Business Case Writing Business Case Writing MCQ 5

Question 1

A project sponsor rejects a business case because it lacks a clear problem statement. What does this indicate about the document?

Accepted Answer

The document failed to establish the need for change

Answer

Without a clear problem statement, stakeholders cannot assess why the investment is necessary or what success looks like.

Question 2

Which discount rate is most commonly used in public sector business cases to calculate Net Present Value?

Accepted Answer

A government-specified social discount rate

Answer

Public sector bodies (e.g., using HM Treasury or OMB guidance) apply a mandated social discount rate to reflect societal time preference.

Question 3

What is the key difference between a project charter and a business case?

Accepted Answer

A business case justifies why a project should be approved; a charter authorizes it to begin

Answer

The business case makes the investment argument; once approved, the charter formally authorizes the project and assigns the project manager.

Question 4

In business case writing, 'scope creep' during the development phase can best be managed by:

Accepted Answer

Defining clear boundaries and exclusions in the scope section

Answer

Explicitly stating what is out of scope prevents stakeholders from expanding the solution beyond what the financials support.

Question 5

When presenting two financial options with similar NPVs, what additional factor most often determines the recommended choice?

Accepted Answer

Risk profile, strategic alignment, and implementation complexity

Answer

When financials are comparable, risk exposure, fit with strategy, and delivery confidence become the decisive differentiators.

Business Case Writing Practice Test