Code of Ethics Professional Conduct

Question 1

You are working for a project-based organization. The organization has a procedure to report minor ethical issues, and the ethics committee reviews them at month’s end. Only major violations are escalated for in-depth scrutiny. This month, a project team member reported a minor violation of PMI’s code of ethics. The project manager, who’s a also a member of PMI, has taken on some of the project‘s activities for which he wasn’t qualified. The project manager was offered an opportunity to receive training, which he refused. When the project manager is called for his comments, he says that this rule comes under “aspirational standards” of PMI’s code of ethics and is not covered under “mandatory standards.” Has he violated the code?

A) He has violated the code.
B) He did not violate the code of ethics because he’s following all mandatory ethics.
C) This is just a comment from him; investigate further.
D) Report the violation to PMI.

Answer 1

A) He has violated the code.

Reason: He has violated the PMI Code. Project managers must adhere to all standards in the Code; none are optional.

Question 2

Your company took over the management of a project from another company that went out of business. To minimize disruptions related to the transition, your company hired a number of the employees from the other company. One of these employees has delivered a 300-page document a week ahead of schedule. However, while walking past his desk, you notice that his computer is displaying a document with the logo of his former employer. You suspect that some of his work may have been based on documentation that is the property of the other company. What do you do?

A) Determine if any materials belonging to the other company have been copied.
B) Report this to your project stakeholders immediately.
C) The copyright material is owned by the client, for whom you are working so this is not a copyright issue.
D) Do nothing. Because the company is now out of business, no one now owns the copyright on that material.

Answer 2

A) Determine if any materials belonging to the other company have been copied.

Reason: Determine if any materials belonging to the other company have been copied. The fact that the other company has gone out of business does not mean it no longer owns intellectual property.

Question 3

You have managed a project to write and publish seven books. A team of contributing writers from your client’s organization wrote the books’ content. Six of the seven books are printed and distributed, the seventh was just sent to the printer, and the project closeout work has begun. While walking through the office, you overhear one of the writers mentioning that she made extensive use of an online source of information for the sections she wrote. When you get back to your desk, you do some spot checking of this writer’s work and discover that quite a bit her text was copied word for word from this information source. You are unaware of any existing agreement authorizing the use of this material on your project. What do you do?

A) Ask the writer what else she has copied and see about getting approval from the owner of the plagiarized information
B) Call the printer and cancel the last book that has just been sent
C) Since the books have already been printed, there is no use reporting to anyone
D) Notify your project stakeholders immediately

Answer 3

Correct Answer: D
Reason: A plan of action can be developed with stakeholder input once they are advised of the situation. Not reporting violates the PMI Code of Ethics.

Question 4

The management of a retail business unit has just assigned Mario to compare multiple projects and select the best project that will produce the most value for the unit. Although Mario has worked as a project manager for a long time, he has only a limited understanding of project selection methods. What should be the first course of action from Mario in this scenario?

A) Refuse to take the assignment
B) Inform the management about lack of knowledge on project selection methods
C) Obtain an expert’s judgment to help select the project
D) Select the best project with whatever knowledge he possesses

Answer 4

Correct Answer: B
Reason: One of the mandatory standards for practitioners is honesty. Mario should disclose his lack of knowledge rather than proceed unqualified.

Question 5

You are managing a project with a large multinational staff. Susan, one of the engineers, was originally asked to deliver her part of the work on October 19. Due to a change in the critical path, her deliverable will be needed two days sooner. However, as the new deadline is still two weeks away and she is ahead of schedule, you are confident her delivery will be on time. During a staff meeting, you learn from John, her functional manager, that Susan celebrates a religious holiday on October 17. However, he also tells you that Susan is not particularly religious; if pushed a bit and offered some incentive, she may forego celebrating this holiday and come to work. What should you do?

A) Increase her project incentive if she agrees to deliver her presentation on the 17th
B) Let the critical path remain the same
C) Ask her boss to ask her to skip the holiday
D) Check whether one of her colleagues can share some of her workload this week

Answer 5

Correct Answer: D
Reason: PMI’s Code mandates respect for religious beliefs. Reassigning some workload is appropriate without applying pressure.

Question 6

You have recently started working as a project manager for a health insurance portal development project. The project sponsor tells you that due to the critical nature of the project, the work must start immediately and complete in two weeks. Based on the instructions, you have started documenting significant constraints and assumptions to perform the project feasibility study. What should you do if you can prepare only the high-level feasibility study in the given time frame?

A) Submit the high-level study and schedule a detailed study in the planning phase
B) Submit the high-level study and start making plans to prepare the charter
C) Conduct the stakeholder meeting to evaluate other options
D) Refer this issue to the sponsor and explain the need for more detailed study

Answer 6

Correct Answer: D
Reason: The feasibility study must be thorough before initiation. Escalating the need for more time is part of accurate and ethical project reporting.

Question 7

Nancy can bid on two projects. Project A has a 50 percent return on investment while Project B has a 20 percent return on investment. Project A’s scope of work is complex, and Nancy’s organization does not have the necessary skills and experience to do this project. However, Project B’s scope of work falls within the strengths of Nancy’s organization. Which project must Nancy bid on?

A) Project A since the return on investment is the highest
B) None as this is a conflict of interest situation
C) Both since the overall profit will be higher
D) Project B since the organization has the required skills

Answer 7

Correct Answer: D
Reason: Project managers must only accept work that aligns with their organization’s competencies and qualifications.

Question 8

You are managing an electronic chip design project for a customer. After completing a prototype, you submit it for review and find potential patent infringement issues. Both your team and the customer’s team contributed to the affected elements. What should you do?

A) Request permission to use the copyright material
B) Submit the prototype as is since the budget and schedule do not accommodate rework
C) Ask the engineers to revise the design and resubmit it
D) Notify the project stakeholders immediately

Answer 8

Correct Answer: D
Reason: Intellectual property violations must be reported to stakeholders so appropriate corrective action can be taken.

Question 9

A fellow project manager reported that a code module critical to your project was delivered on time. However, it is two weeks late. What should you do?

A) Have your team develop the code
B) Check which future deliverables will be coming from this project and revise your risk management plan accordingly
C) Talk to the Chief Operating Officer
D) Report the incorrect status to the appropriate management

Answer 9

Correct Answer: D
Reason: Misreporting must be escalated to management to ensure transparency and accuracy in performance tracking.

Question 10

As the project manager of a development project, you are aware that there is a slight defect in the developed product; as a result, it will fail to meet certain regulatory standards. This was due to faulty requirements. You are also aware that the product will continue to function properly even though it fails to meet those standards. Your customer manager asks you to certify that the product meets the necessary regulatory standards, stating that this will not be verified when the report is submitted to the necessary authorities. Your stance is that:

A) You will not certify that a product meets certain regulations when it does not, even though the product continues to function well.
B) You certify the product. Regulations are only guidelines in the industry. Not meeting a regulation does not mean anything.
C) As a one-off instance, you will certify the product to make sure the project goes through successfully.
D) You certify the product, but you document your conversation with your customer manager for future purposes.

Answer 10

Correct Answer: A
Reason: You cannot falsely certify compliance with regulatory standards; doing so is unethical and may be illegal.

Question 11

In a software development project, Debby, the project manager, completed development of a charter and identification of stakeholders. Debby has collected proprietary information from vendors during the planning process. What should Debby do when a functional manager from the same organization wants to see this information?

A) Deny the request to protect the confidentiality of the information
B) Deny the request as the manager is not part of the project
C) Accept the request but caution the manager to maintain confidentiality
D) Accept the request as the manager belongs to the same organization

Answer 11

Correct Answer: A
Reason: Project managers are responsible for maintaining confidentiality and may not share proprietary information inappropriately.

Question 12

Your company has recently been awarded a project to construct an airport in a developing country. This is an opportunity for your company to build an airport from scratch for the first time. Not only this will serve as a five-star project on your company’s profile, the company will also get the opportunity to procure, deploy and integrate a state-of-the-art technological solution to operate the airport. This would give a significant competitive advantage to your company. However, the client is known to be slow in clearing interim payments and as a result you might have negative cash flows on your project. Holding payments and slow processing of invoices is a norm in this country. If you have no control over this, what should you do?

A) Disengage from such a project as this will cause you nothing but stress.
B) Accept the project at this stage now and initiate legal proceeding if your payments get delayed.
C) Overbill your client so that even if the payments get delayed, the cash flow remains positive.
D) Identify the project funding requirements and consult senior management.

Answer 12

Correct Answer: D
Reason: Ethical practice requires full disclosure and planning for risks such as cash flow issues, with support from senior leadership.

Question 13

A large network hardware upgrade project was scheduled to take place over a weekend. During the course of the implementation, several previously unidentified dependencies on additional materials were discovered. The project manager gave approval for the tech staff doing the implementation to procure with corporate credit cards several hundred dollars’ worth of additional equipment required to complete the implementation. However, these additional expenses caused the project to exceed its budget. How should the project manager handle this?

A) Ask the IT Director to cover those expenses from his budget.
B) Notify the project stakeholders immediately of the additional expenses incurred and follow project and company procedures for budget variances.
C) Advise the staff to submit expense reports for the purchases. Because the cost is relatively small, it can be categorized as miscellaneous purchases that are not associated with the project.
D) Do nothing; that’s what reserves are for.

Answer 13

Correct Answer: B
Reason: Honesty and integrity require reporting budget variances and following organizational procedures.

Question 14

During the planning phase of your project, your team decided to procure a certain brand of hardware because it had the lowest price and came with free shipping and installation. This approach saved $6,000 over the other brands. Since that purchase, however, you discovered the annual maintenance costs for this hardware are $2,500 per year, and $12,500 over the life of the hardware. These costs were not budgeted in the project, nor were they included in the Total Cost of Ownership (TCO) analysis that was part of the project business case. What should you do?

A) Do nothing. This will not affect the project budget.
B) Request a new budget.
C) Revise the business case.
D) Notify the stakeholders immediately.

Answer 14

Correct Answer: D
Reason: All cost implications that may affect long-term project operations must be shared with stakeholders for informed decision-making.

Question 15

An employee, who works as senior project coordinator and is a member of the PMI, has requested that performance appraisals should be shared with the employees. This is in the best interest of transparency. He also refers to the transparency clause of the PMI code of ethics. What must you do?

A) Share the full contents of the appraisals with all employees, as the PMI code of ethics demands transparency.
B) Ask the functional managers to fill the appraisals and give your feedback to them to be incorporated in the appraisals.
C) Share full contents of the appraisals with PMI members only as they are subject to the PMI code of ethics.
D) Follow the organizational human resource policies for employee reviews.

Answer 15

Correct Answer: D
Reason: PMI’s code supports transparency but does not override your organization’s HR policies.

Question 16

You have just completed a solid waste management project in an underdeveloped country. The contractor you are working for has a strict policy of abiding by local laws and rules although the local resources working on the project have a much more lax approach to following laws and policies. Now at the end of the project, you are handing over the operational equipment to the local operators and disposing of the leftover inventory and other materials that were used during the project. More than 50 percent of the toxic materials used during the project remains in your inventory. There is no law that would prohibit you from disposing of either the type or quantity of remaining materials in the local sewage system. What should you do?

A) Abandon the materials in the project facility you are handing over to the local operators.
B) Give the material to local resources to dispose of by selling it to a recycling facility.
C) Dispose of the material in the local sewage system; there is no law applicable here.
D) Do not dispose of the materials improperly.

Answer 16

Correct Answer: D
Reason: Ethical behavior extends beyond legal compliance. Public safety and environmental responsibility must be upheld.

Question 17

You are the project manager of a construction project to build an Industrial Technology Park in a foreign country. You find that you need to transport large machinery and equipment to the construction site and this may potentially cause some disturbance to traffic in the vicinity. You therefore plan to schedule this for a time which is considered off-peak-hour traffic. Your liaison in the country informs you that you need to pay a fee to the local administration to do this. How would you handle this?

A) Payment of any fee for such a reason would be perceived as a bribe. So, you would not pay the fee.
B) Check with your legal team about whether such a fee is a requirement and complies with the local regulations.
C) You would pay this only if it was part of the initial project estimate. Otherwise, you would need to check with your customer.
D) You would pay the amount in question and adjust the same in another activity during billing since this cannot be justified.

Answer 17

Correct Answer: B
Reason: PMI requires that project managers ensure all practices comply with local laws and regulations before taking action.

Question 18

You are assisting Benjamin, another project manager, to interview candidates for a resource position on his project. While reviewing your interview notes together, you notice that he sorts the candidate‘s resumes into two piles: One pile for further interviews, the other for candidates that did not meet the requirements for the position. You also notice that he has placed several of the highly qualified candidates in the second pile, stating that those interviewees “did not fit the corporate profile.” Upon further review, you discover that all these candidates are of the same ethnic group. What do you do?

A) Do nothing
B) File a complaint with PMI
C) Excuse yourself from the interviewing process
D) Report this to the appropriate management

Answer 18

Correct Answer: D
Reason: Discrimination must be reported. Not doing so would violate PMI’s values of fairness and responsibility.

Question 19

You are a consulting project manager. An investment bank has a contract with you to run a large information technology project, which you expect to last 15 months. While developing the project charter, you discover that it did not address several regulatory requirements in the business case. Failure to meet these requirements could result in legal action against the company. However, implementing the technology to comply with these regulations could exceed the project’s budget and scope, which could lead to the project’s cancellation. What should you do?

A) Disclose the discovery to the project sponsor and stakeholders immediately.
B) Wait until the project is 25 percent complete, when you have a better idea of what resources and funding could be allocated.
C) Write up a scope change request for the work.
D) Track this as a risk.

Answer 19

Correct Answer: A
Reason: Compliance with laws and transparency require immediate notification of issues that may lead to regulatory violations.

Question 20

The project you are managing has had many customer-requested requirements changes. Communication and control of the main supplier was a challenge, as well; nearly all this supplier’s deliverables were late, resulting in cost increases of 32 percent and delays of 2.5 months. No deliverables from any other supplier were late. While preparing closeout documentation, you discover that the unreliable supplier is a company owned by the senior director’s brother. What do you do?

A) Notify the appropriate management immediately of a potential conflict of interest.
B) Call the vendor and complain about their performance.
C) Freeze the requirements for the remainder of the project.
D) Fire the vendor.

Answer 20

Correct Answer: A
Reason: Even the perception of a conflict of interest must be reported for proper investigation and ethical management.

Question 21

You are working for a large project organization with several project managers working on 15 projects. All project managers submit their status reports at month’s end. One of your fellow project managers, Jane, has reported an error in the past two months. From discussions with one of her project’s team members who is also working on one of your projects, you realize Jane is deliberately misreporting the project’s status to inflate her performance for the annual performance appraisal next month. The month-end review meeting is in two days, and you are preparing your own presentation for it. What should you say about her status report?

A) Investigate and verify the blame before reporting the incorrect status to the appropriate management.
B) Send an email to her boss asking to check the contents of her report.
C) Since there is no direct relationship between your project and hers, there is no need to intervene in this issue.
D) Prepare a brief of what you have discussed with her team member and report the inconsistency in the meeting.

Answer 21

Correct Answer: A
Reason: You must verify information before reporting another’s error. Acting without evidence would be unethical.

Question 22

You are responsible for developing high-level risks, assumptions, and constraints for your project. You meet with experts in your organization and document various risks in the project. However, in reviewing historical data from a previous project, you notice a significant additional risk to your project, one that no one else is aware of. What should you do to continue the project?

A) Document it but make it a low-level risk.
B) Document it and make it a high-level risk.
C) Do not document the risk since it is based on past data.
D) Do not document the risk since nobody knows about it.

Answer 22

Correct Answer: B
Reason: If you are aware of the risk, it must be properly documented and assessed—regardless of the source or visibility.

Question 23

You have recently joined a new company as a project manager. While reviewing the procurement plans for a project you will be taking over, you see that the company is considering using one of the most expensive manufacturers to provide certain equipment required for the project. At your previous employer, you had used a different supplier for the same equipment and had paid significantly less. Without telling your boss, you now call that supplier for a quote. Have you violated the rule of keeping proprietary information confidential?

A) No. There is no harm in sharing the information with your current employer, because you are no longer working for your old employer.
B) You have not violated any rule.
C) Yes. The supply source is proprietary information, and you should not contact the supplier.
D) Maybe. You need to talk to your boss first.

Answer 23

Correct Answer: B
Reason: No confidential information was shared or misused. Contacting a known supplier without disclosure does not violate PMI’s code.

Question 24

You are using the one-on-one interview technique to gather high-level risks, assumptions, and constraints in an infrastructure development project to set up a bank. During the interview process, a key stakeholder tells you that the project might fail due to lack of support from local people. What should you do in this situation?

A) Escalate the stakeholder’s comments to the sponsor for his advice.
B) Investigate the reasons behind the stakeholder’s comments.
C) Ignore the stakeholder’s comments and continue with the project.
D) Document the stakeholder’s comments and continue with the project.

Answer 24

Correct Answer: B
Reason: Understanding the rationale behind stakeholder concerns is critical to accurate risk assessment and ethical project planning.

Question 25

The project you are managing involves 43 people from different departments and is on schedule and within budget. You conduct project review meetings every week. There are a number of attendees who are quite vocal and can easily send the meeting off track with their questions and comments. You are in a functional organization, where the project manager has little formal authority. Sam, a team member who reports to a senior line manager, sends an email to you and his manager, reporting that two attendees were quite disrespectful in the last meeting and that the general atmosphere of the meetings upsets him. As a result, he will no longer attend weekly review meetings. However, other project members have complained about this person’s shyness and seeming inability to get along with people. What should you do? A) Ask for a replacement resource. B) Do nothing. C) Establish meeting ground rules. D) Talk to the employee directly and try to understand the reasons for his withdrawal.

Answer 25

Correct Answer: C Reason: As a project manager, you are responsible for ensuring a respectful and inclusive team environment through clear expectations.

Question 26

You recently joined a large multinational pharmaceutical product’s company as a project manager. This is your first experience in a pharmaceutical company; your past jobs have been primarily with auto parts manufacturing companies. The company will launch a new product in a South American country, and you will manage this effort. This product is quite popular in your home market, and pharmaceutical industry reports give it high praise. As you review the project documentation from similar projects, you discover that promotions focus on hospitals, physicians, and other medical practitioners. These targeted groups have been offered incentives such travel, cars, and other luxury items to recommend this company’s products. This is the first time you have seen this type of incentive system in your career. What should you do? A) Reject this project. B) Accept the project. C) Check the international practices of other pharmaceutical companies. D) Investigate these practices to determine if they are in compliance with the laws of your country, the country where the product will launch, and your company’s policies.

Answer 26

Correct Answer: D Reason: Ethical action requires verifying legality and policy alignment before proceeding with practices that raise concerns.

Question 27

The project you are managing has a very slim profit margin. It requires experts from different disciplines, some of whom are not only expensive but are also highly in demand, resulting in frequent job switching. The most expensive senior worker in a specific area of expertise also happens to be the only available resource in that area in your organization, and you were just informed he has resigned. As it happens, he has joined your client’s organization. Hiring a replacement can be extremely expensive due to shortage of expertise and will increase your project cost. The contract specifies the customer will not pay any extra cost. When you bring this issue to your manager, he suggests using a junior level person in another department. The junior resource had worked with the recently departed senior person for over a year. What should you do? A) Hire a new expert. B) Call your customer and explain that since his resource has joined their organization, a junior resource will work on the project. C) Ask your client to assign your former employee to your project. D) Call the client to revise the contract.

Answer 27

Correct Answer: A Reason: Substituting a less-qualified resource violates ethical standards. The proper course is to hire an expert with comparable qualifications.

Question 28

A government agency has awarded your company a massive software project. This project has an early completion incentive, and your company has a policy of paying a bonus to the project manager if such an incentive is awarded. However, this particular government agency has a reputation for being extremely difficult to work with; there is a great deal of bureaucracy within this agency, and stonewalling and hostility toward contractors are common. The project manager will need to have excellent political skills to lead this project successfully. You have been asked to lead the project because of your expertise with this type of project. However, you have never worked within such a highly charged and political environment. What should you do? A) Accept the project. B) Decline the project citing lack of experience. C) Accept the project and request that a corporate liaison be assigned to your project. D) Accept the project but disclose your lack of experience in this type of environment.

Answer 28

Correct Answer: D Reason: PMI’s Code of Ethics allows stretch assignments when full disclosure is made to stakeholders and they consent to your leadership.

Question 29

You are an electrical engineer with extensive experience in managing transmission projects but limited experience with electronic design projects. However, in a stretch assignment, you were recently transferred to another department in your company that focuses on electronic design. Furthermore, you were asked to lead a highly important project involving both transmission and electronic design. In preparation for a meeting with your manager to discuss this opportunity, you review the initial project design brief. Due to your limited background in electronic design, a number of items in this document seem unclear to you. When you arrive at your meeting, your manager asks if you will be leading the project. How do you respond? A) Accept the project, but do not discuss your qualifications or lack thereof. B) State that you would like to lead the project, but you must disclose that your primary domain of expertise is transmission, and that you may need supplementary training in electronics design. C) Decline the project, citing your lack of experience in electronics design. D) Accept the project and tell your manager that your expertise in transmission makes you an ideal manager for this project.

Answer 29

Correct Answer: B Reason: Disclosing your qualifications honestly while showing willingness to grow aligns with PMI’s standards of responsibility and respect.

Question 30

You are a business development manager at a mid-sized automobile manufacturing company. Recently, you were given a project to assess the feasibility of manufacturing light-duty trucks in a Southeast Asian country. To develop a cost estimate, you visit the country with a team of experts to analyze local resources such as power, labor, and real estate. After the visit, you discuss the findings with an automobile manufacturing consultant. The consultant notes that the local laws and government bureaucracy typically make foreign investors spend more than a year obtaining all necessary permits. To avoid these delays, the consultant advises giving a small amount of company stock to the son of the country’s president. In return, the president’s son will personally expedite the issuing of all required permits. What should you do? A) Notify your company that a bribe is necessary to avoid lengthy delays in permitting. B) Determine the legality of the proposed exchange of stock for permitting assistance. C) Facilitate a meeting with the president’s son and your managing director to finalize the details. D) Add the opportunity costs associated with the year delay in getting permitted without local assistance.

Answer 30

Correct Answer: B Reason: Before proceeding, determine whether the proposed action is legal in all relevant jurisdictions and aligned with company policy.