwork' will commence in stage 3. The graphic design company uses their own development method to deliver products.
They have appointed their Graphic Designer as the team manager to complete this work package. The project manager will review the appointment at the end of the stage.
Which principle is being applied by the review, and why?
a) 'Manage by stages', because the project manager reviews the contents of the project initiation documentation when planning stage 4.
b) 'Manage by stages', because the project manager reviews the status of stage 3 products at the end of the stage.
c) 'Manage by exception', because the project board delegates the authority to the project manager on a stage-by-stage basis.
d) 'Manage by exception', because the team manager's performance should be reviewed before authorizing the next work package.
The executive has appointed the company's finance manager to provide business assurance, to monitor whether the album sales will exceed the production costs as the project progresses through each stage.
How well does this apply the 'manage by exception' principle, and why?
a) It applies it well, because the executive needs to be confident that controls and tolerances are being implemented effectively.
b) It applies it well, because a PRINCE2 project should structure the project into management stages to enable approval on a stage-by-stage basis.
c) It applies it poorly, because roles should be combined in a small project as long as there is no conflict of interest.
d) It applies it poorly, because a PRINCE2 project should focus on delivering quality outputs rather than on the work required to deliver the products.
The Music Album Project is part of a programme to contract new singers. The 'artwork' is being produced by an external graphic designer. The graphic designer's profit has been documented in the record company's business case.
Is this appropriate, and why?
a) Yes, because project costs should be recorded as part of the project's business case.
b) Yes, because the project's business case should record any benefits for the project's stakeholder.
c) No, because the project, as part of a programme, should be provided with the approach to the business case.
d) No, because the graphic designer's business justification should not be part of the project's business case.
During the initiation stage, a risk was recorded that sales of the singer's album might impact sales of other albums produced by the record company.
Therefore, when this risk was reviewed during project closure, a follow-on action recommendation was made for the record company's audit department to report on the impact during post-project benefit reviews.
Is this appropriate, and why?
a) Yes, because the project cannot be closed until the impact from sales are measured.
b) Yes, because the follow-on action will enable this risk to be closed in the risk register.
c) No, because a follow-on action should be addressed to an individual rather than a department.
d) No, because the benefits management approach should include post-project activities.
The recording studio has carried out improvements and can now deliver recordings to a higher quality than specified in the product description for the 'recorded album'.
The Recording Studio Manager has recorded the songs to the new improved standard, at no additional cost. This change has no other impact on the project.
How should the project manager categorize this issue, and why?
a) As an off-specification, because the recording of the songs will not fulfil the criteria specified.
b) As a request for change, because the product description will need to be updated.
c) As a request for change, because the recording will be of better quality.
d) As an off-specification, because a proposal to change a baseline has been received.