Knowledge Check: Initiation

Test your ability to authorize projects, justify value, and establish a clear delivery foundation for the 2026 PMP exam.

Chapter 5: Initiation

Question 1 of 5

20%

You are helping a sponsor choose between two projects. Project Alpha has an NPV of $50,000 and an IRR of 12%. Project Beta has an NPV of $75,000 and an IRR of 8%. Which project should you recommend solely based on financial value?

A. Project Alpha, because the higher IRR indicates a better interest rate

B. Project Beta, because NPV is the superior metric for total value realization

C. Neither, as you must wait for the Payback Period to be calculated

D. Both projects should be initiated simultaneously

Additional Study Topics

For full Chapter 5 proficiency, ensure you can:

1. Select the correct metric: NPV vs BCR vs IRR.
2. Sequence the Start: Why the Charter usually happens before the Register.
3. Audit the Log: Knowing when to promote an Assumption to a Risk.
4. Identify the Authority: The difference between a Sponsor (Authority/Funding) and a PM (Leadership/Execution).

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📝 Exam Insight: If a project is running and you discover the Business Case is no longer valid (e.g., market changed), your immediate goal is to inform the sponsor. Do not just keep working; protect the organization's resources.