CH4

Question 1

____________ is the process of defining how the project costs will be

Answer 1

Plan cost management

Question 2

T/F: The key benefit of the project scope management process is to provide guidance and direction on how the project costs will be managed throughout the project.

Answer 2

F, plan cost management process not project scope

Question 3

The ______________ defines the project approval requirements, provides the pre approved financial resources that will influence the management of the project costs

Answer 3

project charter

Question 4

________ management plan establishes the criteria and the activities for developing, monitoring, and controlling the schedule.

Answer 4

Schedule

Question 5

T/F: Both the schedule management plan and the risk management plan provide processes and controls that will impact cost estimation and management.

Answer 5

True

Question 6

_______ management plan provides the approach for identifying, analyzing, and monitoring risks.

Answer 6

Risk

Question 7

The ___________________ factors are the organizational culture and structure, market conditions, currency exchange rates, etc.

Answer 7

Enterprise environmental

Question 8

____________________ are existing formal and informal cost estimating and budgeting related policies, procedures, and guidelines.

Answer 8

Organizational process assets

Question 9

T/F: Historical information and lessons learned repositories are enterprise environmental factors.

Answer 9

F, organizational process assests

Question 10

The plan cost management process (inputs/outputs) are project charters, project management plan, enterprise environmental factors, organizational process assets.

Answer 10

inputs

Question 11

The plan cost management process tools and techniques include ______________, ________________ and ________________.

Answer 11

Expert judgement, data analysis, meetings

Question 12

T/F: Expertise should be considered from individuals or groups with specialized knowledge or training in previous similar projects, earned value mangement, information in the industry, discipline, and application area or cost estimating and budgeting.

Answer 12

True

Question 13

____________ can include reviewing strategic funding options such as: self funding, funding with equity, or funding with debt.

Answer 13

Alternative analysis

Question 14

T/F: Expertise can also include consideration of ways to acquire project resources such as making, purchasing, renting, or leasing.

Answer 14

F, alternative analysis not expertise

Question 15

T/F: Project teams may hold planning meetings to develop the Cost management plan. Attendees may include the project manager, the project sponsor, selected project team members, selected shareholders, anyone with responsibility for project cost.

Answer 15

F, selected stakeholders not shareholders

Question 16

T/F: The cost management plan is the output of the plan cost management process.

Answer 16

True.

Question 17

The cost management plan is a component of the ____________ plan.

Answer 17

project management

Question 18

___________ is the process of developing an approximation of the cost of resources needed to complete project work.

Answer 18

Estimate costs

Question 19

The key benefit of the ____________ process is to determine the monetary resources required for the project.

Answer 19

estimate costs

Question 20

The tools and techniques of the estimate costs include _________ estimating, __________ estimating, ___________ estimating, _________ estimating.

Answer 20

analogous, parametric, three-point, bottom-up.

Question 21

___________ estimating uses a statistical relationship between relevant historical data and other variables

Answer 21

Parametric

Question 22

______________ estimating uses historical data from a similar activity or project

Answer 22

Analogous

Question 23

________ estimating is used when there is a limited amount of detailed information.

Answer 23

Analogous

Question 24

T/F: Analogous Estimating is more accurate and less time-consuming but more costly.

Answer 24

F, it is less costly and less time-consuming but less accurate.

Question 25

In ___________ estimating, the accuracy of single-point cost estimates may be improved by considering estimation uncertainty and risk.

Answer 25

Three-point

Question 26

T/F: Three-point estimating is used when there is a limited amount of detailed information and insufficient historical data.

Answer 26

True.

Question 27

__________ distribution:
E = (M + O + P) / 3

Answer 27

Triangular

Question 28

_______ distribution:
E = (O + 4M + P) / 6

Answer 28

Beta

Question 29

T/F: In the triangular and beta distribution, M stands for Most Likely Cost, O for Optimistic Cost, and P for Possible Cost.

Answer 29

F, P for Pessimistic Cost.

Question 30

Other tools and techniques that Estimate Costs process uses include data analysis, _______________ (PMIS), and decision making.

Answer 30

Project Management Information System

Question 31

___________ Estimating is a method of estimating project cost by aggregating the estimates of the lower level components of the WBS

Answer 31

Bottom-up

Question 32

T/F: Analogous estimating is the most accurate technique.

Answer 32

F, Bottom-up estimating not analgous.

Question 33

During bottom-up estimating, when an activity’s cost cannot be estimated with a reasonable degree of confidence, the work within the activity is decomposed into (more/less) detail.
The detail costs are estimated.
These estimates are then ___________ into a total quantity for each of the activity’s costs.

Answer 33

more, aggregated.

Question 34

____________ in estimate costs process is used to evaluate identified options in order to select which options or approaches to use to execute and perform the work of the project.

Answer 34

Data analysis

Question 35

T/F: Estimate cost data analysis allows the team to weigh resource, cost, and duration variables to determine an optimal approach for accomplishing project work.

Answer 35

True.

Question 36

Example of ____________ in estimate costs: evaluating the cost, schedule, resource, and quality impacts of buying versus making a deliverable.

Answer 36

Data analysis

Question 37

In ____________, Cost estimates may include contingency reserves to account for cost uncertainty

Answer 37

Reserve analysis

Question 38

In reserve analysis, contingency reserves budget is included (outside/within) the cost baseline that is allocated for identified risks.

Answer 38

within

Question 39

T/F: Contingency reserves are often viewed as the part of the budget intended to address the known unknowns that can affect a project. For example, rework for some project deliverables could be anticipated, while the amount of this rework is unknown

Answer 39

True

Question 40

________________ can include spreadsheets, simulation software, and statistical analysis tools to assist with cost estimating.

Answer 40

Project Management Information System (PMIS)

Question 41

The decision making techniques that can be used in the Estimate Costs process include _____.

Answer 41

voting

Question 42

_______ is an assessment process having multiple alternatives with an expected outcome in the form of future actions.

Answer 42

Voting

Question 43

T/F: Decision making techniques are useful for engaging team members to improve estimate accuracy and commitment to the emerging estimates.

Answer 43

True.

Question 44

The outputs of the Estimate costs process includes the ____________, and the ___________.

Answer 44

costs estimates, basis of estimates.

Question 45

Costs are estimated for all resources that are applied to the cost estimate includes: _________ costs (labor, materials, equipment, and services), _________ allowance , __________ rates, _______, and _______ costs

Answer 45

direct costs, inflation allowance, exchange rates, cost contingency reserve, indirect costs.

Question 46

_____________ is the process of aggregating the estimated costs of individual activities or work packages to establish an authorized cost baseline.

Answer 46

Determine budget

Question 47

The key benefit of the ___________ process is to determine the cost baseline against which project performance can be monitored and controlled.

Answer 47

determine budget

Question 48

The tools and techniques of the Determine Budget process includes _________, ___________, _________, and data analysis

Answer 48

Cost aggregation, Funding limit reconciliation, financing

Question 49

___________ is where cost estimates are aggregated by work packages in accordance with the WBS.

Answer 49

Cost aggregation

Question 50

The work package cost estimates are then aggregated for the [lower/higher] component levels of the WBS (such as control accounts) and, ultimately, for [some/all] the project.

Answer 50

higher, all.

Question 51

In reserve analysis, ______ reserve addresses the unknown unknowns that can affect a project.

Answer 51

Management

Question 52

T/F: Management reserve is for the unforeseen work that is within scope of the project.

Answer 52

True.

Question 53

T/F: Management reserve Is included in the cost baseline.

Answer 53

F, it is not but is part of the overall project budget.

Question 54

T/F: When an amount of management reserves is used to fund unforeseen work,the amount of management reserve used is added to the cost baseline, thus requiring an approved change to the cost baseline.

Answer 54

True

Question 55

_______________ in which the expenditure of funds should be reconciled with any funding limits on the commitment of funds for the project.

Answer 55

Funding Limit Reconciliation

Question 56

T/F: A variance between the funding limits and the planned expenditures will sometimes necessitate the rescheduling of work to level out the rate of expenditures.

Answer 56

True

Question 57

T/F: Financing entails acquiring funding for project.

Answer 57

True

Question 58

T/F: It is common for long-term infrastructure and industrial to seek _______ sources of funds. If a project is funded __________, the funding entity may have certain requirements that are required to be met.

Answer 58

External, externally.

Question 59

_____________ and __________ are the outputs of the determine budget process.

Answer 59

Costs baseline, project funding requirements.

Question 60

____________ is the approved version of the time phased project budget.

Answer 60

Costs baseline

Question 61

T/F: Costs baseline includes all management reserves.

Answer 61

F, excludes any management reserves.

Question 62

T/F: Costs baseline can only be changed through formal change control procedures.

Answer 62

True.

Question 63

T/F: Costs baseline is used as a basis for comparison to actual results.

Answer 63

True.

Question 64

Total funding requirements and periodic funding requirements (e.g., quarterly, annually) are derived from the ____________.

Answer 64

cost baseline

Question 65

T/F: The cost baseline will include projected expenditures plus anticipated liabilities.

Answer 65

True

Question 66

T/F: Funding often occurs in decremental amounts, and may not be evenly distributed, which appear as steps.

Answer 66

F, incremental not decremental.

Question 67

The total funds required are those included in the cost baseline plus ____________.

Answer 67

management reserves

Question 68

____________ is the process of monitoring the status of the project to update the project costs and managing changes to the cost baseline.

Answer 68

Control Cost

Question 69

The key benefit of the _____________ process is to maintain the cost baseline throughout the project.

Answer 69

Control Cost