Ch 7 - Project Cost Management" Flashcards
The aggregation of estimated costs of individual activities or work packages to establish a cost baseline is known as what?
Cost Aggregation.
What is the process of estimating the costs of resources required to complete project work?
Cost Estimation.
What is the process of developing an approximation of the monetary resources needed to complete project activities?
Estimate Costs.
What is a technique that uses the actual cost of previous similar projects as the basis for estimating the cost of the current project?
Analogous Estimating.
What is a detailed approach that estimates the cost by summing the costs of individual activities?
Bottom-Up Estimating.
What technique uses a statistical relationship between historical data and other variables to estimate project costs?
Parametric Estimating.
The cost baseline is typically established during which process?
Determine Budget.
What is the approved version of the time-phased project budget, excluding management reserves, used to measure, monitor, and control overall cost performance?
Cost Baseline.
What is the process of aggregating the estimated costs of individual activities or work packages to establish an authorized cost baseline?
Determine Budget.
Which reserve is set aside to address the identified risks that remain after the risk response planning process?
Contingency Reserve.
Which method involves calculating the value of the work performed and comparing it to the actual cost incurred to determine project performance?
Earned Value Management (EVM).
What is the process of monitoring the status of the project to update project costs and manage changes to the cost baseline?
Control Costs.
What reserve is set aside for unidentified risks and typically requires management approval for use?
Management Reserve.
What is the formula to calculate Cost Performance Index (CPI)?
CPI = EV / AC (Earned Value / Actual Cost).
What is the formula to calculate the Schedule Performance Index (SPI)?
SPI = EV / PV (Earned Value / Planned Value)
What term refers to the difference between the budget at completion (BAC) and the actual cost?
Cost Variance (CV)
What is the term for the expected total cost of completing all work expressed as the sum of the actual cost to date and the estimate to complete (ETC)?
Estimate at Completion (EAC).
What is the term for the amount of work scheduled to be completed by a certain date, versus the amount of work actually completed by that date?
Schedule Variance (SV)
What is the term for the expected cost to finish all the remaining project work?
Estimate to Complete (ETC).
What is the formula for calculating Estimate at Completion (EAC) if the project is expected to continue performing at the current Cost Performance Index (CPI)?
EAC = BAC / CPI.
What is the formula for calculating Estimate at Completion (EAC) when the project is expected to perform at the original budget rate?
EAC = AC + (BAC - EV)
Which cost estimating method is the most accurate but time-consuming?
Bottom-Up Estimating.
What term describes the predicted difference between the current cost baseline and the expected final project cost?
Variance at Completion (VAC).
What is the formula for calculating To-Complete Performance Index (TCPI) based on the budget at completion?
TCPI = (BAC - EV) / (BAC - AC)
