PFMP · Question #3
Which of the following is not an investment choice tool?
The correct answer is B. The use of spreadsheets or other tools to examine factors of interest. Using spreadsheets or general tools to examine factors describes a generic analytical technique, not a specific investment choice tool.
Question
Which of the following is not an investment choice tool?
Options
- ATrade-off analysis determines the effect of changing one or more factors of the portfolio
- BThe use of spreadsheets or other tools to examine factors of interest
- CBudget variability determines the effect of changing the portfolio
- DTime-to-market variability determines the effects of portfolio velocity
How the community answered
(16 responses)- A6% (1)
- B88% (14)
- D6% (1)
Why each option
Using spreadsheets or general tools to examine factors describes a generic analytical technique, not a specific investment choice tool.
Trade-off analysis is a recognized investment choice tool that evaluates the effect of changing one or more portfolio factors.
The use of spreadsheets or other tools is a broad analytical technique category and not a defined investment choice tool in portfolio management. Specific investment choice tools are named methods - such as trade-off analysis, budget variability, and time-to-market variability - that have defined purposes for evaluating portfolio investments.
Budget variability analysis is a specific investment choice tool used to assess the impact of budget changes on portfolio outcomes.
Time-to-market variability is a defined investment choice tool that measures the effects of changes on portfolio velocity and delivery timing.
Concept tested: Portfolio investment choice tools and techniques
Source: https://www.pmi.org/pmbok-guide-standards/foundational/standard-for-portfolio-management
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