L6M5 EXAM QUESTIONS AND ANSWERS
Acceptance criteria - Answers - This must be met before the programme is accepted as
complete by the customer, for example, performance requirements and essential
conditions
Activity schedule - Answers - A list of activities which is agreed by the client and
contractor that trigger payments during the course of a programme
Adjudication - Answers - A dispute resolution process where the adjudicator's decision is
temporarily binding until finally determined by settlement, litigation or arbitration
Arbitration - Answers - When an independent third party is appointed by the contracting
parties to make a binding decision that will settle a dispute between the contracting
parties
Attitudes - Answers - Readiness or tendency to respond in a particular way to a given
situation
Average rate of return - Answers - A ratio which looks at the return on investment
spread over a number of years
Baseline - Answers - The baseline refers to the project constraints as set at the
beginning of the project - the initial cost, scope and schedule
Bathtub curve - Answers - Utilised in reliability engineering, the curve represents three
categories of failure; early failures will decrease over time, to be replaced with a
constant failure rate resulting from random failures. The final category is described as
wear-out failure as the product life expectancy is exceeded
Beliefs - Answers - Accurate or inaccurate perceptions of what is true or effective
Bill of quantities - Answers - All itemisation and cost of materials, parts and labour used
in the tender document
Budget - Answers - The planned expenditure for a project or programme. It provides the
baseline to measure the actual expenditure against as the project or programme
progresses
Cash cow - Answers - An activity or feature of a business that provides a steady positive
cash flow
Cash flow - Answers - The money which flows in and out of a business in a given period
of time
, Claims management - Answers - This refers to the processes by which potential claims
are mitigated, identified and evaluated
Cognitive dissonance - Answers - Ideas which are inconsistent with an individual's
thoughts, beliefs and attitudes, especially relating to change
Collectivism - Answers - Individuals commit to collective control and action
Communication management strategy - Answers - This is used to specify the means
and frequency of communication between the project manager and project
board/programme manager
Compensation event - Answers - Events which do not arise from the contractor's fault,
for which the contractor is covered for all time and money claims resulting from the
event
Conditions - Answers - A condition is a promise or fact that forms the basis of the
contract. Conditions go to the heart of the contract and are one of the most important
parts. In the case of a breached condition, the innocent party can end the contract
Configuration management strategy document - Answers - This outlines how, and by
whom, the project's products will be controlled and protected. Configuration
management ensures that the final deliverables meet the specified criteria
Consortium - Answers - An association of individuals or organisations who pool their
resources to participate in a common activity to achieve a common goal
Contracting - Answers - A supply management activity that involves the development of
an agreement between the organisation and an external contractor regarding the
allocation of activities and responsibilities relating to a specific programme
Cost analysis - Answers - An analysis that identifies and breaks down the constituent
costs of products
Cost consultant - Answers - An individual (or group of individuals) who provides
estimates or advice on the overall cost of a programme
Cost-reimbursable contract - Answers - Also known as cost-plus contract, a pricing
mechanism where the price of a programme is calculated by adding a fee on top of the
actual costs that were incurred
Cultural dimensions - Answers - A theoretical framework which examines the effects of
cross-cultural differences on individuals in the workplace
Default - Answers - The failure of one party to fulfil its contractual obligations
Acceptance criteria - Answers - This must be met before the programme is accepted as
complete by the customer, for example, performance requirements and essential
conditions
Activity schedule - Answers - A list of activities which is agreed by the client and
contractor that trigger payments during the course of a programme
Adjudication - Answers - A dispute resolution process where the adjudicator's decision is
temporarily binding until finally determined by settlement, litigation or arbitration
Arbitration - Answers - When an independent third party is appointed by the contracting
parties to make a binding decision that will settle a dispute between the contracting
parties
Attitudes - Answers - Readiness or tendency to respond in a particular way to a given
situation
Average rate of return - Answers - A ratio which looks at the return on investment
spread over a number of years
Baseline - Answers - The baseline refers to the project constraints as set at the
beginning of the project - the initial cost, scope and schedule
Bathtub curve - Answers - Utilised in reliability engineering, the curve represents three
categories of failure; early failures will decrease over time, to be replaced with a
constant failure rate resulting from random failures. The final category is described as
wear-out failure as the product life expectancy is exceeded
Beliefs - Answers - Accurate or inaccurate perceptions of what is true or effective
Bill of quantities - Answers - All itemisation and cost of materials, parts and labour used
in the tender document
Budget - Answers - The planned expenditure for a project or programme. It provides the
baseline to measure the actual expenditure against as the project or programme
progresses
Cash cow - Answers - An activity or feature of a business that provides a steady positive
cash flow
Cash flow - Answers - The money which flows in and out of a business in a given period
of time
, Claims management - Answers - This refers to the processes by which potential claims
are mitigated, identified and evaluated
Cognitive dissonance - Answers - Ideas which are inconsistent with an individual's
thoughts, beliefs and attitudes, especially relating to change
Collectivism - Answers - Individuals commit to collective control and action
Communication management strategy - Answers - This is used to specify the means
and frequency of communication between the project manager and project
board/programme manager
Compensation event - Answers - Events which do not arise from the contractor's fault,
for which the contractor is covered for all time and money claims resulting from the
event
Conditions - Answers - A condition is a promise or fact that forms the basis of the
contract. Conditions go to the heart of the contract and are one of the most important
parts. In the case of a breached condition, the innocent party can end the contract
Configuration management strategy document - Answers - This outlines how, and by
whom, the project's products will be controlled and protected. Configuration
management ensures that the final deliverables meet the specified criteria
Consortium - Answers - An association of individuals or organisations who pool their
resources to participate in a common activity to achieve a common goal
Contracting - Answers - A supply management activity that involves the development of
an agreement between the organisation and an external contractor regarding the
allocation of activities and responsibilities relating to a specific programme
Cost analysis - Answers - An analysis that identifies and breaks down the constituent
costs of products
Cost consultant - Answers - An individual (or group of individuals) who provides
estimates or advice on the overall cost of a programme
Cost-reimbursable contract - Answers - Also known as cost-plus contract, a pricing
mechanism where the price of a programme is calculated by adding a fee on top of the
actual costs that were incurred
Cultural dimensions - Answers - A theoretical framework which examines the effects of
cross-cultural differences on individuals in the workplace
Default - Answers - The failure of one party to fulfil its contractual obligations
