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Better Business Cases Practitioner Exam Questions and Answers

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Question 1

Using the Scenario and the extract below from the Revenue Budget for the Pittville project, answer the following

questions. (Note. The figures entered are correct).

Which 2 observations correctly evaluate the Expenditure?

Options:

A.

The cost of building the new campus should be included in this table.

B.

Staffing costs should be moved to the Economic Appraisal.

C.

To be useful this table should cover the lifetime of the asset.

D.

Equipment costs should be moved to the capital costs.

E.

The cost of finance should be moved to the Economic Appraisal.

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Question 2

Answer the following questions about the actions taken when preparing the Economic Case within the Full Business Case (FBC).

Decide whether the action taken represents an appropriate application of the Five Case Model for this project and select the response that supports your decision.

Since approval of the OBC, there has been an attractive bid for the Old Fire Station Headquarters site by a supermarket company.

The bid is 15% higher than the original amount that the site was valued at.

Should the FBC production be delayed while the ranking of the options in the OBC is reassessed?

Options:

A.

No, because the anticipated benefits will remain the same.

B.

No, because the sale price of the site is an opportunity cost which is irrelevant to the Economic Appraisal.

C.

Yes, because the FBC must be re-submitted for re-approval if the costs vary significantly.

D.

Yes, because the FBC should be based on accurate Economic Appraisals for all options.

Question 3

Two of the options in the OBC have been revised, as shown in the table above.

Should Option B be ranked as the preferred option?

Options:

A.

No, because the benefits are greater for Option A.

B.

No, because the public sector test discount rate has been applied.

C.

Yes, because option B has positive liquidity.

D.

Yes, because Option B has the higher NPSV.

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