Project Management Institute (PMI) Professional in Business Analysis Practice Exam

What is the purpose of a Pareto Diagram?

1. A histogram showing the frequency of results from identified causes

2. A summary of all project requirements in a single report

3. A table displaying potential project risks

4. A timeline for project completion

The correct answer is: A histogram showing the frequency of results from identified causes

The purpose of a Pareto Diagram is to visually represent the frequency or impact of problems or causes in a way that highlights the most significant factors. By showing data in a histogram format, the diagram allows project managers and stakeholders to identify which problems, causes, or issues are most significant, typically following the 80/20 rule—where 80% of the effects come from 20% of the causes. This prioritization helps teams focus their resources and efforts on the most impactful areas that need attention. In contrast, the other choices represent different tools and concepts in project management. A summary of all project requirements is typically created in a requirements document or report, which organizes and specifies the needs of stakeholders rather than focusing on frequency or impact. A table displaying potential project risks would be known as a risk register, where risks are identified, analyzed, and summarized, again not relating to frequency or impact in the same manner as a Pareto Diagram. A timeline for project completion is represented through tools like Gantt charts or project schedules, focusing on the sequence and timing of project tasks rather than the analysis of causes and their contributions to outcomes.