Prepare L6M5 Question Answers Free Update With 100% Exam Passing Guarantee [2025]
Dumps Real CIPS L6M5 Exam Questions [Updated 2025]
NEW QUESTION # 25
What is Earned Value Analysis (EVA) in project management?
Answer Options:
- A. The amount of resources allocated to a project vs. resources available
- B. The profit or loss generated by the project thus far
- C. The value of a project, expressed as a percentage of money invested
- D. A comparison of where the project is up to vs. where it is forecasted to be
Answer: D
Explanation:
EVA compares planned vs. actual project progress (p.112). It ensures projects stay on track by measuring deviations from expectations. Option B relates to financial performance, C describes ROI, and D refers to resource allocation. [P.112]
NEW QUESTION # 26
Skipped
Which of the following describes tacit knowledge? Select all that apply.
- A. It is usually unwritten
- B. It can be found in Standard Operating Procedures within the procurement department
- C. It can be captured from reports and data
- D. It is easy to transfer from one person to another
- E. It is easy to capture and write down
Answer: A
Explanation:
Tacit knowledge is knowledge that is difficult to transfer or explain. The other four options describe explicit knowledge. Tacit knowledge is usually unwritten, like the history of a relationship between a buyer and supplier or why a company does things in a certain way.
Domain: 2.4
NEW QUESTION # 27
Skipped
An End-Of-Project Review may include the hiring of an external consultant to audit a project. This is particularly true in the Public Sector and for high-value/high-risk projects. The Auditor is likely to review the project's performance against what?
- A. Other similar projects completed by the organization
- B. The project plan
- C. Projects completed in the private sector
- D. Configuration management
Answer: B
Explanation:
The audit will compare the results of the project with the project plan (i.e., what the project set out to achieve vs. what it actually achieved). This is from p. 142.
Domain: 2.4
NEW QUESTION # 28
KCJ Ltd is a public sector organisation planning five projects for the next financial year. Each project has a distinct cost estimation method and source of power for the project leader.
Your task is to match the correct cost estimation method and source of power to each project.
Project Descriptions
Project 1
Description: Budget estimation is calculated using an algorithm.
Project Lead's Power: Founder of the organisation.
Project 2
Description: The Head of R&D (PhD in Data Science) is using costing from similar past projects to determine the budget.
Project Lead's Power: Expertise in Data Science.
Project 3
Description: The project is led by a key stakeholder and involves creating a Bill of Materials. Costs are worked out item by item.
Project Lead's Power: Authority due to stakeholder influence.
Project 4
Description: The Project Leader has calculated the base cost, most likely cost, and worst-case scenario.
Project Lead's Power: Has the authority to cancel the project at any time.
Project 5
Description: The project leader is a well-liked Board Member who has selected a team he is comfortable with. He determined the budget based on his own research.
Project Lead's Power: Personal relationships with team members.
Answer:
Explanation:
NEW QUESTION # 29
Scenario:
Fin Inc is a consultancy organisation in the private sector, founded 10 years ago by CEO Geoff Davies, who runs a tight ship. Many employees are scared of Geoff, and there are rumours that he fires people for refusing overtime. Fin Inc is working with a new client on a shopping centre project led by the well-liked CFO. The client wants a flexible, collaborative contract with transparent cost-sharing.
What type of organisational structure does Fin Inc have?
- A. task
- B. power
- C. role
- D. person
Answer: B
Explanation:
The structure is centred around the CEO's authoritative style, which is indicative of a power-based structure.
NEW QUESTION # 30
Which of the following is true about Engineering, Procurement, and Construction (EPC) Contracts? (Select all that apply.) EPC contracts, commonly referred to as Turnkey Projects, are widely used in construction and infrastructure projects. These contracts require the contractor to design, procure materials, and construct the project to deliver a complete and operational facility to the client.
Answer Options:
- A. The contractor is responsible for the design aspect of the construction
- B. The contractor may operate the building for a certain period after completion
- C. These contracts are commonly known as Turnkey Projects
- D. These contracts are sometimes referred to as Design and Build Contracts
- E. These contracts are used when forming a partnership between a private and public organization
Answer: A,C,D
Explanation:
The correct answers are 1, 3, and 4 (p.8). Option 2 is incorrect as it describes a DBO (Design-Build-Operate) contract rather than an EPC contract. Option 5 is incorrect because it describes a PPP (Public-Private Partnership) contract, not an EPC contract. [P.8]
NEW QUESTION # 31
Scenario (same as Question 16):
Fin Inc is working with the new client. What type of costing system is being used?
- A. open book
- B. bill of quantities
- C. bottom up
- D. fixed fee
Answer: A
Explanation:
An open book costing system involves sharing financial details transparently between the parties.
NEW QUESTION # 32
Casper is conducting a Variance Analysis of the company's budget. What is its main purpose?
Answer Options:
- A. To identify where cost savings can be made
- B. To minimize inefficiencies
- C. To analyze whether costs are fixed or variable
- D. To identify which departments have overspent
Answer: B
Explanation:
A Variance Analysis (p.95) compares planned vs. actual budget and identifies inefficiencies to enhance financial performance. Option A focuses only on overspending, B on cost-cutting, and D on categorizing costs rather than improving efficiency. [P.95]
NEW QUESTION # 33
Which of the following statements about investment appraisal techniques are true? (Select all that apply.) Answer Options:
- A. Payback analysis ignores cash flow after the business recovers its costs
- B. Return on Capital Employed (ROCE) is expressed as a percentage of the value of assets used to generate profit
- C. Non-discounted cash flow methods focus on profit maximization
- D. Internal Rate of Return (IRR) can be used with Net Present Value (NPV)
Answer: A,B,D
Explanation:
Option B is correct - ROCE is expressed as a percentage (p.87).
Option C is correct - Payback Analysis only considers the break-even point (p.83).
Option D is correct - IRR and NPV are often used together (p.82).
Option A is incorrect - Profit maximization is not the primary focus of non-discounted cash flow methods. [P.82-87]
NEW QUESTION # 34
A person who disrupts progress and hinders culture change holds which type of power?
Answer Options:
- A. Contrary
- B. Negative
- C. Dismissive
- D. Pessimistic
Answer: B
Explanation:
Negative Power (p.199) refers to individuals obstructing progress in an organization.
Dismissive (A) means ignoring opinions.
Contrary (B) and Pessimistic (C) do not refer to organizational influence. [P.199]
NEW QUESTION # 35
Mustard Ltd contracted Red Ltd for IT services, requiring 98% internet connectivity.
Red Ltd has only achieved 90% connectivity despite multiple meetings.
Mustard Ltd now seeks to terminate the contract.
Q: Can Mustard Ltd terminate the contract?
Answer Options:
- A. Yes - connectivity was written into the contract, and Red Ltd is failing to deliver
- B. Yes - since previous meetings have failed to resolve the issue, termination is justified
- C. No - Red Ltd should be given more time to fix the issue
- D. No - the contract would not allow for termination
Answer: D
Explanation:
Connectivity is listed as a warranty, not a condition (p.125).
Warranty breaches allow for damages but do not permit contract termination.
If it were a "condition" instead of a warranty, termination would be allowed. [P.125]
NEW QUESTION # 36
Glitter Kitten Ltd CEO applies the Payback Analysis for expansion.
Investment: £50m
Annual returns: £10m
Q: What is the payback period?
Answer Options:
- A. 5 years
- B. 1 year
- C. 10 years
- D. 50 years
Answer: A
Explanation:
Payback period formula:
Investment (£50m) ÷ Annual inflow (£10m) = 5 years. [P.1.4]
NEW QUESTION # 37
Which project management methodology outlines a process for closing a project?
Answer Options:
- A. MRP
- B. Critical Path
- C. Prince2
- D. Monte Carlo
Answer: C
Explanation:
Prince2 has a defined "Closing a Project" phase (p.136).
Monte Carlo (A) relates to risk analysis.
Critical Path (B) maps dependencies but does not specify closure.
MRP (C) is used for inventory planning. [P.136]
NEW QUESTION # 38
Cactus Construction is the Principal Contractor on a housing estate project under an NEC contract. Which of the following scenarios would be a mandatory variation?
- A. the client changes their opinion on the design
- B. the project falls behind the plan due to staff shortages
- C. changes to building regulations
- D. raw material prices increase
Answer: C
Explanation:
Changes to building regulations are mandatory because they are legally binding and require compliance.
NEW QUESTION # 39
In which scenario would a Cost Reimbursable contract be most suitable?
Answer Options:
- A. The creation of a new product, where time is critical, and the client wishes to reward the contractor for speedy delivery
- B. A construction project where raw material prices may fluctuate
- C. The manufacturing of food items, where the client may return raw materials that do not meet specifications
- D. A research project where the exact scope of work is unknown at the onset
Answer: D
Explanation:
Cost Reimbursable contracts are widely used in research projects where the exact scope is uncertain (p.69). These contracts allow for flexibility in cost adjustments based on project progress. Option B describes a contract using cost-plus pricing, and Options C and D do not fit this contract model. [P.69]
NEW QUESTION # 40
Jerry is responsible for starting a new construction project.
His company wants to build a new Water Park on the outskirts of town.
He has prepared a Statement of Need, outlining requirements and benefits.
Senior Management has approved the project to move forward.
Q: What should be Jerry's next task?
Answer Options:
- A. Project brief - creating a list of technical requirements
- B. Appointment of a construction manager to manage the project
- C. Concept design - outlining how the water park would look and operate
- D. Feasibility study - looking in-depth at options available
Answer: D
Explanation:
The next stage after a business justification is a Feasibility Study (p.18-19). This assesses financial viability and risks before moving forward. Concept design and project brief come after feasibility, and the construction manager is appointed much later in the process. [P.18-19]
NEW QUESTION # 41
Giant Construction Company is working on five large-scale projects. Each project has a specific contract type and pricing mechanism.
Your task is to match the correct contract type and pricing mechanism to each project.
Project Descriptions
Project 1
Description: Giant is collaborating closely with the client to construct a hospital. The client has provided a cost estimate, and any savings will be shared between the parties. This contract is popular in the public sector due to its flexibility.
Project 2
Description: This suite of contracts is known as the "rainbow suite". It is rigid, meaning no changes can be made after signing. The price was fixed at the date of signing.
Project 3
Description: This international project involves the construction of wind turbines. The pricing mechanism calculates costs for each individual turbine.
Project 4
Description: The most popular form of contract in construction, utilizing a Contract Administrator to ensure timely information flow. Since the scope was not clearly defined, Giant is working with the client on a cost-sharing basis plus a small profit margin.
Project 5
Description: The project involves ICT services and software provision. Payments are linked to milestone completion during the project implementation phase.
Answer:
Explanation:
NEW QUESTION # 42
Which of the following aspects of culture make up the 'paradigm of the working environment' according to Gerry Johnson and Kevan Scholes? Select all that apply
- A. artifacts
- B. rituals
- C. stories
- D. control systems
- E. symbols
Answer: B,C,D,E
Explanation:
Stories, rituals, symbols, and control systems are part of the Cultural Web. The other two aspects of the Cultural Web (organisational structure and power structure) are not listed here.
NEW QUESTION # 43
Below are descriptions of five companies in the UK. Each company has a unique organisational culture and a key Cultural Web Influence that shapes its structure and operations.
Your task is to match the correct type of organisational culture and cultural web influence to each company.
Company Descriptions
Company 1
Description: Authority is centred around the founder. There are strict financial systems and a reward/bonus scheme for meeting targets.
Company 2
Description: Employees operate independently and often bring in their own clients. There is a strong corporate identity and branding.
Company 3
Description: Strict hierarchy determines salary and job titles. The organisation is described as bureaucratic and follows stringent rules.
Company 4
Description: Employees work in small teams or individually on projects. There is a strong emphasis on weekly team meetings where tasks for the upcoming week are discussed.
Company 5
Description: Authority is held by senior leadership who make all decisions. There are few rules, and culture is reinforced by storytelling about past successes.
Answer:
Explanation:
NEW QUESTION # 44
Cyril Engineering entered into a contract with Dojo Ltd for electrical engineering services to a power station.
The contract was successful for two years, but Cyril Engineering failed to fulfill obligations recently.
Q: What is this situation known as?
Answer Options:
- A. Default
- B. Consequential Loss
- C. Damages
- D. Direct Loss
Answer: A
Explanation:
Failure to meet contractual obligations is classified as Default (p.123).
Consequential Loss (A) refers to indirect financial loss due to contract failure.
Damages (B) are legal remedies for breaches.
Direct Loss (D) relates to immediate financial impact, but default is the correct term for a failure to meet obligations. [P.123]
NEW QUESTION # 45
Jennifer is drafting a contract with a "termination for convenience" clause.
Q: What obligations should be included in this clause? (Select all that apply.)
- A. The smooth transition of services to a new supplier
- B. The destruction of confidential information
- C. The return of any advance payments
Answer: A,B,C
Explanation:
A termination for convenience clause outlines the responsibilities when a contract is ended early by mutual agreement (p.135).
Returning advance payments ensures fairness.
Destroying confidential data prevents misuse.
Smooth service transition minimizes disruptions.
A review meeting is not mandatory, so it is incorrect. [P.135]
NEW QUESTION # 46
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