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APMG BBC Foundation practice questions

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Question 1Strategic case

In the Five Case Model, which question does the strategic case primarily answer?

  1. Does the proposal offer the best value for money of the options considered?
  2. Is the proposal affordable within the organization's available budget?
  3. Is there a compelling case for change and does it offer strategic fit? Correct answer.
  4. Can the proposal be procured, contracted and successfully delivered?

Explanation

The strategic case establishes why the investment is needed, showing that it fits the organization's objectives and that there is a compelling case for change. Affordability, value for money and deliverability are tested in other cases, so the strategic case does not carry those arguments.

Question 2Strategic case

Within the Five Case Model, the strategic case is commonly described as presenting which of the following?

  1. The case for affordability
  2. The case for delivery
  3. The case for the preferred option
  4. The case for change Correct answer.

Explanation

The strategic case makes the case for change: it explains the current position, the need for intervention and the outcomes sought. The remaining cases build on it by justifying the preferred option, demonstrating affordability and showing how delivery will be managed.

Question 3Strategic case

Investment objectives set out in the strategic case should be expressed so that they are:

  1. Broad and aspirational, so that they allow flexibility later on
  2. Focused only on the financial returns to the organization
  3. Specific, measurable, achievable, relevant, time-bound Correct answer.
  4. Written by the external supplier during the procurement process

Explanation

Objectives must be testable, so they are expressed in SMART terms: specific, measurable, achievable, relevant and time-bound. Only then can the business case show later whether the investment has delivered what it promised.

Question 4Strategic case

In the strategic case, a constraint is best described as:

  1. An external event that the project depends on but does not control
  2. A benefit that will accrue after the project has closed
  3. A limit on the freedom of action available to the project Correct answer.
  4. A risk that has already been realized

Explanation

Constraints restrict what the project may do, for example fixed deadlines, legislation, site limits or capped funding, and they shape which options are feasible. Recording them in the strategic case keeps later option appraisal within realistic boundaries.

Question 5Strategic case

For the purposes of the strategic case, a dependency is:

  1. A cost that cannot be avoided whatever option is chosen
  2. A decision that the project team must take before approval
  3. Something the project relies on but does not control Correct answer.
  4. A restriction imposed on the project by legislation

Explanation

Dependencies are external conditions, decisions or outputs from others on which the proposal relies, such as a decision by another body or a shared service. They matter because delay or failure outside the project's control can undermine the case for change and the timetable.

Question 6Strategic case

The scope element of a strategic case should:

  1. Define what is included and excluded Correct answer.
  2. Provide the detailed cost breakdown
  3. Name the preferred supplier
  4. List every task in the project schedule

Explanation

Scope in the strategic case sets the boundaries of the proposal, stating clearly what the investment will and will not cover. Explicit exclusions prevent later misunderstanding about what the funding is intended to deliver.

Question 7Strategic case

Why does the strategic case describe the current 'business as usual' position?

  1. To justify the procurement strategy chosen
  2. To satisfy the accounting standards for capital expenditure
  3. To show that the organization has sufficient funding
  4. To set a baseline for assessing the need to change Correct answer.

Explanation

Describing how things work today, including current volumes, costs and performance, creates the baseline against which the gap and the expected improvements can be judged. Without a baseline, claims about the need for change and about future benefits cannot be evidenced.

Question 8Strategic case

A team is identifying stakeholders to record in the strategic case. Which group should be included?

  1. Only the senior managers who approve the budget
  2. All parties who can affect or be affected Correct answer.
  3. Only the external suppliers who may bid
  4. Only the people who will use the new service

Explanation

Stakeholder analysis covers everyone who can influence the proposal or is affected by it, including users, staff, unions, regulators, delivery partners and funders. Narrowing the list to one group hides the interests and objections that could later derail the investment.

Question 9Strategic case

A strategic case states: 'We will implement a new cloud-based customer portal.' A reviewer objects that this describes a solution rather than a need. Which restatement best expresses the underlying business need?

  1. The organization requires a cloud platform with at least 99.9% availability
  2. The IT department will migrate three systems to the cloud next year
  3. Customers cannot apply online, causing avoidable delays Correct answer.
  4. The portal will be procured through a framework agreement

Explanation

A business need describes the gap between the current and the desired position in terms of the problem to be solved, not the means of solving it. Stating the problem leaves room to compare genuinely different options before a portal or any other solution is chosen.

Question 10Strategic case

For a hospital reconfiguration proposal, which of the following is an outcome rather than an output?

  1. A new wing with 40 beds constructed by March
  2. Installation of a new imaging scanner
  3. Waiting time falls from 18 weeks to 9 weeks Correct answer.
  4. A training programme for 200 clinical staff

Explanation

Outputs are the deliverables the project produces, while outcomes are the changes in performance or circumstances that result from them. A fall in waiting time is a result for patients; the building, the scanner and the training are things the project builds or delivers.

Question 11Strategic case

What is the main purpose of a vision statement in the strategic case?

  1. To list the risks that the project will face
  2. To define the contractual arrangements with suppliers
  3. To describe the desired future state Correct answer.
  4. To summarize the detailed cost plan

Explanation

The vision statement expresses the intended future state in plain terms so that stakeholders share an understanding of what the investment is for. It sits above the objectives, which then translate the vision into measurable targets.

Question 12Strategic case

Why is the 'do nothing' or 'do minimum' position described in the strategic case?

  1. To satisfy the requirement to consider at least three options
  2. To fix the budget available for the project
  3. To show what happens if the organization does not invest Correct answer.
  4. To identify the cheapest option for the economic appraisal

Explanation

Setting out the consequences of continuing as now demonstrates the cost of inaction and gives the case for change its force. It also provides the reference point against which the costs and benefits of other options are later compared.

Question 13Strategic case

A corporate plan commits the organization to cutting carbon emissions by 40% by 2030. A proposal to replace the vehicle fleet with electric vehicles is submitted. Which element of the strategic case does this linkage best illustrate?

  1. Affordability
  2. Commercial viability
  3. Deliverability
  4. Strategic fit Correct answer.

Explanation

Strategic fit shows that the proposal contributes directly to a stated corporate objective or policy commitment. Demonstrating that alignment is the core of the strategic case, whereas affordability, commercial viability and deliverability are tested elsewhere.

Question 14Strategic case

How should benefits be treated when they are first set out in the strategic case?

  1. Limited to those that can be guaranteed to be realized
  2. Quantified in monetary terms and discounted to present value
  3. Left to the supplier to define during contract negotiation
  4. Described clearly and linked to the objectives Correct answer.

Explanation

At strategic stage the priority is to identify benefits, describe them clearly and tie each one to an investment objective, so that the logic of the case is visible. Monetary valuation and discounting come later, when the economic case appraises options.

Question 15Strategic case

Which of the following is the best example of a SMART investment objective?

  1. Cut claim processing time from 12 days to 5 days by March 2027 Correct answer.
  2. Explore options for improving back-office efficiency
  3. Deliver a modern, digital service that meets user needs
  4. Improve customer satisfaction across all channels as soon as possible

Explanation

A SMART objective states a specific measure, a baseline, a target and a date, so achievement can be verified. The claim-processing objective names the metric, both values and the deadline, whereas the other statements cannot be tested.

Question 16Strategic case

How should key strategic risks be handled when the strategic case is written?

  1. They should be ignored until the management case is prepared
  2. They should be listed only if they have already occurred
  3. They should be transferred in full to the supplier
  4. They should be summarized as the principal risks to the case for change Correct answer.

Explanation

The strategic case should show that the main risks to the case for change and to the realization of benefits have been thought about and summarized. Detailed risk registers, mitigations and owners are then developed in the management case.

Question 17Strategic case

Why should stakeholders be engaged while the strategic case is being developed?

  1. To allow the supplier to begin work early
  2. To reduce the number of options that must be appraised
  3. To avoid the need for a benefits realization plan
  4. To test whether the stated need and objectives reflect reality Correct answer.

Explanation

Early engagement checks assumptions about the problem, the affected groups and what would count as success, which improves the quality of the case for change. It also builds the support and shared ownership that later delivery depends on.

Question 18Strategic case

A well-structured case for change typically sets out which three elements?

  1. The supplier, the contract, and the service levels agreed
  2. The costs, the benefits, and the payback period
  3. The current position, the need, and the target outcome Correct answer.
  4. The options considered, their appraisal and the preferred option

Explanation

The case for change moves from where the organization is now, to the gap or problem that must be addressed, to the future state that the investment is intended to bring about. Presenting the three in sequence shows why intervention is necessary before any option is chosen.

Question 19Strategic case

Each benefit identified in the strategic case should ideally have which of the following?

  1. A named owner accountable for delivery Correct answer.
  2. A guaranteed monetary value agreed with finance
  3. A separate line in the financial statements
  4. Approval from the supplier

Explanation

Benefits only materialize if someone is accountable for pursuing them, so each should be attributed to a named owner who is responsible for monitoring and realizing it. This ownership then carries through into the benefits realization arrangements described later.

Question 20Strategic case

As a proposal moves from strategic outline case to outline business case, how should the strategic case be treated?

  1. It should be replaced by the management case
  2. It should be removed, since the economic case becomes more important
  3. It should remain identical to preserve the original rationale
  4. It should be refined as evidence and understanding improve Correct answer.

Explanation

Business cases are developed iteratively, so the strategic case is revisited at each stage as more evidence on the need, objectives and constraints becomes available. Refinement keeps the rationale current rather than freezing early assumptions.

Question 21Strategic case

A strategic case asserts that 'demand will double over the next five years' but offers no supporting data. What is the most significant weakness?

  1. It duplicates the work of the economic case
  2. It describes an output rather than an outcome
  3. It is unevidenced, so the case for change cannot be tested Correct answer.
  4. It should have been recorded in the commercial case instead

Explanation

The case for change depends on the credibility of the evidence about the current position and future demand, because that evidence justifies intervention. An unsupported projection cannot be challenged, so decision makers have no basis for accepting the need or the scale of the response.

Question 22Strategic case

Which statement best distinguishes a business need from a service requirement in the strategic case?

  1. A business need is written by the supplier; a service requirement by the user
  2. A business need applies only to IT projects, whereas service requirements apply to every project
  3. A business need is financial; a service requirement is non-financial
  4. The need is the gap to be closed; requirements say what the service must do Correct answer.

Explanation

The business need expresses the problem or gap in outcomes, while service requirements describe the functions and performance the future service must provide in order to close that gap. Keeping them separate stops the requirements being written around a favoured solution.

Question 23Strategic case

A business case opens with a detailed description of a preferred software product, lists objectives written to match that product's features, and offers no analysis of the underlying problem. Which criticism is the most fundamental?

  1. The objectives are not linked to any benefits
  2. It is solution-led, so the case for change is not made Correct answer.
  3. The key stakeholders have not been consulted about the design
  4. The costs have not been discounted to present value

Explanation

Starting from a product reverses the required logic: the case for change must establish the gap and the desired outcomes before options are considered. Objectives derived from a product's features simply rationalize a decision already taken and prevent genuine comparison.

Question 24Strategic case

Which circumstance would most seriously undermine a strategic case that claims strong strategic fit?

  1. The proposal is supported by the finance director
  2. Its objectives conflict with a statutory duty the organization must meet Correct answer.
  3. The proposal contributes to two of the organization's five corporate objectives
  4. The proposal has a payback period of four years

Explanation

Strategic fit means the proposal supports the organization's objectives and obligations; a conflict with a legal duty contradicts the organization's overriding priorities. Partial contribution, internal sponsorship or a particular payback period do not by themselves break strategic alignment.

Question 25Strategic case

A programme's strategic case records that planning consent for the site is due from the local authority in the third quarter. How should this be classified, and why?

  1. As a dependency, since it is external and relied upon Correct answer.
  2. As a constraint, because it restricts the design choices
  3. As a benefit, because consent enables construction to start
  4. As an output, because consent is produced by the programme

Explanation

A dependency is an external event or decision the proposal relies on but cannot control, and a third party's planning decision fits that description exactly. Recording it as a dependency allows the timetable and contingency to reflect the risk of delay.

Question 26Strategic case

Within the Five Case Model, what is the strategic case primarily intended to demonstrate?

  1. That the deal with suppliers can be procured
  2. That the proposal offers the best value for money
  3. That the funding is affordable in each year
  4. That the proposal is needed and fits the organization's strategy Correct answer.

Explanation

The strategic case establishes why investment is needed and how it fits strategic priorities. Value for money, affordability, and procurement are handled by the economic, financial, and commercial cases respectively.

Question 27Strategic case

Which item is a core component of the strategic case rather than of the economic case?

  1. The sourcing and contractual route
  2. The affordability of the preferred option
  3. The spending objectives and business needs Correct answer.
  4. The calculation of option net present values

Explanation

Spending objectives and business needs define the change sought and belong in the strategic case. Net present values, affordability, and sourcing are covered in the economic, financial, and commercial cases.

Question 28Strategic case

In the strategic case, what is the difference between a constraint and a dependency?

  1. A constraint restricts what the proposal may do; a dependency is an external requirement Correct answer.
  2. A constraint is a benefit target that must be met; a dependency is a cost ceiling
  3. A constraint is an internal preference; a dependency is an optional extra feature
  4. A constraint is a governance gate; a dependency is a funding source

Explanation

Constraints are limits such as legal rules, site capacity, or fixed deadlines that bound the solution. Dependencies are external conditions or inputs, such as another project's output, that must be in place for the proposal to succeed.

Question 29Strategic case

Which of the following is an external strategic driver that could justify a proposal?

  1. A fall in staff satisfaction recorded in an internal survey
  2. A new government regulation affecting service delivery Correct answer.
  3. A supplier's offer of a short-term discount
  4. The availability of a project manager within the team

Explanation

External strategic drivers are changes outside the organization, such as new regulation, that create a need or opportunity. Internal staffing and supplier discount issues may affect delivery but are not external strategic drivers.

Question 30Strategic case

A proposal is strongly supported by one directorate but conflicts with a published corporate priority. What should the strategic case author do first?

  1. Ask the directorate to fund the proposal outside the normal governance process
  2. Delay the proposal until the corporate priority is withdrawn
  3. Assess and document the extent of strategic fit, including the conflict, before proceeding Correct answer.
  4. Remove the corporate priority from the strategic case so that the proposal appears aligned

Explanation

The strategic case must present an honest assessment of strategic fit, so conflicts with corporate priorities should be documented and addressed. Hiding the conflict or bypassing governance would undermine the credibility of the case.

Question 31Strategic case

An early strategic case assumes a 15% annual increase in service demand but gives no source. What is the most appropriate treatment?

  1. Record the assumption, cite its source or basis, and test its sensitivity Correct answer.
  2. Delete the demand assumption because it is uncertain
  3. Move the demand issue to the financial case and take no further action
  4. Present the 15% figure as a confirmed forecast in the main narrative

Explanation

Assumptions are legitimate in an early case only when their basis is transparent and their effect is tested. Recording, sourcing, and sensitivity-testing the demand figure lets decision makers judge the risk.

Question 32Strategic case

Which statement best describes a critical success factor in a strategic case?

  1. A recurring task that the project manager must complete and report each week
  2. A condition that must be met for the proposal to succeed Correct answer.
  3. A legal clause that the supplier must accept in the contract
  4. A financial ratio used by reviewers to compare shortlisted options

Explanation

Critical success factors are the conditions or outcomes that must be achieved for the investment to succeed. They guide design and evaluation but are not routine tasks, financial ratios, or contract clauses.

Question 33Strategic case

Which of the following is best classified as a dis-benefit in a strategic case?

  1. A reduction in waiting times for patients
  2. An increase in staff training completed on time
  3. A saving in estate running costs
  4. Temporary disruption to local bus routes during construction Correct answer.

Explanation

A dis-benefit is a negative consequence that stakeholders experience even when the proposal succeeds. It should be recorded and managed alongside positive benefits.

Question 34Strategic case

A stakeholder has high interest in a proposal but low influence over its approval. How should the strategic case team engage them?

  1. Keep them informed and use their views to shape the proposal where relevant Correct answer.
  2. Ignore them because they cannot affect the decision
  3. Give them final approval authority over the business case
  4. Limit communication to the formal sign-off meeting

Explanation

Stakeholders with high interest but low influence still need information and a route to contribute. Dismissing them or restricting communication can create avoidable opposition and miss useful insight.

Question 35Strategic case

Why should a strategic case state what is explicitly out of scope?

  1. To confirm that all stakeholder concerns have been resolved
  2. To reduce the number of benefits that must be measured
  3. To set clear boundaries and prevent later disputes about expectations Correct answer.
  4. To replace the need for a detailed options appraisal

Explanation

Out-of-scope statements define the boundary of the proposal and manage expectations. They do not replace options appraisal, benefit measurement, or stakeholder resolution.

Question 36Strategic case

What is the main reason for describing a range of options, including business as usual, in the strategic case?

  1. To show that the preferred option has already been chosen
  2. To frame the case for change and show that alternatives have been considered Correct answer.
  3. To calculate the exact whole-life cost of every possible approach
  4. To satisfy procurement rules before a supplier is selected

Explanation

Describing a range of options, including business as usual, shows that the case for change has been framed and alternatives will be considered. Detailed appraisal and whole-life costing are developed in the economic case.

Question 37Strategic case

Which feature most strengthens the evidence for a claimed business need?

  1. An opinion from the preferred supplier about market demand
  2. A statement from the project sponsor that the need is urgent
  3. A comparison with a similar organization's marketing material
  4. Trend data from an authoritative source showing the gap will widen Correct answer.

Explanation

Strong evidence for a business need comes from reliable, relevant data showing the size and trend of the gap. Sponsor assertions, marketing material, and supplier opinions are weaker forms of evidence.

Question 38Strategic case

A strategic case says the service must change urgently, but its decision timeline shows approval will occur only after the current contract expires. What does this most likely indicate?

  1. A financial case issue that has no bearing on the strategic case
  2. A stakeholder engagement problem that can be solved by more meetings
  3. A strong case because urgency always justifies fast-track approval
  4. An inconsistency between the stated need and the decision timetable that weakens the case Correct answer.

Explanation

The strategic case must be internally consistent: if the need is urgent, the decision timetable should reflect that urgency. A timetable that only permits approval after the current contract expires suggests a credibility gap or an unstated contingency.

Question 39Strategic case

A benefit is stated as 'improve staff morale', with no measure, baseline, or owner. What is the best treatment in the strategic case?

  1. Remove it because only financial benefits belong in a business case
  2. Define a measurable indicator, baseline, target, and owner, or record it as an aspiration Correct answer.
  3. Assign it to the supplier as a contractual payment milestone
  4. Retain it as a benefit because morale cannot be measured

Explanation

Benefits should be measurable and owned so that delivery can be managed and realized. If a morale benefit cannot be defined in measurable terms, it is better treated as an aspiration than as a firm benefit.

Question 40Strategic case

The strategic case records a dependency on a third-party data platform, but the draft plan assumes it will be available from day one. What is the most appropriate response?

  1. Reflect the dependency in risks, assumptions, and milestones, and confirm availability Correct answer.
  2. Treat the platform as a constraint rather than a dependency
  3. Move responsibility for the platform to the finance function
  4. Delete the dependency because the plan already assumes availability

Explanation

Dependencies must be visible in the strategic case and carried into planning, risk, and milestones. Assuming day-one availability without confirmation conceals a delivery risk and weakens the case.

Question 41Economic case

In the Five Case Model, which case presents the evidence that the preferred option delivers the best value for money?

  1. The financial case
  2. The strategic case
  3. The economic case Correct answer.
  4. The commercial case

Explanation

The economic case is the part of the Five Case Model that appraises options and demonstrates value for money, usually through cost-benefit analysis and comparison of present values. The other cases address strategy, commercial arrangements and affordability.

Question 42Economic case

Why does the economic case include a do-nothing option?

  1. To estimate the residual value of assets
  2. To satisfy procurement rules for competition
  3. To provide a baseline against which other options can be compared Correct answer.
  4. To show that the project team has considered closure

Explanation

The do-nothing option describes the current baseline and provides the counterfactual against which incremental costs and benefits of other options are measured. Without it, decision-makers cannot tell whether a proposal improves on the status quo.

Question 43Economic case

A benefit-cost ratio is calculated by dividing which of the following?

  1. Annual benefits divided by annual costs
  2. PV benefits divided by PV costs Correct answer.
  3. Total costs divided by total benefits
  4. Net present value divided by appraisal period

Explanation

The benefit-cost ratio divides the present value of benefits by the present value of costs. A ratio above 1.0 indicates that discounted benefits exceed discounted costs.

Question 44Economic case

Why are future costs and benefits discounted to present value in the economic case?

  1. To remove inflation from all future prices
  2. To comply with tax accounting standards
  3. To make short-term benefits appear larger
  4. To reflect time preference and opportunity cost Correct answer.

Explanation

Discounting converts future values into present value because resources available now are worth more than the same resources later. It reflects social time preference and the opportunity cost of capital.

Question 45Economic case

What is the main purpose of applying an optimism bias uplift in the economic case?

  1. To account for inflation over the appraisal period
  2. To correct cost underestimation and benefit overestimation Correct answer.
  3. To increase the discount rate for risky projects
  4. To ensure the financial case balances each year

Explanation

Optimism bias is a systematic tendency for appraisers to be too optimistic. Applying an uplift to costs and a reduction to benefits produces more realistic estimates.

Question 46Economic case

Which of the following is a cashable benefit?

  1. Greater public trust
  2. Faster customer journey times
  3. Improved staff morale
  4. A reduction in overtime payments Correct answer.

Explanation

A cashable benefit can be converted into a reduction in expenditure or an increase in income. Reduced overtime payments release cash that the organisation can use elsewhere.

Question 47Economic case

Whole-life costs in the economic case typically include which of the following?

  1. Only costs that appear in the organisation's budget
  2. Only the operating costs after go-live
  3. Capital, operating, maintenance and disposal costs Correct answer.
  4. Only the initial capital purchase price

Explanation

Whole-life costing captures all significant costs over the appraisal period, not just the initial purchase. It includes capital, operating, maintenance and disposal costs so options are compared fairly.

Question 48Economic case

Why are transfer payments such as taxes and subsidies usually excluded from the economic case?

  1. They occur outside the appraisal period
  2. They redistribute resources rather than create or consume them Correct answer.
  3. They are always paid by central government
  4. They are too difficult to estimate

Explanation

Transfer payments move resources between groups rather than using up resources. Economic appraisal focuses on resource costs and benefits, so transfers are normally excluded to avoid double counting.

Question 49Economic case

An option has a net present value of £2.4 million. What does this indicate?

  1. The option costs £2.4 million more than doing nothing
  2. Benefits exceed costs by £2.4 million in present value Correct answer.
  3. The option will generate £2.4 million of cash in its first year
  4. The benefit-cost ratio is 2.4

Explanation

NPV is the present value of benefits minus the present value of costs. A positive NPV means the option adds value relative to the discount rate used.

Question 50Economic case

What is the main purpose of sensitivity analysis in the economic case?

  1. To calculate the discount rate for the project
  2. To test changes in key assumptions Correct answer.
  3. To allocate risk between the public and private sectors
  4. To make the preferred option look more favourable

Explanation

Sensitivity analysis varies key assumptions to see how robust the appraisal result is. It helps decision-makers understand which variables most affect value for money.