PMI-ACP Question #375: Real Exam Question with Answer & Explanation

The correct answer is B: Internal Rate of Return (IRR). When projects have identical up-front investment costs, IRR is the best ranking metric because it expresses return as a percentage rate, making projects directly comparable regardless of scale. A higher IRR means a better return per dollar invested. NPV gives an absolute dollar v

Submitted by klara.se· Apr 18, 2026Value-driven Delivery

Question

Assuming all projects require the same amount of up-front investment, the project with the highest ______________ would be considered the best and undertaken first.

Options

AEarned Value Management (EVM)
BInternal Rate of Return (IRR)
CNet Present Value (NPV)
DBudget at Completion (BAC)

Explanation

When projects have identical up-front investment costs, IRR is the best ranking metric because it expresses return as a percentage rate, making projects directly comparable regardless of scale. A higher IRR means a better return per dollar invested. NPV gives an absolute dollar value (better for comparing magnitude of return but requires knowing the discount rate). EVM is a performance monitoring tool, and BAC is simply the total planned budget â€” neither is used for project selection.

Topics

#Project Selection#Financial Metrics#Internal Rate of Return (IRR)#Value Maximization

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