Project Management: Payback Model and Financial Strategy

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10 Questions

What is the main limitation of the Payback model?

Ignores the time value of money

What does a positive Net Present Value (NPV) indicate?

The project meets the minimum desired rate of return and is eligible for further consideration

What does the Net Present Value (NPV) model use to compute the present value of all net cash inflows?

Discount rate

Which model uses a list of questions to review potential projects and determine their acceptance or rejection?

Checklist Model

What is the main drawback of the Checklist Model?

It fails to answer the relative importance or value of a potential project.

Which nonfinancial strategic criterion aims to prevent government intervention and regulation?

To prevent government intervention and regulation

What does the organization need to do when reassessing its goals and priorities?

Evaluate the progress of current projects

Which type of projects involve technological breakthroughs with high commercial payoffs?


What is used to balance the portfolio for risks and types of projects?

Priority system

Which term refers to projects that showed promise at one time but are no longer viable?

White Elephants

This quiz covers the Payback Model in project management, focusing on its use in measuring the time for project investment recovery, emphasizing cash flows, and its limitations such as ignoring the time value of money and profitability considerations. The content is based on material from Universiti Malaya's WIX2002 - Project Management course.

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