Cost

Question 1

One common way to compute estimate at completion is to take the budget at completion and:

A. Divided by SPI
B.Multiplied by SBI
C. Multiplied by CPI
D. Divide by CPI

Answer 1

Divide by CPI

Question 2

The finance department requires that you keep them updated on the costs being spent on the capital project you are leading. You are required to submit a funding plan, and monthly forecast star necessary so that any changes to the funding plan can be requested in advance and evaluated. Exceeding the budget limit is unacceptable as it will impact the stock value. You have successfully implemented processes and practises to anticipate funding changes, and you evaluate them to minimize problems and increase the efficient use of funds. You have employed a variety of reporting and analysis techniques to meet the finance department requirements. One of them is EAC, which is a periodic evaluation of:

A. The cost of work completed.
B. The value of work performed.
C. They anticipated total cost at project completion
D. What it will cost to finish the project

Answer 2

The anticipated total cost at project complete

Question 3

The customer responsible for overseeing your project asks you to provide a written cost estimate that is 30% higher than your estimate of the project cost. He explained that the budgeting process requires managers to estimate pessimistically to ensure enough money is allocated for projects. What is the best way to handle this?

A. Add to 30% as a lump sum contingency fund to handle project risks
B. Add to 30% to your cost estimate by spreading it evenly across all project activities
C. Create one cost baseline for budget allocation and a second one for the actual project management plan
D. Ask for information on risks that would cause your estimate to be too low

Answer 3

Ask for information on risks that would cause the estimate to be too low

Question 4

You’ve recently been assigned to manage a marketing project to brand a sustainable development program. Even though you are just starting your efforts, the sponsors are concerned about the likelihood of recent planned milestones during the project. They are wondering how you will go about estimating. Analogous estimating:

A. Use bottom up estimating techniques
Be. Is used most frequently during project execution
C. Used top down estimating techniques
D. Calculate estimates using actual detailed historical costs

Answer 4

Uses top down estimating techniques

Question 5

Management has asked you to update the projected cost of running your agile team through the end of the project based on the latest project data. What information will you need from the team to update this estimate?

A. Resource management plan
B. Release plans
C. Burndown graph
D. Product backlog

Answer 5

Burn down graph

Question 6

You have been working with the subject matter expert‘s to estimate activity duration and costs on the project. All of the following are outputs of the estimate cost process except:

A. An understanding of the cost risk in the work that has been estimated.
B. The prevention of inappropriate changes from being included in the cost baseline
C. An indication of the range of possible costs for the project
D. Documentation off any assumption made during the estimate cost process

Answer 6

The prevention of inappropriate changes from being included in the cost baseline

Question 7

You are managing a project to develop a new mobile application for the inventory tracking and control system of a restaurant franchise organization. Schedule is the highest priority constraint for the leader ship team, but the franchise owners are most concerned about cost and the quality of the application. If there are bugs and errors in the system, they will pay higher cost on waste or lost sales. But investing a lot of effort into delivering great functionality could be expensive. It was decided that an adaptive approach to the project lifecycle would likely be the best way to balance the competing priorities and deliver a working, cost-effective application. The franchise decision team has been meeting with the development team. The groups feel good about the projects progress, but they are hearing concerns from other stakeholders about what the impact will be to the bottom line and whether the system will be ready for launch. These concerns were anticipated in planning, and will be managed with cost performance measurement. Cost performance measurement is best done through which of the following?

A. Asking for a percent complete from each team member and reporting that in the monthly progress report
B. Calculating on value, and using index is and other calculations to report past performance and forecast future performance.
C. Using the 50-50 rule, and making sure the lifecycle cost is less than the project cost
D. Focussing on the amount expended last month and what will be expended the following month

Answer 7

Calculate an earned value, and using indexes and other calculations to report past performance and forecast future performance

Question 8

A CPI of 0.89 means:

A. At this time, we expect the total project to cost 89% more than planned
B. When the project is completed, we will have spend 89% more than planned
C. The project is progressing at 89% of the red planned
D. The project is getting $.89 out of every dollar invested

Answer 8

The project is getting $.89 out of every dollar invested

Question 9

Which of the following is an example of a parametric estimate:

A. Dollars per module
B. Learning bend
C. Bottom up
D. CPM

Answer 9

Dollars per module

Question 10

A rough order of magnitude estimate is made during which project management process group?

A. Planning
B. Closing
C. Executing
D. Initiating 

Answer 10

Initiating

Question 11

For each activity on your project, you have worked with designers, engineers, technical experts and Consultants to come up with details on the resources needed to complete the activity quote. For some of the activities the lists are quite long, as you need raw and finished materials, equipment, and people. You have a limited amount of warehousing available, so you have to coordinate the deliveries and work so that the materials and equipment are delivered as close to the start of inactivity as possible. You and the project management team have identified the amount of time and money needed for each of the activities, which you have done aggregated and analyzed with their help. These efforts will eventually result in the creation offer cost baseline for the project. A senior manager is trying to better understand the work of project management and has asked which process produces the cost baseline. What is the correct response?

A. Estimate activity resources
B. Estimate costs
C. Determine budget
D. Control costs

Answer 11

Determine budget

Question 12

Project set up costs are an example of:

A. Variable costs
B. Fixed costs
C. Overhead costs
D. Opportunity costs

Answer 12

Fixed costs

Question 13

The quality efforts on the project have gone through some changes during the first four months of project work. Two processes in particular have undergone extensive change. The customer is happy with the work to date, but has heard that the competition is working on a similar product. The team has been asked to analyze and create options for the customer. Value analysis is performed to get:

A. More value from the cost analysis
B. Management to buy into the project
C. The team to buy into the project
D. A less costly way of doing the same work

Answer 13

A less costly way of doing the same work

Question 14

A project management team is busy breaking down deliverables, and the procurement department has started looking for possible sellers to help produce the deliverables. There are departmental concerns that the project could go over budget because the scope will be iterated and the planning and development will be done in increments. At a recent company gathering, the sponsor asked questions of the project manager and the project management staff team about how changes in scope will affect the estimates. The sponsor wanted to know how to project estimates could be relied upon, given that they were planning to iterate the scope. The project manager reassured them that the team has the right tools with which to provide accurate estimates, and will utilize the toes throughout the project. Which of the following is not needed in order to come up with a project estimate?

A. A WBS
B. A network diagram
C. Risks
D. Change requests

Answer 14

Change requests

Question 15

Which estimating method tends to be most costly for creating a project cost estimate?

A. Bottom up
B. Analogous
C. Parametric
D. 5050

Answer 15

Bottom up

Question 16

To get a clear indication of how the project is progressing, the buyer expects periodic reporting that includes analysis of the work that has been accomplished according to plan, the dollars that have been spent and how they reflect the planned expenses, the excepted deliverables, and evaluation of the risk events that have occurred. Which of the following represents the estimated value of the work actually accomplished?

A. Earned value
B. Planned value
C. Actual cost
D. Cost variance

Answer 16

Earned value

Question 17

The teams velocity for the first eight 2-week sprints of your 46 week hybrid project are 30, 60, 57, 44, 33, 48, 41 and 49 should you be concerned about how do you‘s results will impact the cost of the project? What should you do about this?

A. Yes, there’s too much variation for reliable cost projections. Consult with your projects budget office.
B. Possibly. Compare these velocity rates to the team original estimates at the start of the project
C. No. There is no need for action since team velocity has no impact on the cost of a project
D. Probably. But before taking action, convene a meeting and ask the team members what is happening

Answer 17

Possibly. Compare these velocity rates to the team’s original estimates at the start of the project

Question 18

Which of the following are all items included in the cost management plan?

A. The level of accuracy needed for estimates, rules for measuring cost performance, and specifications for how duration estimates should be stated
B. Specifications for how estimates should be stated, Rules for measuring cost performers, and the level of accuracy needed for estimates
C. Rules for measuring team performance, the level of accuracy needed for estimates, and specifications for how estimate should be stated
D. Specifications for how estimates should be stated, the level of risk need it for estimates, and rules for measuring cost performance

Answer 18

Specifications for how estimates should be stated, rules for measuring cost performers and the level of accuracy needed for estimates

Question 19

Your project has a medium amount of risk and isn’t very well defined. The sponsor hands to a project charter and asks you to confirm that the project can be completed within the project cost budget. What is the best method to handle this?

A. Develop an estimate in the form of a range of possible results
B. Ask the team members to help estimate the cost based on the project charter
C. based on the information you have, calculate a parametric estimate
D. Provide an analogous estimate based on past history

Answer 19

Develop an estimate in the form of a range of possible results

Question 20

You are leading a project to introduce a new healthcare appointment scheduling application. As you are creating plans detailing how the team will respond to possible events that may impact the project, you and the team determine the amount of cost contingency reserve needed. The cost contingency reserve should be:

A. Hidden to prevent management from disallowing the reserve
B. Added to each activity to provide for the customer with a shorter critical path
C. Maintained by management to cover cost overruns
D. Added to the cost of the project to account for risks

Answer 20

Add it to the cost of the project to account for risks

Question 21

You are having difficulty estimating the cost of a project. Which of the following best describes the most probable cause of your difficulty?

A. Inadequate scope definition
B. Unavailability of desired resources
C. Lack of historical records from previous projects
D. Lack of company processes

Answer 21

Inadequate scope definition

Question 22

Your cost forecast shows you will have a cost overrun at the end of the project. Which of the following should you do?

A. Eliminate risks in estimate and re-estimate
B. Meet with the sponsor to find out what work can be done sooner
C. Cut quality
D. Decrease scope

Answer 22

Eliminate risks in estimate and reestimate

Question 23

Early in the life of your project, you are having a discussion with the sponsor about what estimating techniques should be used. You want a form of expert judgment, but the sponsor are used for analogous estimating. It would be best to:

A. Agree to analogous estimating, as it’s a form of expert judgement
B. Suggest lifecycle costing as a compromise
C. Determine why the sponsor want such an accurate estimate
D. Try to convince the sponsor to allow expert judgement because it is typically more accurate

Answer 23

Agree to analogous estimating, as it is a form of expert judgement

Question 24

You have just completed the initiating processes of a small project and are moving into project planning when a project stakeholder asks you for the projects budget and cost baseline what should you tell her??

A. The project budget can be found in the project charter, which has just been completed
B. The project budget and baseline will not be finalized and accepted until the planning processes are completed
C. The project management plan does not contain the project budget and baseline; this is a small project
D. It is impossible to complete an estimate before the project management plan is created

Answer 24

The project budget and baseline will not be finalized and accepted until the planning processes are completed

Question 25

The project manager is working with cost estimates in order to establish a baseline formation project performance. What process is this? A. Cost management B. Estimate costs C. Determine budget D. Control costs

Answer 25

Determine budget

Question 26

Monitoring cost expended to date in order to detect variances from the plan occurs during: A. the creation of the cost change control system B. Recommend correct actions C. Updating the cost baseline D. Project performance reviews

Answer 26

Project performance reviews

Question 27

A manufacturing project has a schedule performance index of 0.89 and a cost performance index of 0.91. Generally, what is the most likely explanation for why this occurred? A. The scope was changed B. A supplier went out of business and a new one needed to be found C. Additional equipment needed to be purchased D. A critical path activity took longer needed more labour hours to complete

Answer 27

A critical path activity took longer needed more labour hours to complete

Question 28

Although the stakeholders thought there was enough money in the budget, Half it to the project the cost performance index is 0.7. To determine the root cause, several stakeholders audit the project and discovered the project cost budget was estimated analogously. Although the activity estimates add up to the project estimate, the stakeholder think something was missing in how the estimate was completed. Which of the following describes what was missing? A. Estimated costs should be used to measure CPI B. SPI should be used, not CPI C. Bottom up estimating should’ve been used D. Past history was not taking into account

Answer 28

Bottom up estimating should’ve been used

Question 29

In analyzing problems that have occurred doing testing, the team discovered that cause-and-effect diagraming is helpful in identifying the best place to focus their efforts. The coordination of the interrelationships of the deliverables has improved, and the team has discovered efficiencies that have been shared with other projects and the organization for process improvement. This has made a difference in how well the project is aligning to the performance measurement baseline. Stakeholders are anticipating that control effects and reporting on future projects will be easier. Earned value analysis is the basis for: A. Performance reporting B. Planning control C. Ishikawa diagrams D. Integrating the project components into a whole

Answer 29

 performance reporting

Question 30

The replacement of the inventory management and portion control system for an international restaurant chain has been prioritized as a key strategic objective for the organization. The stakeholders are very concerned about many aspects of the project. They have shared these concerns and ideas in workshops, focus groups, emails and service. Identified risks are: A. An input to the estimate cost process B. An output of the estimate costs process C. Not related to the estimate cost process D. Both an input and an output of the estimate cost process

Answer 30

Both an input and an output of the estimate cost process

Question 31

There is confusion among some of the stakeholders about how the cost forecast will be calculated on the project. They also have concerns about whether enough money has been set aside to cover the cost of risk responses. You are planning to share information in the upcoming team meeting and in reports to stakeholders To clear up the confusion. You are referencing the stakeholder and communications management plan to determine how best to communicate with the stakeholders. You were explained that the difference between the cost baseline and the cost but it can be best described as: A. The management reserves B. The contingency reserves C. The project cost estimate D. the cost account

Answer 31

The management reserves

Question 32

You provide a project cost estimate for the project to the project sponsor. He is unhappy with the estimate, because he thinks the price would be lower. He asks you to cut 15% off the project estimate. What should you do? A. Start the project and constantly look for cost savings B. Tell all team members to cut 15% from their estimates C. Inform the sponsor of the activities to be cut D. Add additional resources with low hourly rates

Answer 32

Inform the sponsor of the activities to be cut

Question 33

Cost risk means: A. There are risks that will cost the project money B. The project is too risky from a cost perspective C. There is a risk that project cost could go higher than planned D. There is a risk that the cost of the project will be lower than planned

Answer 33

There is a risk that project cost could go higher than planned

Question 34

A project manager is analyzing the project to find ways to decrease cost. It would be best of the project manager looks at: A. Variable cost and fixed cost B. Fixed cost and indirect cost C. Direct cost and variable cost D. Indirect cost and direct cost

Answer 34

Direct cost and variable cost

Question 35

You’re thinking through what approach will make it easiest for the team to take responsibility for providing for performance data for all aspects of the project. As part of this approach, you believe it will be helpful to make sure the team understands how and why the data will be analyzed. You explain to the team that the cost management plan contains a description of: A. The project cost B. How resources are allocated C. The budgets and how they are calculated D. The WBS level at which earned value will be calculated

Answer 35

The WBS level at which earned value will be calculated

Question 36

A project manager creates a component-specific tool to verify that a set of required steps has been performed. This tool is called a: Plan-Do-Act-Check Checklist Risk Register Assumptions log

Answer 36

Checklists are structured tools used to verify that a set of required steps has been performed. Checklists can be either simple or complex. Many organizations have standardized checklists to ensure consistency in frequently performed tasks.

Question 37

A first-time project manager is advised by an experienced project manager to plan for cost of quality. The first-time project manager is not sure which costs are included in the cost of quality. What would your advice be? Cost of quality only includes prevention costs and internal failure costs. Cost of quality includes cost of conformance and cost of nonconformance. Cost of quality only includes cost of conformance. Cost of quality only includes cost of nonconformance.

Answer 37

Cost of quality includes cost of conformance and cost of nonconformance. Cost of quality (COQ) includes all costs related to quality management activities and quality issues incurred over the life of a product. It includes cost of conformance (prevention and appraisal costs) as well as cost of nonconformance (internal and external failure costs).

Question 38

All of the following are parts of the control quality process except Control charts and cause and effect diagrams. Performance review and statistical sampling Cost of quality and checklists Inspection and histograms.

Answer 38

Cost of quality is only used in the Plan Quality Management process. It involves looking at what the costs of conformance and nonconformance to quality will be on the project and creating an appropriate balance.

Question 39

Which of the following represents information presented in its order of priority and helps focus on the most difficult issues? A flowchart A fishbone diagram A control chart A Pareto diagram

Answer 39

A flowchart does not show order of importance. A fishbone diagram identifies possible causes of problems. A control chart displays process results over time.

Question 40

Cause-and-Effect diagrams are used to illustrate how various factors might link to potential problems or effects. They are also called: Process diagrams Ishikawa diagrams Pareto diagrams Taguchi diagrams

Answer 40

Ishikawa diagrams Cause and effect diagrams are also called ishikawa diagrams.

Question 41

The widget production project ¡s well underway. The requirements are clear that each widget must weigh between 0.320 and 0.325 ounces. The first day of test production resulted in 1247 widgets. Of the widgets inspected, 47 percent fell within the acceptable weight range. This is an example of? Control charting Quality assurance Corrective action Control limits

Answer 41

The situation described would occur as part of quality control, not quality assurance (choice Quality assurance). The question specifically describes control limits, which are only a part of control charting (choice Control charting). Corrective action is needed. but it is not described here.

Question 42

Your company is in the consumer-packaged goods industry. This is a highly regulated industry, and the regulations can vary between countries and even geographic regions within each country. You have created a new product and sent the first shipment to a customer in a region you have never worked in before. The shipment is stopped in customs, due to the product not meeting the standards of that country. According to the company policy, samples should be taken from each shipment and stored for six months. The company looked for samples from the shipped product, and were not able to locate any. Which quality technique could have caught this issue Quality audits Control charts Process analysis Matrix diagrams

Question 43

Which of the following should be avoided while applying logical relationships to project activities: Applying the SF relationship Applying the SS relationship with a lag Applying the SS relationship with a lead Applying multiple relationships between the same activities

Answer 43

Applying multiple relationships between the same activities Multiple relationships between the same activities are not recommended, so a decision has to be made to select the relationship with the highest impact. Closed loops are also not recommended in logical relationships. The other choices are valid approaches.

Question 44

Work on a project is ongoing when the project manager overhears two workers arguing over what a set of instructions mean. The project manager investigates and discovers that the instructions for the construction of the concrete footings currently being poured were poorly translated between the different languages in use on the project. Which of the following is the best thing for the project manager to do first? Get the instructions translated by a more experienced party Inform the sponsor of the problem in the next project report Look for quality impacts of the poorr translation of the instructions for the footings Bring the issue to the attention of the team and ask them to look for other translation problems

Answer 44

Though all of these choices are correct things to do, the question asks what to do first. What is the most immediate problem? Isn't it most urgent to find out whether the concrete footings meet your project requirements?

Question 45

If a data point falls outside the upper control limit of a control chart the process is said to be: Assigned a cause In control Out of contrrol Gold plated

Answer 45

Out of control Choice "Assigned a cause" couldn't be right, as the process is not assigned a cause, the data point is. Read the questions carefully!

Question 46

Which of the following quality control tools and techniques may not be used for root cause analysis? Ishikawa diagram Fishbone diagram Scatter diagram Cause-and-effect diagram

Answer 46

Scatter diagram Of the tools listed, the scatter diagram is used to study and identify the possible relationship between two variables. The others can be used for root cause analysis.

Question 47

A project manager is gathering data with the team to determine how various factors might be linked to potential problems. In what part of the quality management process is the project manager working? Quality Analysis Manage Quality Plan Quality Management Control Quality

Answer 47

Plan Quality Management

Question 48

All of the following are examples of the cost of nonconformance except: Rework Scrap Quality training Warranty costs

Answer 48

Quality training All the other choices are costs of nonconformance to quality.

Question 49

You are in the execution stage of your project, and you are informed that “corporate” will send in a team of consultants to review whether your project activities comply with your company’s and PMI’s policies, standards, and procedures. This is an example of: Organizational Process Assets Quality Audit Recommended Corrective Actions Process Analysis

Answer 49

Quality Audit Any activity that is a structured and independent review to examine the project is an example of a quality audit. A quality audit is a quality management tool.

Question 50

During the completion of the project work. A project manager wants to ensure that the quality of the end product is acceptable. The best way to do this is by: Checking quality against the standards set in the quality plan. Identifying the quality standards you want the end product to meet. Performing cost-benefit analysis. Determining the cause of a problem using a fishbone diagram.

Answer 50

Checking quality against the standards set in the quality plan. Did you notice the situation is occuring during completion of project work? Choices ' Identifying the quality standards you want the end product to meet.' and 'Performing cost-benefit analysis.' occur earlier. Choice 'Determining the cause of a problem using a fishbone diagram.' does not deal with the quality of the end product of the project, it deals with quality problems that arise

Question 51

Quality is achieved when: The customer stops asking for additional features Customer expectations have been exceeded The customer indicates acceptance of the product or service The requirements have been met

Answer 51

The requirements have been met Quality is defined as conformance to requirements and specifications. The best answer here is when the requirements have been met. We do not achieve quality if we exceed expectations, get a verbal OK or stop adding features requested by the customer.

Question 52

You are managing an engineering design project. The vendor has created 50 engineering drawings. Since the project is on a tight schedule and budget, checking every drawing for accuracy and completeness would be impossible. You direct the team to randomly select 20 drawings for inspection. This exercise can best be described as an example of: Inspection Control charting Attribute sampling Statistical sampling

Answer 52

Statistical sampling This scenario is an example of statistical sampling since it involves the team selecting 20 out of 50 engineering drawings at random to measure accuracy and completeness. Statistical sampling is among the data gathering techniques that can be used as part of the Control Quality process. Statistical sampling is often applied when inspecting the entire population would be too costly or time-consuming. In this instance, given that the project is on a tight schedule and budget, statistical sampling makes sense to use to inspect the engineering drawings.

Question 53

All of the following are part of the perform quality control process except? Pareto charts Control charts Inspection Quality audits

Answer 53

Quality audits are part of perform quality assurance.

Question 54

A control chart shows seven data points in a row on one side of the mean. What should be done? Nothing. This is the rule of seven and can be ignored. Adjust the chart to reflect the new mean. Perform a design of experiments. Find an assignable cause

Answer 54

Find an assignable cause. The rule of seven applies here. If you have seven data points in a row on the same side of the mean, statistically, the mean has shifted, calling for aciton to correct the problem.

Question 55

A very successful software company has penetrated the market by selling an easy-to-use, medium-priced product. They are now trying to expand their market share by creating a new product line. A software application in this new product line is in the final phase of development. In a review with potential end users, the reviewers indicate that the software is lacking in features. The product has no defects, was easy to use, and met all of the quality requirements. Were the end users correct in calling the product low quality? No, the product is considered to be a low grade No, the product meets requirements so end users should accept the product Yes, the product requirements were wrong. Yes, the product is of low quality

Answer 55

This is an example of grade, which refers to a general classification for a deliverable. In this case, the software had no defects and met the stated requirements. This does not mean the end users should accept the software as is. But the issue is a disagreement about requirements, not quality.

Question 56

A team is using a fishbone diagram to help determine what quality standards will be used on the project. What part of the quality management process are they in? Perform quality assurance Quality planning Variable analysis Perform quality control

Answer 56

Quality planning The key phrase here is "will be used." The team is looking to the future of what quality will be on the project and therefore must be in quality planning, Choice "Quality planning"

Question 57

A project manager has acquired a tremendous amount of project information through data gathering and analysis during the project. He charts this information over time. For which of the following is the project manager most likely to use this information? Trend analysis Benchmarking Variance analysis Decision trees

Answer 57

Trend analysis examines project results over time to evaluate performanace.

Question 58

A project manager ¡s having problems with how two of the parts fit together on the new computer and the software uploads to the system. To plan a strategy for resolving these problems, it is best to determine if the problems are: Statistically independent. Nonconforming. Normally distributed. Impacting quality.

Answer 58

Choice 'Nonconforming' and 'Impacting quality' are already stated, because the two items are listed as problems. They may be true, but they are not answers to the question. It would be best to determine if the problems are related (choice 'Statistically independent') before planning what to do about them.

Question 59

Who is ultimately responsible for quality management on the project? The team member The project engineer The project manager The quality manager

Answer 59

Though each person working on the project should check their own work as part of any project, the project manager ultimately has the responsibility for quality on the project as a whole.

Question 60

A software team tracing the root cause of an application failure can use this to help determine the cause(s) of the failure: Deming chart Rummler-Brache swim lane diagram Threading analysis Ishikawa diagram

Answer 60

Ishikawa diagram Cause-and-effect diagrams, also called ishikawa diagrams, illustrate how various factors might be linked to potential problems or effects.

Question 61

The team is working on a process improvement project for the organization. Similar projects have been completed in the past, although all of the team members on this project are new to the organization. The project manager has taken advantage of historical records from the previous projects, and is making use of templates and other documentation found in those records, management wants to look at how project is doing, as compared to past projects. To make a valid judgment, management should compare this project to: Flowcharts Bar charts Trend charts Benchmarks

Question 62

As part of the quality control in your project, you are exploring a technique that shows the history and pattern of variation. This is a line graph that shows data points plotted in the order in which they occurred. You are most likely looking at a: Histogram Cause-and-effect diagram Control chart Pareto diagram

Answer 62

Control chart This is most likely to be a control chart. A control chart shows the trends in a process over a period of time. The remaining choices are not line graphs.

Question 63

All the following are tools of control quality except: Inspection Cause-and-Effect diagram Histogram Mind mapping

Answer 63

Mind mapping Tool of Control quality: -Seven basic quality tools: Flow chart, histogram, Cause and effect diagram, check sheet, scatter diagram, control chart, pareto chart -Inspection -Statistical sampling -Approved change request review Mind mapping helps improve a process, an individual or group to think through many different issues, and simultaneously keep them all in mind. This tool creates a visual representation of many issues and helps a group get a more complete and common understanding of the situation.

Question 64

Which of the following tools can enhance the visibility of traditional written project plans and other documents to provide a real-time overview of the project status? Expert judgement Visual management tools Change control system Product backlog

Answer 64

Some project teams use visual management tools, rather than written plans and other documents, to capture and oversee critical project elements. Making key project elements visible to the entire team provides a real-time overview of the project status.

Question 65

To look backward at what may have contributed to quality problems on the project, the team may use which of the following? Performance measurement baseline Cost of quality Affinity diagrams Cause-and-effect diagram

Answer 65

Cause-and-effect diagram These three baselines (time, cost, scope) put together are called the Performance Measurement Baseline, which is established as part of the overall project management plan. Cost of quality (COQ) is defined as a methodology that allows an organization to determine the extent to which its resources are used for activities that prevent poor quality, that appraise the quality of the organization’s products or services, and that result from internal and external failures. Having such information allows an organization to determine the potential savings to be gained by implementing process improvements. A cause and effect diagram examines why something happened or might happen by organizing potential causes into smaller categories. It can also be useful for showing relationships between contributing factors. The Affinity Diagram is a method which can help you gather large amounts of data and organise them into groups or themes based on their relationships

Question 66

The paint on the exotic cars that are manufactured in your plant is bubbling about a year after application. What would be the best tool for your team to use to find potential causes of the peeling paint? Control Chart Inspection Scatter diagram Ishikawa Diagram

Answer 66

All the choices are tools and techniques in quality control; however, the best choice would be the ishikawa or cause-and-effect diagram.

Question 67

The line in the middle of a control chart is called the: Mean Specification limit Rule of seven Upper and lower control limit

Answer 67

The MEAN is the correct answer. The specification limits are above and below the mean. The rule of seven indicates that a process is out of control. The upper and lower control limits are above and below the mean but are within the specification limits.

Question 68

Which process group corresponds to the "Act" component of the Plan-Do-Check-Act cycle? Monitoring & Controlling Planning Executing Initiating

Answer 68

The "ACT" component of the plan-do-check-act cycle relates to the executing process group. The plan-do-check-act cycle was created by shewhart and modified by deming to illustrate how different results from one cycle become an input to another cycle.

Question 69

Generally, where should control limits be located on a control chart? Above the normal curve Near the assignable cause Above the statistical independence point Within the specification limits

Answer 69

Within the specification limits The control limits are the dashed lines above and below the mean. Choice "Within the specification limits" is the only answer to address this correctly. Since control limits are the measure you use to determine quality, it follows that your quality should exceed your customer's need. Otherwise you probably would not do the work.

Question 70

Which of the following is Deming's method for continuous improvement? Check-Plan-Do-Act Plan-Act-Check-Do Plan-Do-Check-Act Plan-Check-Do-Act

Answer 70

Plan-Do-Check-Act Deming's model is Plan-Do-Check-Act.

Question 71

The validate scope process is different than the control quality process in that: Scope validation is provided to the project management team, while quality control is provided to the project Validate Scope is performed during project executing, and Control Quality is done throughout the project Control Quality is considered part of Plan Quality Management, while Validate Scope is not Control Quality focuses on the quality of the project, while Validate Scope focuses on customer acceptance

Answer 71

Control Quality focuses on the quality of the project, while Validate Scope focuses on customer acceptance Control Quality focuses on the quality of the project, while Validate Scope focuses on customer acceptance

Question 72

You are working for a medical device company. These products are strictly regulated, and the potential cost of litigation if defective equipment were to reach market is very high. In your new product development, you have completed the product design, and are testing a small initial production test run. The defect rate is higher than estimated. You are looking at several alternatives including changes in design, changes in policy, changes in procedures, and changes in standards. In order to determine if these changes would provide a positive result, you will start by using Affinity diagrams Scatter diagrams Cost of nonconformance Document analysis

Answer 72

Before investing resources into making changes to any aspect of the project, you must first determine the cause(s) of the high defect rate. You would begin by performing root cause analysis. Affinity diagrams help you organize and group the results of root cause analysis; therefore, the best answer is affinity diagrams

Question 73

You work at a software company that authors Material Safety Data Sheets (MSDS) for chemical companies. Prior to releasing the MSDS to the company, you have created a list of items for review to ensure they appear in the document. These items include chemical name, CAS#, protection required, what to do in an emergency, etc. This list is an example of what type of tool? Process Improvement Plan Quality Metrics Quality Management Plan Checklist

Answer 73

Checklist The scenario describes a checklist that someone would use to review the document prior to its release.

Question 74

A project manager is working with quality professionals in the perform quality assurance process of the project. Which of the following activities is being performed/ Evaluating quality against the processes Determining if the right processes are being used Determining what processes should be used Perform quality control

Answer 74

Determining if the right processes are being used The perform quality assurance process is the process in which we do quality audits to make sure we are using the correct processes. Choice "Determining what processes should be used" is quality planning and choice "Evaluating quality against the processes" is perform quality control.

Question 75

What might historical records from previous projects used as an input to activity definition include? Activities Resources Schedule Costs

Answer 75

Activities This question is worded strangely! Get used to it because you will have many instances where it will take you two minutes to figure out what the question is asking. Let alone come up with the best answer.

Question 76

In quality terms, one of the meanings of “out of control” is: A data point on a control charts falls inside the upper or lower control limit. Several data points fall on the same side of the mean within the upper and lower control limits. Someone on the team is upset. A data point is within 1 sigma

Answer 76

Several data points fall on the same side of the mean within the upper and lower control limits. A process is out of control when a point falls outside the upper or lower control limits on a control chart (choice "several data points fall on the same side of the mean within the upper and lower control limits.") or when seven consecutive data points fall on the same side of the mean. This term refers to control limits. not human resource issues (choice "Someone on the team is upset"). Choice "a data point on a control charts falls inside the upper or lower control limit." is an example of "in control." Choice "a data point is within 1 sigma" is not a relevant data point.

Question 77

You are the program level manager with several project activities underway. In the executing process group, you begin to become concerned about the accuracy of progress reports from the projects. What would best support your opinion that there is a problem? Quality audits Risk quantification reports Monte Carlo analysis Regression analysis

Answer 77

Quality audits are a necessary part of quality assurance to improve project performance quality.

Question 78

The project manager and one of the team leads are preparing some questions to ask the team that implemented the statistical sampling test. Since the results were different than expected, they want to be sure all those involved in the implementation followed the instructions properly. Which of the following are they involved in Mange Project Knowledge Control Quality Mange Quality Validate Scope

Answer 78

Manage Quality is the correct choice, as it is concerned with the use of proper processes.

Question 79

A project manager has just taken over the project from another project manager during the executing process group. The previous project manager created a project budget. Determined communications requirements and went on to complete work packages. What should the new project manager do next? Coordinate performance of work packages. Identify quality standards. Begin risk identification. Execute the project management plan

Answer 79

Identify quality standards. Perfomiance of work packages (choice Coordinate performance of work packages.) is done after project planning. Since the previous project manager did not finish planning, choice "Execute the project management plan" should not be next. Risk identification (choice Begin risk identification.) sounds like a good choice. however, identify quality standards (choice Identify quality standards.) occurs before choice "Begin risk identification.". The best answer is "Identify quality standards".

Question 80

You are asked to select tools and techniques to implement a quality assurance program to supplement existing quality control activities. Which of the following would you choose? Quality audits Trend analysis Pareto charts Statistical sampling

Answer 80

Quality audits are structured reviews of quality management activities performed to identify lessons learned that can he applied to this and other projects. Statistical sampling, Pareto charts and Trend analysis are tools and techniques that apply to quality control rather than quality assurance.

Question 81

An effective quality audit should be: Structured and internal Structured and independent Informal and internal Informal and independent

Answer 81

Structured and independent To provide the best results, a quality audit should be a structured process performed by an independent entity.

Question 82

Which of the following helps a project manager determine possible causes of potential problems and actual problems? The 50/50 rule A Pareto chart A fishbone diagram A control chart

Answer 82

The fishbone diagram is used to stimulate thinking and determine the cause of defects and look for solutions to problems. The 50/50 rule is used or estimating work package completion. A control chart displays results over time of a process. A Pareto chart displays causes of problems and the frequency of occurrence.

Question 83

The team is working through the planning processes. They are using a plan-driven approach to this system-critical change that will impact security and data protection. They are concerned about getting as much information as possible for their work. They are meeting today to begin planning for quality on their project. All of the following are inputs to the plan quality management process except: Guidelines and standards and the stakeholder register Project work results and lessons learned repository The project charter and the WBS The project statement and requirements documentation

Question 84

The team had a difficult time developing a work breakdown structure for the project because they were faced with complex product requirements. In addition, they had to adhere to management-imposed time and cost constraints on the project. Now, the project manager and his team are using an ishikawa diagram, trying to determine how various factors might have contributed to project problems. The project manager is involved in which part of the quality management process Control quality Utilize Quality tools Manage quality Plan quality management

Answer 84

The team is addressing problems that have impacted the quality on the project, so they must be in Control Quality.

Question 85

Control charts are used to determine the stability of a process. Which of the following best describes the range of the control limits applied on a control chart? The control limits are determined using statistical calculations. The control limits are provided by the customer. The control limits are based on cost tolerance. The control limits are determined using design for X.

Answer 85

The control limits are determined using statistical calculations.

Question 86

Which of the following tools and techniques is useful to process work performance data to identify sources of project defects during the Control Quality process? Salience model Data analysis Schedule model Communication model

Answer 86

Data analysis The question is asking for a tool and technique used during the control quality process. Data analysis is a tool and technique of the control quality process used to identify source of defects.

Question 87

Quality is: The degree to which the project meets requirements Meeting and exceeding the customer's expectations Conformance to management's objectives Adding extras to make the customer happy

Answer 87

The degree to which the project meets requirements Choices "Adding extras to make the customer happy" and "Meeting and exceeding the customer's expectations" cannot be the best, because there can be a cost impact (or time, risk etc,) of exceeding expectations or adding extras. Since a project should meet requirements, Choice "The degree to which the project meets requirements" is the best.

Question 88

A project manager wants to proactively monitor a manufacturing process to determine whether the quality level is within acceptable limits for that process. What tool will help with this? Ishikawa diagram PERT chart Histogram Control charts

Answer 88

Control charts Control charts can be used to monitor any type of output variable and process performance.

Question 89

A project manager and his team are using an ishikawa diagram, trying to determine how various factors might be linked to potential problems. The project manager is involved in which part of the quality management process? Quality tools Perform quality assurance Quality planning Perform quality control

Answer 89

The team is addressing potential problems, so they must be in quality planning.

Question 90

Which of the following is the true of inspections? They may not be conducted by the project team. They test future desires of prospective customers. They prevent defective deliverables from reaching the customer. They can only be conducted on the final product

Answer 90

They prevent defective deliverables from reaching the customer. Inspections may be conducted at any level including the project team, and at any time throughout the product development. They are used to prevent defects from being delivered to the customer.

Question 91

Project has faced major difficulties in the quality of its deliverables. Management now states that quality is the most important project constraint. Lf another problem with quality were to occur. What would be the best thing for the project manager to do? Allow cost to increase by fixing the root cause of the problem Allow the schedule to slip by cutting cost Allow risk to increase by cutting cost Fix the problem as soon as possible.

Answer 91

Many people would pick choice "Fix the problem as soon as possible.". It is proactive, but choice "Allow cost to increase by fixing the root cause of the problem" mentions root cause and the probable effect of dealing with the problem. If a problem with quality occurs again. some other project constraintlsl must change to accommodate fixing the problem. Choice "Allow the schedule to slip by cutting cost" is partially correct (allow schedule to slip). but may not need tooccur because the project manager might be able to compress the schedule in other areas. Besides. cutting cost does not necessarily cause the schedule to slip. Choice "Allow risk to increase by cutting cost" is not best because a quality problem is most likely to create additional cost, not cut cost

Question 92

Evaluating overall project performance regularly is part of: Quality management. Quality planning. Quality control. Quality assurance.

Answer 92

The key word here is "overall". Quality control is wrong because we are not addressing the specific performance of an activity.

Question 93

You are a project manager who is in charge of an important project for your company. The project includes producing widgets for your customer. The collected data helps identify the greatest causes of defects in the overall process. Which technique should you use to determine the correlation between two variables being analyzed? Statistical sampling Control chart Pareto chart Scatter diagram

Answer 93

Scatter diagram Scatter diagrams are used to determine if a correlation exists between two variables.

Question 94

The code development phase of a software project is nearly complete when the first code review is conducted. During the review, it is discovered that the application is missing functionality required to complete a key business process. However, the product scope never specified this functionality. What should the project manager do? Reject the functionality as out of the projects scope. Assess the impact on the project of including the functionality. and inform the sponsor. Agree to include the functionality in the next release. Agree to include the functionality in the current release.

Answer 94

Assess the impact on the project of including the functionality. and inform the sponsor. A project manager must always evaluate the situation before recommending a corrective action or a change.

Question 95

Design of experiments: Determines the methods to be used for research and development. Identifies which variables have the most influence on a quality outcome. Determines what a quality outcome is. Identifies which variables have the least influence on a quality outcome.

Answer 95

Identifies which variables have the most influence on a quality outcome. Experiments are a method for R&D (Choice "Determines the methods to be used for research and development.") but the most correct answer is choice "Identifies which variables have the most influence on a quality outcome." Proper design allows you to find those factors that have the most impact on quality. It allows the project manager to focus attention on the factors that are most important.

Question 96

In planning your project, which would generally have the highest priority: quality, cost or schedule? Cost is most important, quality next, and then schedule. Quality ¡s more important than cost or schedule. Schedule is most important. quality next, and then cost. It should be decided for each project.

Answer 96

It should be decided for each project. This can be a tricky question. in that most project managers dismiss the need to focus on quality. Quality, cost and schedule should be considered of equal importance unless specific project objectives make any one of them most important. Quality, cost, schedule, scope, risk and other factors may be prioritized differently on each project.

Question 97

Cindy has been working in a manufacturing project as a project manager. This project is intended to produce high-quality semiconductors to use in computers. Since semiconductors are produced from silicon wafers, she contracted a company to provide silicon wafers to the project on an ongoing basis. For unknown reasons, the contractor provided low-quality wafers to the project, compromising the electrical performance of the semiconductors. Overwhelmed by complaints from the computer division, Cindy is now obligated to correct the manufacturing defects to avoid future liabilities. In this scenario, the costs Cindy incurred are: Internal failure costs or Cost of conformance Appraisal costs or Cost of nonconformance External failure costs or Cost of nonconformance Prevention costs or Cost of conformance

Answer 97

External failure costs or Cost of nonconformance In this scenario, cindy is performing warranty work to correct manufacturing defects. These defects are identified by external customers, and the costs are known as external failure costs. These costs are also known as costs of nonconformance because the product did not meet the quality requirements. The cost of nonconformance is a part of the cost of quality. Therefore, cindy is incurring external failure costs or costs of nonconformance.

Question 98

For complex and high value projects, activities of business analysis get started well before the project is initiated. Typically in such cases, the requirements management process starts with: Collect Requirements Needs Assessment Define Scope Plan Scope Management

Answer 98

For complex and high value projects, activities of business analysis get started well before the project is initiated. Typically in such cases, the requirements management process starts with a business need analysis. The rest of the choices are the processes that are performed once the project has been initiated.

Question 99

An increase in quality can result in increased productivity. Increased cost effectiveness and: Decreased morale Decreased cost risk Lower customer satisfaction Increased risk

Answer 99

Decreased cost risk If quality is improved, the chance of rework decreases along with the associated costs.

Question 100

A project is in progress, and the project manager is working with the quality department to improve stakeholders' confidence that the project will satisfy the quality standards. Which of the following is an output of this process Recommended corrective action Quality problems Quality audits Quality metrics

Answer 100

Control quality process Quality audits: tool of Manage Quality process Quality problems: input of manage quality Quality metrics: input of manage quality

Question 101

All of the following are outputs of quality planning except: Quality management plan Metrics Validated deliverables Checklists

Answer 101

Validated deliverables are an output of perform quality control.

Question 102

The objective of a transformation project is to move an organization from one state to another state. The desired result of the change driven by the project is described as the: Good state Transition state Future state Happy state

Answer 102

Future state Before the project begins, the organization is commonly referred to as being in the current state. The desired result of the change derived by the project is described as the future state.

Question 103

The project management team performed activities such as measuring, examining, and verifying to determine whether work and deliverables met requirements and product acceptance criteria. Which of the following choices refers to a different set of activities than the ones just mentioned? Inspection Reviews Prevention Walkthroughs

Answer 103

The activities such as measuring, examining, and verifying to determine whether work and deliverables met requirements and product acceptance criteria are variously referred to as inspections, audits, reviews, product reviews, and walkthroughs. Prevention is not a valid term to describe these activities.

Question 104

Which of the following Manage Quality techniques examines problems, constraints, and non-value-added activities that occur during project work? Earned Value Analysis Expected monetary value analysis Sensitivity Analysis Process Analysis

Answer 104

Process analysis examines problems, constraints, and non-valueadded activities that occur during project work.

Question 105

What is a control chart? A chart that shows the stability of a process A type of fishbone diagram A type of RACI chart A chart that shows the root cause of a problem

Answer 105

A control chart shows the stability of a process over time.

Question 106

Which of the following are all tools of control quality Cost of quality, fishbone diagrams, checklists Histograms, check sheets, and Ishikawa diagrams Quality audits, inspection, approved change request reviews Control charts, process analysis, statistical sampling

Answer 106

7 Management tools for Quality Control: Flowchart, Check sheet, Cause and effect (fish bone) diagram, Pareto chart, Control charts, Histograms, Scatter Diagrams

Question 107

The method used in the Manage Quality process to identify the factors that may influence specific characteristics of a product under development is: The statistical sampling The forecasting technique Design for X The control chart

Answer 107

Design for X is a set of technical guidelines that may be applied during the design of a product for the optimization of a specific aspect of the design. DFX can control or even improve the product's final characteristics.

Question 108

The term ________ indicates the degree to which a particular product or service meets requirements, while _____________ indicates a category or rank used to distinguish that item from other similar items. Quality, grade Grade, standard Grade, quality Quality, standard

Answer 108

Quality, grade Grade is a category or rank used to distinguish items that have the same functional use; quality indicates the degree to which items have meet requirements.

Question 109

Ideally the relationship between a project manager and a business analyst should be: A collaborative partnership Business analyst should directly report to the project manager Project manager should directly report to the business analyst Business analyst must audit the project manager

Answer 109

A collaborative partnership Ideally the project managers and the business analysts should collaborate to achieve the project objectives.

Question 110

The technique of comparing actual or planned project practices to those of other projects to generate ideas for improvement and to provide a basis by which to measure performance is known as: Benchmarking Workbench Dependency Quality control

Answer 110

Benchmarking Benchmarking is the technique of comparing actual or planned project practices to those of other projects to generate ideas for improvement and to provide a basis by which to measure performance.

Question 111

The Quality Policy is the intended direction of a performing organization with regard to quality. However, as a project manager in a performing organization, you find the organization lacks a formal quality policy. What should you do in such a case? The project management team needs to obtain the quality policy from the customer. The project management team will need to develop a quality policy for the project. A quality policy is nice to have but is not required for every project. The project management team does not need to develop a quality policy since the performing organization does not have one.

Answer 111

The project management team will need to develop a quality policy for the project. The project management team will need to develop a quality policy for the project if the performing organization does not have a formal policy. It is also the responsibility of the project management team to ensure that the project stakeholders are fully aware of the policy.

Question 112

As a project manager, you are concerned with both prevention and inspection of errors in a work product. The difference between prevention and inspection is: Inspection is work the Quality Control (QC) team does; the Quality Assurance (QA) team does Prevention. Inspection refers to keeping errors out of the process; prevention refers to keeping errors out of the customer’s hands. Prevention refers to keeping errors out of the process; inspection refers to keeping errors out of the customer’s hands. Inspection and prevention refer to the same activity depending on what stage of the project the activity is done.

Answer 112

Prevention refers to keeping errors out of the process; inspection refers to keeping errors out of the customer’s hands. Prevention refers to keeping errors out of the process, while inspection refers to keeping errors out of the hands of the customer.

Question 113

A quality management plan ¡s created during: Project executing. Perform quality control. Perform quality assurance. Quality planning.

Answer 113

Quality planning. You need to know what happens in each part of the quality process. This one is easy quality planning. On the exam, you will also need to know what happens in perform quality assurance and perform quality control.

Question 114

All of the following are quality planning tools except: Benchmarking Cost-benefit analysis Cost of quality Scatter diagram

Answer 114

A scatter diagram is a quality control tool.

Question 115

A project team is having issues while attempting to determine the reason for a variance. One of the team suggests that creating a fishbone diagram might be helpful. The purpose of a fishbone diagram is to: Show functional responsibilities and how they are related to one another and to the objectives of the project Stimulate thinking, organize thoughts, and generate discussion Show how a process or system flows from beginning to end Determine the organization of the project

Answer 115

The fishbone diagram is a tool that we use to help stimulate thinking (brainstorming), to create an atmosphere conducive to open sharing of thoughts, and to gather our thoughts in a cohesive way. It can be used during planning to determine how to reach a quality objective or during analysis to determine the cause of defects.

Question 116

The principal use of a pareto diagram is to Focus attention on the most critical issues Quantify risks Help predict future problems Improve risk management

Answer 116

Focus attention on the most critical issues Fishbone diagrams are often used to stimulate thinking and to explore a desired future outcome. Determining whether a process is out of control is a function of control charts. Only focusing on critical issues to improve quality relates to Pareto charts. It can be used to look at past problems, not to predict future ones Source:PMP Exam prep Page: 249

Question 117

Which process group corresponds to the “do” part of the plan-do-check-act cycle? Monitoring and Controlling Executing Planning Closing

Answer 117

Executing The executing process group corresponds with the "do" portion of the pdca cycle.

Question 118

A project manager is working on a road construction project for the state. He has received much input regarding the effort from the state government, as well as from historical records of previous projects and from other resources. He is identifying the quality standards relevant to the project and determining how to meet them. This activity is a part of which quality process? Plan Quality Management Control Quality Manage Quality Quality Management

Answer 118

Plan Quality Management The key words here are "identifying the quality standards"

Question 119

Which of the following is not a part of the data gathering tools used in Control Quality process? Checklists Control Chart Statistical sampling Check sheets

Answer 119

Control chart is a monitoring tool, while the rest of the choices are valid data gathering tools used during control quality process.

Question 120

If the probability of one event occurring does not affect the probability of another event occurring, the event are: Just-in-time False events Mutually exclusive Statistically independent

Answer 120

Statistically independent Choice 'False events' is not correct because the events are true events. Choice 'Mutually exclusive' is not correct because, by definition, two events that are mutually exclusive cannot happen on the same trial. Choice 'Just-in-time' is incorrect because just in time refers to inventory levels. Choice 'Statistically independent' is correct because statistical independence deals with two events not being linked.

Question 121

Conformance to requirements and fitness for use are key concepts in quality management. Which of the following is another name for customer needs Voice of the Customer Scope creep Process mapping Prompt list

Answer 121

Voice of the Customer In quality management, customer needs and requirements are also known as voice of the customer (VOC).

Question 122

As an independent consultant, you are working with a project manager of a spacecraft parts manufacturing project to ensure that the team complies with organizational quality policies and procedures. Since parts made in this project must be of high precision and accuracy, you are documenting shortcomings within the processes and procedures to improve the quality for customer acceptance. Which of the following best represents the project management activity you are doing? Quality audits Quality control Inspection Statistical sampling

Answer 122

Quality audits Ensuring that the project team complies with organizational quality policies and procedures is done in the manage quality process. Quality audits are one such technique. A structured review is performed by independent consultants or contractors to identify all shortcomings in carrying out quality policies and procedures. These efforts should be used later to improve product quality and reduce the cost of quality.

Question 123

The testing results for the new computer modulation project have arrived from the seller. The results indicate the project is not meeting the overall quality requirements. If the project manager meets with team members to analyze the situation, the project manager is involved in: Control Quality Plan Quality Management Manage Quality Quality Management

Answer 123

The key word here is "overall".'Control quality' is wrong because we are not addressing the specific work perfromance.'Quality assurance' (Manage Quality) needs to be done to make sure standards and processes were followed.

Question 124

To address the root of problem, the pm decides to use an ishikawa diagram. Which of the following best describes the part of the quality management process in which the group is involved in this situation? Manage quality Control quality Quality analysis Plan quality management

Answer 124

Remember that Ishikawa is another name for a cause-and-effect diagram. The group is using this technique to analyze an actual defect. They must be in the Control Quality process.

Question 125

The Plan-Do-Check-Act (PDCA) cycle as the basis for quality improvement is usually attributed to: Juran Pareto Deming Crosby

Answer 125

Deming The plan-do-check-act (PDCA) cycle was defined by shewhart and later modified by deming.

Question 126

In order to keep costs low, a project management team decided to apply statistical sampling while inspecting some of the work products. They decided to select 10 out of 50 engineering drawings for inspection. During which process should the sample be collected? Collect Requirements Control Quality Plan Quality Management Manage Quality

Answer 126

Samples are collected for inspection during the control quality process.

Question 127

What percentage of the total distribution are 3 sigma from the mean equal to? 99. 73% 99. 99% 95. 46% 68. 26%

Answer 127

99.73%

Question 128

A project manager is leading an effort to analyze waste and non-value-added activity on the project. One team member reports that two processes in use require work he believes is unnecessary. Another team member reports that a process is not well understood. The project manager must be leading which of the following? The Plan Quality Mangement process The Manage Quality process A process rather than a project Management by objectives

Answer 128

If the project manager was planning (rather than doing) such activities, the answer would be the Plan Quality Management process. Perform Quality Assurance uses measurements gathered in the Control Quality process to assess whether the project is following processes and procedures, and identify needed improvements in the way the work is being done.

Question 129

Aii the following are used in quality management except? Marginal analysis Parametric estimating Delphi Technique Select sellers

Answer 129

Select sellers Seclect sellers is part of procurement management. Parametric estimating and the Delphi Technique can be used in quality management.

Question 130

During a discussion with the quality department, Dave, a project manager, was told that as applied to projects, the terms “prevention” and “inspection” are synonymous. However, his understanding of the terms is different. What would you comment on this situation? 1. The project manager is wrong. Both inspection and prevention are about keeping errors out of the process. They are used in different contexts. 2. The project manager is correct. Inspection is about keeping errors out of the process; prevention is about keeping errors out of the customer’s hands. 3. The project manager is correct. Prevention is about keeping errors out of the process; inspection is about keeping errors out of the customer’s hands. 4. The project manager is wrong. Both inspection and prevention are about keeping errors out of the customer’s hands. They are used in different contexts.

Answer 130

The project manager is correct. Prevention is about keeping errors out of the process; inspection is about keeping errors out of the customer’s hands. The project manager is correct. Prevention is about keeping errors out of the process, whereas inspection is about keeping errors out of the hands of the customer. This is an important distinction, which the project management team needs to be aware of.

Question 131

You are asked to select tools and techniques to supplement existing quality control activates. Which of the following would not be appropriate for this purpose Pareto diagram Performance reviews Statistical sampling Focus group

Question 132

A project manager is leading a project to streamline the manufacturing process of modular homes. The project manager researches and discovers a set of technical guidelines that will make the homes easier and cheaper to manufacture without compromising quality. The team incorporates these guidelines by designing a new modular home that reduces the total number of parts and uses more standard and multi-functional components. This is an example of: Design for X Data gathering Change request Problem solving

Answer 132

Design for X Design for X (DfX) is a set of technical guidelines that may be applied during the design of a product for the optimization of a specific aspect of the design. In this scenario, technical guidelines are being applied to design a new modular home that optimizes its manufacturability. DfX provides the most accurate and precise definition of the technique being used in this scenario and is, therefore, of the available choices, is the best answer to the question asked

Question 133

You are managing a project in a just-in-time environment. This will require more attention because the amount of inventory in such an environment is generally 12per 0per 45per 10per

Answer 133

With just in time, supplies are delivered when you need them and not before. Therefore, you have little or no inventory

Question 134

A project manager has to resolve two problems. Both problems can occur in a single trial. In this situation, what is the best action the project manager can take? Develop a solution for each problem Use a statistically independent trial Develop a solution that solves both problems No solution is needed, the two problems cancel each other out

Answer 134

Develop a solution for each problem The question indicates the two problems are unrelated. Therefore, they require separate solutions.

Question 135

To what does the following definition refer? "the point where the benefits or revenue to be received from improving quality equals the incremental cost to achieve that quality:' Conformance analysis Quality control analysis Marginal analysis Standard quality analysis

Answer 135

Marginal analysis This is the definition of marginal analysis. Know the term so you will be able to answer questions that deal with this concept. The other choices may sound good, but they are made-up terms.

Question 136

An automotive designer uses a certain technique to determine which combination of suspension and tires will produce the most desirable ride characteristics at a reasonable cost. To do this, the designer employs a statistical framework and systematically changes all the important parameters instead of changing the factors one at a time. This method is known as: Force Field Analysis Design of Experiments Nominal Group Technique Statistical Sampling

Answer 136

The correct response is design of experiments; this method plays a key role in optimization of products or processes.

Question 137

A project manager has to resolve two problems. Both problems can occur in a single trial. In this situation, what is the best action the project manager can take? Develop a solution that solves both problem. No solution is needed; the two problems cancel each other out. Develop a solution tfor each problem. Use a statistically independent trial.

Answer 137

The question indicates the two problems are unrelated. Therefore, they require separate solutions.

Question 138

Julia is managing a water treatment plant construction project. A new government has recently been sworn in. During the election campaign, the winning candidate made a number of commitments regarding environmental control reforms. Julia is not sure how the new government and its future policies might affect her project. This is an example of: Mitigated risk Variability risk Ambiguity risk Opportunity risk

Answer 138

Ambiguity risk Ambiguity risks relate to areas of the project where imperfect knowledge might affect the project’s ability to achieve its objectives. Examples include: elements of the requirement or technical solution, future developments in regulatory frameworks, or inherent systemic complexity in the project.

Question 139

The project has had a major defect, and the project manager has involved the project team and process engineers in analyzing the situation. One of the group says that the real fault ¡s the age of the equipment. Another says it is the lack of material of the correct quality. To address the root of the problem. The project manager decides to use an ishikawa diagram. Which of the following best describes the part of the quality management process in which the group is involved in this Perform quality assurance Quality analysis Perform quality control Quality planning

Answer 139

Perform quality control The group is analyzing an actual defect. They must be in perform quality control.

Question 140

Which of the following best describes a control chart Showing potential causes of issues Showing loops between activates Showing project activates and their schedule Showing the upper and lower control limits

Answer 140

Showing the upper and lower control limits

Question 141

All of the following are inputs to quality planning except? Project work results Project scope statement Enterprise environmental factors Project management plan

Answer 141

Project work results | Work results would occur during quality mangement, not before quality planning.

Question 142

Project managers need to be aware of Student Syndrome, also known as procrastination, which means that people start to apply themselves only at the last possible moment before the deadline. This concept is similar to Parkinson’s Law which states that: Work only gets completed during the second half of the allocated time. Work expands to fill the time available for its completion. Work never gets completed on time even if sufficient time has been allocated. Effort expands to fill the time available for the completion of a work package.

Answer 142

According to the parkinson’s law, work expands to fill the time available for its completion.

Question 143

A data point on a control chart that requires investigation is called A specification limit A rule of seven A special cause Gold plated

Answer 143

A special cause A data point that requires you to determine the cause of the problem calls for a special cause. Gold plating is providing the customer more that what they asked for. A rule of seven is not just a single data point and thus not correct, even though it also requires an assignable special cause. A specification limit is the customer-defined requirements for quality

Question 144

Seven nonrandom data points that are still within the upper or lower control limit of a control chart are: Out of control Gold plated Specification limits In control

Answer 144

A process is considered out of control when a data point exceeds a control limit or if seven consecutive points are above or below the mean

Question 145

The project you are working on has an increase in cost effectiveness, increased productivity and increased morale. What might be the reason for these changes? Project objectives are in line with those of the performing organization Increased quality Rewards presented for individual efforts Management’s focus on cost containment

Answer 145

Increased quality As you increase quality, there will be associated benefits for the project. Some of these benefits are increased productivity, increased cost effectiveness, decreased cost risk and improved morale.

Question 146

All of the following are parts of perform quality control except? Flowcharting Control charts Inspection Cost of quality

Answer 146

Cost of quality Tools and techniques for perform quality control include flowcharting, statistical sampling, Pareto charts, control charts and inspection.

Question 147

Which of the following processes will determine the correctness of deliverables? Plan Deliverables Manage Quality Plan Quality Management Control Quality

Answer 147

Control Quality An important goal of quality control is to determine the correctness of deliverables. The results of the execution of quality control processes are verified deliverables. These are then input to the validate scope process for formalized acceptance.

Question 148

You are a project manager for an automotive parts company. Your organization was hired to produce clutches for an exotic car company. This will involve the design and production of custom clutches. During the course of the project, as you review a quality control statistics chart that examines every clutch produced for the month, you notice several cases where the spring component of the clutch is expanding with too much force and is falling outside the upper control limit. Which type of Quality Control tool are you most likely using? Statistical Sampling Precedence Diagramming Method Control charts Cause-and-Effect diagram

Answer 148

Control charts Control charts graphically display the interaction of process variables on a process. Control charts have three lines: a center line which gives the average of the process, an upper line designating the upper control limit (ucl) and showing the upper range of acceptable values, and a lower line designating the lower control limit (lcl) and showing the lower range of acceptable values. Points that fall outside of this range are evidence that the process may be out of control.

Question 149

Nonrandom data points that are still within the upper and lower control limit of a control chart are: Out of control. In control. Specification limits. Gold plated.

Answer 149

The key to this question is "non-random". It is refering to the rule of seven.

Question 150

While performing quality planning for the design and manufacture of a new medical device, the team has identified the need to keep variances to a minimum because the end product must be of the highest quality possible. They are researching the practices of comparable projects for ideas on how to achieve this requireent. The team is using which of the following techniques? Pareto analysis Cost-benefit analysis Benchmarking Design for X

Answer 150

Benchmarking

Question 151

The project contains many activity. One of the large activity has an estimate to complete (ETC) that is longer than planned. If the pm wants to look at non-value-added activities that might cause the delay, then manager should: Measure using quality metric Complete process analysis Perform a quality audit Use a pareto diagram

Answer 151

Discovery non-value activity is a process analysis; implementing the process improvement plan. Many people choose quality audits (Choice Perform a Quality audit). However, quality audit relates to determining whether we are using the right processes and whether those processes are effective, not improving processes.

Question 152

A project is facing a major change to its project deliverables. If the project manager is involved in determining which quality standards are relevant to the change. The project manager must be involved in: Perform quality control. Perform quality assurance. Quality planning. Quality management.

Answer 152

Quality planning. Although quality planning usually occurs during project planning, it can occur during prroject execution when there is a change.

Question 153

An ishikawa diagram helps to: Organize thoughts and generate discussion Show functional responsibilities Put information in its order of priority Show team responsibilities

Answer 153

Advantages of Ishikawa diagram: - Highly visual brainstorming tool which can spark further examples of root causes - Quickly identify if the root cause is found mutliple times in the same or different causal tree - Allows one to see all causes simultaneously - Good visualization for presenting issues to stakeholders

Question 154

If a process has a lack of consistency and predictability it is said to be Out of control. Assigned a cause. Quality assured. N control.

Answer 154

Out of control. Inconsistency and nonpredictability are indications that the process is out of control.

Question 155

If a process has a lack of consistency and predictability it is said to be Out of control. Assigned a cause. Quality assured. N control.

Answer 155

Out of control. Inconsistency and nonpredictability are indications that the process is out of control.

Question 156

120 of 18001:54:22 During project executing., a project team member informs the project manager that based on her observations. The project cannot meet the quality standards set for it. What would be the least effective thing for the project manager to do? Review the quality plan Hold a meeting on the issue Review the project scope statement Continue the Manage Quality process

Answer 156

Continue the Manage Quality process Perform quality assurance (Manage quality) involves determining whether standards are being followed. This would be the least effective, since it does not address the specific problem described in the question.

Question 157

Standard deviation is a measure of how Far the measurement is from the mean. Correct the sample is. Far the estimate is from the highest estimate. Much time remains in the project.

Answer 157

Far the measurement is from the mean. Standard deviation is the measurement of a range around the mean. Therefore, choice "Far the measurement is from the mean." must be the best answer.

Question 158

Which of the following cannot be used as a quality control tool? Pareto chart Life cycle costing Sampling Work breakdown structure

Answer 158

Life cycle costing You can use the WBS in many ways to control quality. The other choices are official quality control tools except for life cycle costing which has nothing to do with quality.

Question 159

From the project perspective, quality attributes Determine how effectively the performing organization supports the project Are objective criteria that must be met Provide the basis for judging the project's success or failure Are specific characteristics for which a product is designed and tested

Answer 159

Are specific characteristics for which a product is designed and tested Quality attributes are the measurements that determine if the product is acceptable. They are based on the characteristics of the product for which they were designed

Question 160

On any project, the configuration control should be focused on the specification of: Scope and cost Risk and resources Schedule and quality Deliverables and processes

Answer 160

The focus of configuration control is on specification of both the deliverables and the processes. The rest of the choices are incorrect.

Question 161

The new software installation project is in progress. The project manager is working with the quality department to improve everyone's confidence that the project will satisfy the quality standards. Which of the following must they have before they start this process? Rework Quality problems Quality improvement Quality control measurement

Answer 161

Quality control measurement This question is similar to others in this program, but not exactly the same. You may also see this occur on your exam. Carefully read the questions! Though quality problems (choice “Quality problems”) MAY lead to quality assurance efforts, they are not a MUST. Quality improvement (choice “Quality improvement) is a result of perform quality assurance. not an input. Rework is an output of perform quality control. That leaves only quality control measurement (Choice “Quality control measurement”) which are inputs to perform quality assurance.

Question 162

Testing the entire population would Show many defects Be mutually exclusive Provide more information than wanted Take too long

Answer 162

Take too long The length of time it takes to test a whole population is one of the reasons to take a sample

Question 163

Who of the following has primary responsibility for establishing design and test specifications? Senior management Engineering Procurement Quality control

Answer 163

Developing specifications should come from a technical expert. The only choice listed that meets that description is engineering. Not every question on the exam will require that a project manager do the work.

Question 164

Which of the following is correct about quality improvements? They are a product of cooperation between the customer and the project manager. They occur only through experience of the project manager, team and sponsor. They are a tool of perform quality assurance and an output of scope verification. They require the preparation of change requests or the recommendation of corrective actions.

Answer 164

They require the preparation of change requests or the recommendation of corrective actions. Quality improvements are not a tool of perform quality assurance. so choice “They are a tool of perform quality assurance and an output of scope verification.“ cannot be best. They are identified through measurement and analysis in additional to experience (choice “They occur only through experience of the project manager, team and sponsor.“). Quality improvements can come from more than the customer and the project manager (Choice They are a product of cooperation between the customer and the project manager.)

Question 165

Which of the following would generally lead to the least amount of quality improvement? Quality planning Total Quality Management (TQM) Increasing inspection Implementing an ISO 9000 standard

Answer 165

Quality cannot be inspected in: you must plan for and execute a quality strategy. Increasing inspection is the only answer that is not proactive.

Question 166

Which of these statements is true? The cost of correcting mistakes through an inspection is much less than the cost of preventing them. It does not matter where a defect is captured as long as the finished work product does not have a defect. The cost of preventing mistakes is generally much less than the cost of correcting them as revealed by inspection. The cost of correcting mistakes through an inspection is more or less the same as the cost of preventing them since the same effort goes into both activities.

Answer 166

The cost of preventing mistakes is generally much less than the cost of correcting them as revealed by inspection. This is one of the basic tenets of project and quality management. The cost of preventing mistakes is generally much less than the cost of correcting them as revealed by inspection.

Question 167

A control chart indicates the last 12 weights produced were outside the upper control limit. What should the project manager do? Work to better meet ISO 9000 standards. Plan to rework the 12 weights. Stop production. Look for the non-random causes for the variations.

Answer 167

Data points outside the control limits indicate the process is out of control, and production should be stopped until a solution is found.

Question 168

As the project manager, you are preparing your quality management plan. You are looking for a tool that can demonstrate the relationship between events and their resulting effects. You want to use this tool to depict the events that cause a negative effect on quality. Which of the following is the best choice for accomplishing your objective? Why-why diagram Control chart Scatter diagram Pareto diagram

Answer 168

All reports and diagrams are communications tools. This question asks you to pick the most appropriate quality tool to help communications. An Ishikawa diagram, also called a cause and effect diagram, is more appropriate than a Pareto chart since you are trying to determine the causes. Once causes are known and you have data on occurrences, the data can be displayed in a Pareto chart.

Question 169

During a team meeting, the team adds a specific area of extra work to the project because they have determined it would benefit the customer. What is wrong in this situation? The team is not following the project management plan Nothing. The project manager is in control of the situation These efforts shouldn't be done in meetings Nothing. This is how to meet and exceed customer expectations

Answer 169

The team is not following the project management plan This is an example of gold plating. You should provide ONLY what the customer asked for. The team does not know if their change will provide benefit to the customer. Focus efforts on fulfilling the requirements.

Question 170

All of the following are not examples of quality assurance except? Pareto chart Fishbone diagram Inspection Process analysis

Answer 170

Process analysis Inspection is done as part of quality control. Pareto chart and Fishbone diagram are done as part of quality planning or control (depending on how they are used). This leaves only choice "Process analysis", which must be the best answer, as process analysis is part of quality assurance. Watch out for "double-negative" questions like this on the exam!

Question 171

A project manager needs to assess quality on the project. To do so, he wants to measure the height of each table produced. However, that would be too expensive. In this case, it would be best to use: A sample A control chart An affinity diagram Benchmarking

Answer 171

A sample refers to measuring a small part of a larger group to determine the quality level of the entire group

Question 172

Matrix diagrams, affinity diagrams, and flowcharts are all examples of? Tools used in quality management Tools used in team performance assessment Parts of a project management plan Tools used to define scope

Answer 172

Tools used in quality management

Question 173

What is a likely result of not following the approved processes to do the work? A new standard Fulfilled requirements Rework A reduction in time and cost

Answer 173

Rework Not following processes does not result in the creation of new ones. Not following processes is likely to cost the project additional time and money, and will not fulfill the requirements. The likely result of not following approved processes on a project is rework, which leads to wasted time and money.

Question 174

Warranty and inventory costs are going up. Causing the project manager to worry about the costs of nonconformance. What is the best advice you can give the project manager? Look for benchmarks. Perform a quality audit Increase rework. Increase scrap.

Answer 174

Perform a quality audit Choice "Increase scrap" and "Increase rework" would only make the problem worse. Choice "Look for benchmarks" would help you see how much of a problem you have, but would not solve the problem. Only a quality audit leads to solving the problem.

Question 175

Five of the seven phases on the project contain work that is substantically similar. What must the project manager do? Plan in continuous improvement activities See what can be done to make sure the work is carefully reworded to remove the similarity Make sure the same resource completes all the similar work packages Make sure the first and last of these work packages is scheduled close in time to each other

Answer 175

Plan in continuous improvement activities To answer this question, you must first realize that this is not necessarily a bad situation. Many projects have repeated work. Therefore, choice ‘See what can be done to make sure the work is carefully reworded to remove the similarity’ is eliminated. There could be some benefit to having the same resource do all the work packages, however, this may not be practical. The question asks for what MUST the project manager do, and they do not need to do choice ‘Make sure the same resource completes all the similar work packages’. There is no benefit to scheduling the work packages close to each other so ‘Make sure the first and last of these work packages is scheduled close in time to each other’ cannot be correct. Choice ‘Plan in continuous improvement activities’ provides the knowledge gained from the earlier work packages to be used by the later work packages, making the later ones faster and easier. Therefore ‘Plan in continuous improvement activities’ is the best answer.

Question 176

Measuring the quality of items in a sample on a pass/fail basis is: Biased sampling Attribute sampling Stratified sampling Variable sampling

Answer 176

Attribute sampling Attribute sampling measures the quality of items in a sample on a pass/fail basis; variable sampling measures the quality on a continuous scale.

Question 177

As a project manager, you are responsible for determining and delivering the required levels of both grade and quality. Select which of the following statements you disagree with. Grade relates to the customer requirements. Quality relates to the customer requirements. Quality and grade of a product must be carefully managed. Grade relates to the product's characteristics.

Answer 177

The grade of a product relates to the technical characteristics of the product.

Question 178

A project manager is using a cause and effect diagram with the team to determine how various factors might be linked to potential problems. In what part of the quality management process is the project manager involved? Perform quality assurance Quality planning Perform quality control Quality analysis

Answer 178

The key words here are "potential problems". They are looking into the future and, therefore must be in quality planning.

Question 179

As a project manager, you are analyzing the costs incurred in a project. Which of the following costs cannot be classified under cost of nonconformance? Costs due to loss of reputation Rework costs Quality Assurance Costs Warranty costs

Answer 179

Quality Assurance Costs The quality assurance costs are part of the cost of conformance. The cost of non-conformance includes the failure costs.

Question 180

A control chart should always contain: The moving average Upper and lower control limits Upper and lower specification limits Upper and lower warning limits

Answer 180

Upper and lower control limits Upper and lower control limits allow the control chart to serve its purpose of indicating when a process is in or out of control.

Question 181

Management wants to be sure that the project is following defined quality standards. Which of the following should they look at? Statement of work Risk management plan Quality audit WBS

Answer 181

Quality audit A report of quality management activities will prrovide confidence that the project will satisfy relevant quality standards.

Question 182

Scope verification is different than quality assurance is that: Scope verification is provided to the project management team while quality assurance is provided to the project. Quality assurance is considered part of quality planning while scope verification is not. Quality assurance focuses on the quality on the project. while scope verification focuses on customer acceptance. Scope verification is performed throughout the project and quality assurance is only done during planning.

Answer 182

Scope verification is performed during project monitoring and controlling. Making choice “scope verification is performed throughout the project and quality assurance is only done during planning“ incorrect. Choice “quality assurance is considered part of quality planning while scope verification is not” is also an untrue statement. Scope verification is provided to the customer, not the team, making choice “scope verification is provided to the project management team while quality assurance is provided to the project” incorrect.

Question 183

The project team has created a plan for how they will implement the quality policy. It addresses the organizational structure, responsibilities. Procedures and other information about plans for quality. If this changes during the project. Which of the following plans will also change? Quality management Quality assurance Quality control Project management

Answer 183

The plan described is the quality management plan. Since the quality management plan is included in the project management plan, changing the quality management plan will also change the project mangement plan.

Question 184

Quality metrics used during the Control Quality process are defined during which process? Manage Quality Plan Quality Management Define Scope Collect Requirements

Answer 184

Quality metrics are operational definitions that describe a project or product attribute in very specific terms. They also define how the quality control process will measure it. These metrics are outputs of the plan quality management process.

Question 185

Measuring the height of one of the tables manufactured by your company to determine if it meets your quality standards is an example of measuring: A mutual exclusivity A sample. A population Statistical independence

Answer 185

A sample. Here, one table is tested for quality; it is, therefore, a sample of a larger set

Question 186

By policy, the project management office regularly evaluates project performance. This is done in order to ensure standards are being followed. This is an example of: Control Quality Manage Quality Perform Quality Management Plan Quality Management

Answer 186

Any instance where there is an evaluation of the quality standards is part of Manage Quality.

Question 187

Andy is currently working for ABC Contractors as a quality control manager for a railway track construction project. National Railways awarded this cost-plus construction contract to ABC Contractors a few months ago. As a contractual requirement, ABC Contractors has to submit each completed deliverable for client acceptance. Reviewing project data, Andy found that the current submission rejection rate is 22 percent. He conducts a root cause analysis and submits his findings along with construction process improvement recommendations to the project director. In this scenario, Andy’s report is an example of: Raw observations Work performance data Work control report Work performance information

Answer 187

The data on rejections is the project performance data. Andy analyzed it and converted it into work performance information, i.e. Reasons for rejections and recommendations.

Question 188

As project manager, you would like to show the relationship between two variables to help your project team understand the quality impact better. Which tool should you use? Fishbone Diagram Scatter Diagram Run Chart Pareto Chart

Answer 188

Scatter Diagram A scatter diagram plots several occurrences of two variables (one on each axis). Often a relationship between the two variables can then be determined, based on how closely they fit a geometric model.

Question 189

At a critical milestone in a development project, it is determined that implementation is two months behind schedule. The project manager is concerned the root cause is lack of conformance to requirements in the design of the new billing system. More extensive measurements are taken to see if this is, in fact, the problem. Such measurements are: Not going to show why the schedule is delayed An example of Control Quality Not needed; the schedule should be compressed Part of the Perform Intergrated Change Control process

Answer 189

An example of Control Quality Remember that control relates to measurement. The measurements are an activity of Control Quality.

Question 190

A control chart is used to determine whether a process is stable or has predictable performance. When a process is within acceptable limits, the process does not need adjustment. How are these upper and lower control limits determined? Pareto chart Statistical calculations ROM estimate Variance analysis

Answer 190

Statistical calculations The upper / lower control limits are statistically calculated (normally set at + / - 3 sigma).

Question 191

At the end of a project, a project manager determines that the project has added four areas of functionality and three areas of performance. The customer has expressed satisfaction with the project. What does this mean in terms of success of the project? The project was an unqualified success. The project was unsuccessful because ¡it was gold plated. The project was unsuccessful because the customer being happy means they would have paid more for the work. The project was successful because the team had a chance to learn new areas of functionality and the customer was satisfied.

Answer 191

Gold plating a project wastes time and probably cost. It makes the project unsuccessful.

Question 192

Which statement is true of quality planning‘? Quality planning is done to compile a risk response plan. Quality planning should be performed regularly throughout the project. Quality planning is not considered during project executing. Quality planning is done only during development of the project management plan.

Answer 192

Quality planning should be performed regularly throughout the project. Quality management should be performed regularly and in parallel with other planning processes throughout the project

Question 193

The acceptable range of variation of a process on a chart that shows how the process behaves over time is the Rule of seven Specification limit Upper and lower control limit Mean

Answer 193

The acceptable range of variation of a process on a chart that shows how the process behaves over time is the upper and lower control limit.

Question 194

A project manager is in the process of creating the quality management plan for a product development project. Currently, the project manager needs to understand and then estimate the cost of quality for a particular process. What is the best course of action? Develop a RACI chart Construct a RAM Build a SIPOC model Create a fishbone diagram

Answer 194

The quality management plan is created as an output of the Plan Quality Management process. Tools and techniques that may be used in the development of the quality management plan include flowcharts. A SIPOC (suppliers, inputs, process, outputs, and customers) model is a type of flowchart that may prove useful in understanding and estimating the cost of quality for a process. The incorrect answer choices represent tools and techniques that may be used in various project management processes but are not likely to be useful in the development of the quality management plan. Therefore, of the available choices, the best course of action for the project manager is to build a SIPOC model.

Question 195

The testing results for a new computer modulation project indicate a problem with the on-board computer's sensors. The project manager calls a meeting with the team to analyze the problem. The project manager is involved in: Quality planning. Quality control. Quality assurance. Quality management.

Answer 195

Quality control. This question describes a defect that has already occurred, therefore it is part of quality control.

Question 196

__________refers to nonrandom data points that are grouped together on one side of the mean of a control chart 6sigma Rule of seven Specification limits Lower control limit

Answer 196

The definition of the rule of seven says that there are seven or more sequential data points that fall on the same side of the mean. This indicates that the process is out of control.

Question 197

Which statement best reflects the phrase, "quality is planned in, not inspected in"? It is more expensive to determine quality by inspection than by planning. Quality activities occur during project planning Planning for quality is after the fact Quality is part of planning, not inspection

Answer 197

It is more expensive to determine quality by inspection than by planning. Quality is addressed during all parts of the project, not just during planning (choices'quality is part of planning, not inspection' and 'Quality activities occur during project planning' ) Planning for quality (choice 'It is more expensive to determine quality by inspection than by planning.') is before the fact, not after the fact

Question 198

The customer had issued an rfp six months ago, and your proposal was selected based on the number of years your company has been in business as well as your company's project management capabilities. The rfp included requirements, and your proposal outlined the work to be done by your company to meet the requirements. You and team determined that the product is cutting edge and therefore new standards and processes for the development of the product were created. In order to ensure these standards and processes are effective, which technique should you plan to use? Process improvement Change requests Process analysis Quality audit

Answer 198

Change requests and process improvement are not techniques, although both are likely results of quality management efforts. Process analysis focuses on identifying improvements that might be needed in processes. In order to ensure that standards and processes are effective and are being followed appropriately, quality audits should be planned in at certain points in the project.

Question 199

Which of the following best describes why quality is planned in and not inspected in? It improves quality and is more expensive It reduces quality and is less expensive. It improves quality and is less expensive It reduces quality and is more expensive

Answer 199

It improves quality and is less expensive Look for the proactive approach. When we plan for quality, it improves quality, which is less expensive over the long run. Notes: You may spend more initially for increased quality, but you will save through reduced rework, etc.

Question 200

A manager notices that a project manager is holding a meeting with some of the team and some stakeholders to discuss the quality of the project. The project schedule has been compressed and the cpi is 1.1. They have worked hard on the project, the team has been rewarded according to the reward system the project manager put in place and there is a strong sense of team. The manager suggests that the project manager does not have enough time to hold meetings about quality when the schedule is so compressed. Which of the following best describes why the manager is wrong? Improved quality leads to increased productivity, increased cost effectiveness and increased cost risk. Improved quality leads to increased productivity, increased cost effectiveness and decreased cost risk. Improved quality leads to increased productivity, decreased cost effectiveness and decreased cost risk. Improved quality leads to increased productivity, decreased cost effectiveness and increased cost risk.

Answer 200

Improved quality leads to increased productivity, increased cost effectiveness and decreased cost risk. Notice in this question that there is a lot of data not relevant to answering the question? Expect these distracters to occur in almost every question on the exam. Quality should produce a decrease rather than an increase in cost risk as a result of less rework. So choices “Improved quality leads to increased productivity, decreased cost effectiveness and increased cost risk.” and “Improved quality leads to increased productivity, increased cost effectiveness and increased cost risk.” can be eliminated. Quality should also provide increased cost effectiveness due to less rework. This eliminates Choice “Improved quality leads to increased productivity, decreased cost effectiveness and decreased cost risk.” leaving the best answer, choice “Improved quality leads to increased productivity, increased cost effectiveness and decreased cost risk.”.

Question 201

A project is considered out of control and the previous project manager has quit. You are assigned as the new project manager and have been asked to verify the quality level of the project and to recommend corrective action. What do you do first? Create a risk mitigation plan. Review the project management plan. Draw a control chart. Meet with the team.

Answer 201

The question could he read as "What do you do first to deal with this situation?" You might do choices “Review the project management plan”, “Meet with the team” or “Draw a control chart” when first assigned as project manager, but only creating a control chart (choice Draw a control chart) deals with the problem presented.

Question 202

You are a project manager for Enormous Co. and are currently engaged in a highly visible project. The company is about to implement an independent review to ensure that the project work is continuing to comply with the project‘s policies, processes, and procedures. During which process would this review occur? Monitor Risks Control Quality Manage Quality Close Project or Phase

Answer 202

Quality audits are performed during the manage quality process.

Question 203

Which of the following is an example of a tool used in quality planning? Fishbone diagrams used to evaluate a defect Control charts Quality audits Benchmarking

Answer 203

Benchmarking In quality planning, you are defining quality for the project and determining how quality will be mezmured. Benchmarking looks at pzust projects for improvement ideas and sets guidelines from which to measure quality performance.

Question 204

You are a project manager working on a project to create high-efficiency electric motors for a company introducing a new electric golf cart. Your company’s president is keenly interested in the project and requests a chart that shows the number of defects by type ordered by their frequency of occurrence. Which type of chart would BEST meet this request? Scatter diagram Statistical sampling Histogram Control chart

Answer 204

Histograms show a graphical representation of numerical data. A histogram can be used to display how many defects were produced by type or category of cause and ordered by their frequency.

Question 205

Identifying ways to eliminate the causes of unsatisfactory performance would most likely lead to Recommended corrective actions Work performance information Quality audits Updates to the performance measurement baseline

Answer 205

Recommended corrective actions Quality audits and work performance information would lead up to the performance issues being identified. Changing the quality baseline (Choice " Updates to the performance measurement baseline") is a very serious action that should be taken only after lots of discussion and approvals. It is more likely that recommended corrective actions would be the result.

Question 206

A project manager takes over an existing project, only to find that there are no quality standards. What part of the quality process should the project manager be in Quality analysis Manage quality Control quality Plan quality management

Answer 206

Determining what standards to use is part of the Plan Quality Management process. Don't get fooled because this situation is occurring during project executing.

Question 207

If the team is creating more efficient processes and eliminating waste on the project, they are involved in Continuous improvement Controlling quality Enhancing scope Gold plating

Question 208

Project manager is determining the factors that might influence specific quality variables. He has chosen to analyze the color/size combination that will contribute most to the functionality of the new product. In what part of the quality management process is the project manager involved? Control quality Plan quality management Manage quality Quality analysis

Answer 208

Plan quality management Notice the question says "will" contribute? The situation is looking forward. The project manager is involved in the design of experiments, which is included in quality planning

Question 209

Quality on your project must be as high as possible. Yet this type of project is new for your company. Which of the following is the best thing to do? Audit work as it is being completed to look for any improvements. Use cause and effect diagrams when there ¡is a defect. Make sure your staffing management plan is up to date. Improve your work authorization system.

Answer 209

Audit work as it is being completed to look for any improvements. Choice “Improve your work authorization system.” might help make sure things get done on time and that people know what work they need to do and when, but it is not related to quality. Choice “Use cause and effect diagrams when there ¡is a defect.” is looking backward. It is reactive. so it is not the best choice. Choice “Make sure your staffing management plan is up to date.” deals with when people will be moved on and off the project. It does not deal with quality. Choice “Audit work as it is being completed to look for any improvements.” is a better answer because it directly deals with quality.

Question 210

A project was randomly selected for a quality audit, and the external auditor found various issues and nonconformance. The project manager lodged a complaint with the quality department that this was improper procedure, and he should have received notice since an external auditor was involved. What is your view? The project manager has no case. Quality audits are always carried out by external auditors. The project manager has no case. Quality audits may be random and performed by internal or external auditors. The project manager is correct. Quality audits need to be scheduled when an external auditor is involved so that the project manager has time to prepare for them. The project manager is correct. The project team must perform all quality audits.

Answer 210

The project manager has no case. Quality audits may be random and performed by internal or external auditors. The project manager has no case. Quality audits may be scheduled or random and may be conducted by internal or external auditors. It is the responsibility of the project manager and the project management to ensure that the project documentation is kept up to date and available for any quality audit.

Question 211

Caitlin’s project is behind schedule. She is planning to crash the project by allowing overtime to the project team. This approach can bring additional risks to the project. Which of the following is not a valid risk in this scenario: The project’s acceptance criteria might get updated. The profit margin might decrease. Risk of employee attrition might increase. Risk of errors and/or rework might increase.

Answer 211

The project’s acceptance criteria might get updated. Meeting customer requirements by overworking the project team may result in decreased profits, increased levels of overall project risks, employee attrition, errors, or rework. The project’s acceptance criteria should not get updated as a result of crashing.

Question 212

A project manager has just taken over the project from another project manager during project executing. The previous project manager created a project budget, determined communications requirements, and went on to the complete work packages task. What should the new project manager do next? Coordinate completion of work packages Begin the Identify Risks process Identify quality standards Validate Scope

Answer 212

Identify quality standards

Question 213

Sheila is the project manager of a website development project. After a detailed discussion with the project management team, she decides to create an informal, broadly framed quality management plan. What would your comment on this be? This is incorrect. A quality management plan should be formal but broadly framed. This is fine. The project requirements determine the style and detail of the quality management plan. This is incorrect. A quality management plan should be formal and highly detailed. This is incorrect. A quality management plan should be informal and highly detailed.

Answer 213

The quality management plan may be formal or informal, highly detailed or broadly framed. Its style and detail are determined by the requirements of the project as defined by the project management team.

Question 214

A project is in progress, and the project manager is working with the quality department to improve stakeholders' confidence that the project will satisfy the quality standards. Which of the following are all outputs of this process? Quality metrics, quality reports, change requests Change requests, project management plan updates, completed checklists Recommended preventive actions, benchmarking, verified deliverables Change requests, recommended corrective actions, test and evaluation documents

Answer 214

This question is similar to others in this exam simulator, but not exactly the same. You may also see this occur on your exam. Carefully read the questions! In this case, we are in the Manage Quality process. Completed checklists and verified deliverables are outputs of Control Quality. Quality metrics are an output of Plan Quality. Benchmarking is a tool of the Plan Quality process. Change requests, recommended corrective actions, and test and evaluation documents are all outputs of the Manage Quality process.

Question 215

The objective of a transformation project is to move an organization from one state to another state. Before the project begins, the organization is commonly referred to as being in the: Historic State Ready State Hot State Current State

Answer 215

Before the project begins, the organization is commonly referred to as being in the current state. The desired result of the change derived by the project is described as the future state.

Question 216

A new software development project is in progress, and the project manager is working with the quality department. They want to improve everyone's confidence that the project will satisfy the quality standards. Which of the following must they have before they start this process? Rework Results of quality control measurements Completed checklists A quality control plan

Answer 216

The only choice listed that makes sense and is an official input to Manage Quality is results of quality control measurements. This question is similar to others in this exam simulator but not exactly the same. You may also see this occur on your exam. Carefully read the questions!

Question 217

A trend report was given to the project manager, who reacted to the report by investigating what activity or activities had not been done, but should have been done, to date. What did the report show Select one Mark question The schedule performance index (SPI) was 1.3 and the estimate at completion (EAC) was greater than planned. Actual cost was below planned and schedule progress was less than planned The budget at completion (BAC) was higher than planned The cost performance index (CPI) was 0.8 and the schedule performance index (SPI) was 1.2

Answer 217

You should ask yourself which of the choices would be interepted to mean that work was not done. A schedule performance index (SPI) of less than 1 could mean that work was not done, but there could be other reasons. When you combine cost and schedule you can clearly see that the reason the project has prrogressed more slowly than planned is probably due to work not getting done.

Question 218

Identified risks are: Select one Mark question Not related to the Estimate Costs process. Both an input to and an output of the Estimate Costs process. An input to the Estimate Costs process. An output of the Estimate Costs process.

Answer 218

Identified risks are both an input to and an output of the Estimate Costs process.

Question 219

``` Martin is the project manager of a project that is in an early phase. He needs to estimate costs but finds that he has a limited amount of detailed information about the project. Which of the following estimation techniques is least suited to his requirements? Select one Mark question Budgetary Estimating Top-down Estimating Bottom-up Estimating Analogous Estimating ```

Answer 219

Bottom-up estimating is a technique that can be applied only when there is a sufficient amount of detail available to the project manager.

Question 220

``` The organization that you work for supports the achievement of its strategic objectives by empowering project managers and teams. The project managers have the authority to structure their teams, plans, and work however they deem necessary to best ahieve results. They are responsible for controlling the schedule and the budget, and for providing the steering committee and other departments of the organizations with forecasts. Which part of the cost budget would these project managers not have control over? Select one Mark question Cost baseline Contingency reserves Management reserves Control account estimates ```

Answer 220

Project Budget = Cost Baseline + Management Reserve Project Budget = Cost Baseline + Management Reserve

Question 221

``` `project setup costs are an expampel of: Select one Mark question Variable costs Fixed costs Opportuinty costs Overhead costs ```

Answer 221

Setup costs do not change as production on the project changes. Therefore, they are fixed costs

Question 222

The plan cost management process addresses all the following except Select one Mark question Specifications for how estimates will be stated Corrective actions needed to bring the project back on track How project risks will be identified Whether to use existing funds or borrow money to finance the project

Question 223

``` Rick, a project manager, is updating the status of his project. Based on the performance indices, he expects the project to finish a month earlier than the planned finish date. However, he expects the project to exceed the budgeted costs. What can you say about the schedule performance index (SPI) of the project? Select one Mark question The SPI is equal to 1.0. The SPI is greater than 1.0. The SPI is less than 1.0. The SPI equals the CPI. ```

Answer 223

A project that is ahead of schedule will have a SPI value greater than 1.0, since it indicates that more work was completed than was planned.

Question 224

Your project has a AC = $800million, PV = $890millions, and a CPI = 1.1. How is the project going? Select one Mark question There is enough money to support an offsite team outing You have no real concerns about either schedule or budget Both the schedule and the budget are better than planned The project is behind schedule

Answer 224

CPI=EV/AC; EV=880; SPI=EV/PV<1

Question 225

A cost management plan contains a description of: Select one Mark question The WBS level at which earned value will be calculated. The project costs. How resources are allocated. The budgets and how they were calculated.

Answer 225

The exam will ask you what the tools of project management contain in order to test whether you really understand them. The cost management plan identifies the WBS level at which earned value will be calculated.

Question 226

While reviewing project performance, the project manager determines that the schedule variance is -500. What is the best thing to do Select one Mark question Move resources from the project to one that is not failing Look for activites that can be done in parallel Determine the cost variance Let the sponsor know

Question 227

``` Your manager is worried about the project schedule. There is a critical deliverable due to the federal government in two weeks. If you miss the deliverable, you could lose the entire contract. To help reduce the manager's stress, you show him the earned value calculations you just completed. They show your cost performance index (CPI) is 1.25, your actual cost (AC) is us $400 million, and your planned value (pv) is us $490 million. Should you manager be comfortable? Select one Mark question Yes, your SV is $10 million He needs more data Yes, your SPI is 1.05 No, your CPI is too high ```

Answer 227

A. Although the SV is $10 million, this does not indicate all the activities are proceeding on schedule. You need to find out if the activities leading up to the critical deliverable are on schedule, in order to comfort your manager. Remember that earned value management (EVM) is a way to discover trends or indications of the way the project is going. You need to examine the details to be sure. You cannot determine schedule problems based on the CPI. The SPI is 1.02, not 1.05, but this does not tell you all the activities are proceeding on schedule. To find SV and SPI you must first find EV. EV = CPI x AC = 1.25 x $400M = $500M. Therefore, SV = EV - PV = $500M - $490M = $10M and SPI = EV / PV = $500M / $490M = 1.020 (use 3-decimal place accuracy).

Question 228

``` Funding requirements for a project are usually in incremental amounts that are not continuous. These increments appear as a step function in the graph depicting Cash flow, Cost baseline and Funding. Any gap at the end of the project between the funds allocated and the cost baseline represents: Select one Mark question Cost variance Contingency reserves Charting error Management reserves ```

Answer 228

Management reserves are included in the project's total funds, but they are not included in the project's cost performance baseline.

Question 229

``` The best description of costs that are directly impacted by the amount of production is: Select one Mark question Fixed costs Variable costs Direct costs Sunk costs ```

Answer 229

A variable cost is a corporate expense that changes in proportion to production output. Variable costs increase or decrease depending on a company's production volume; they rise as production increases and fall as production decreases. Examples of variable costs include the costs of raw materials and packaging.

Question 230

``` A project team budgeted us $3,000 for the work performed and has spent us $4,000 to date. If they budgeted us $5,000 for the work sccheduled, what is the cost variance (CV)? Select one Mark question $2000 $1000 ($1000) ($2,000) ```

Answer 230

EV=3,000; AC=4,000; PV=5,000 CV=EV-AC=-1000

Question 231

``` The difference between the cost baseline and the cost budget can be best described as: Select one Mark question The contingency reserves. The management reserves. The project cost estimate. The cost account. ```

Answer 231

Cost accounts are included in the project cost estimate, and the contingency reserves are added to that to come up with the cost baseline. Thereafter, the management reserves are added to come up with the cost budget. The management reserves make up the difference between the cost baseline and the cost budget.

Question 232

The planned announcement is a closely guarded secret, as the organization does not want the competition to attempt to steal secrets or deflect media attention the project is over budget to date. Which of the following is not a reason this could have occurred? Select one Mark question Work was delayed Work was done inefficiently There was a cost increase from the supplier More work than planned was accomplished

Answer 232

Completing more work than planned, an unexpected cost increase from a supplier, and inefficient performance of work are all reasons a project could be over budget. If work was planned but not done at the time it was scheduled to be completed, funds allocated for that cost would remain unspent, making the project under budget until that work is completed and paid for. It is possible that making up for the work not being done on time could result in the need to crash the project or work overtime, in which case the project could later end up over budget for the activity.

Question 233

The best method to control costs is to: Select one Mark question Estimate during project initiating and have management confirm the estimate Estimate during planning and then resstimate before each activity begins Estimate during project executing and then manage each activity to the budget Estimate at the beginning of the project and then check costs against the baseline

Answer 233

This question focuses on how to control cost, not estimating. Choice 'Estimate during project executing and then manage each activity to the budget' deals with scope. Choice 'Estimate during planning and then resstimate before each activity begins' and 'Estimate during project initiating and have management confirm the estimate' deal with estimating only.

Question 234

``` What does a Cost Performance Index (CPI) of more than 1.0 indicate? Select one Mark question The project is under budget. The project is right on budget. The project is over budget. The project is ahead of schedule. ```

Answer 234

The CPI is calculated as the earned value divided by the Actual Cost. An index of greater than one indicates that you have spent less than you forecasted to this point.

Question 235

``` The formula for Cost Variance is: Select one Mark question CV=SV-BC CV=EV-AC CV=BAC-(AC-EV) CV=AC-EV ```

Answer 235

CV equals earned value (EV) minus actual cost (AC).

Question 236

``` During which project management process group are budget forecasts created? Select one Mark question Planning Monitoring and controlling Initiating Executing ```

Answer 236

Budget forecasts are an output of Control Costs, which is part of monitoring and controlling.

Question 237

``` Bill is the project manager of a software project that was originally estimated to be completed in 12 months. Two months into the project, it is discovered that the original estimating assumptions were fundamentally flawed. The Estimate at Completion (EAC) in such a project will be: Select one Mark question EAC = AC + BAC - EV EAC = AC + [BAC - EV]/CPI EAC = AC + Bottom-up ETC EAC = BAC/CPI ```

Answer 237

The correct response is: EAC = AC + bottom-up ETC, where ac stands for the actual cost and etc stands for the estimate to complete. ETC based on a new estimate must be used because the original assumptions were fundamentally flawed.

Question 238

``` Payment for any decision made or encouraged by a foreign official with respect to whether a company will be awarded a project is best described as: Select one Mark question A progress fee A sunk cost A common practice A bribe ```

Answer 238

We do not hire or fire, reward or punish, or award or deny contracts based on personal considerations, including but not limited to, favoritism, nepotism, or bribery.. When studying for your PMP exam it should be know that this describes a bribe which is always the single best answer.

Question 239

Your cost forecast shows that you will have a cost overrun at the end of the project. Which of the following should you do? Select one Mark question Decrease scope. Eliminate risks in estimates and reestimate. Meet with the sponsor to find out what work can be done sooner. Cut quality.

Answer 239

Look for the choice that would have the least negative impact in this situation. You would not need to meet with the sponsor to determine which work can be done sooner. Cutting quality and decreasing scope always have negative effects. The choice with the least negative impact is to eliminate risks in estimates and reestimate.

Question 240

Bottom-up Cost estimating is typically motivated by the size and complexity of: Select one Mark question The project management software The project budget The statistical relationship between historical data and other variables The individual schedule activity or work package

Answer 240

Bottom-up estimating involves estimating the cost of individual work packages or individual schedule activities at the lowest level of detail. Activities with smaller associated effort usually increase the accuracy of the schedule activity cost estimates.

Question 241

``` You take over a project that is us $100,000 over budget. You know the team has completed us $500,000 worth of work. Your sponsor has been calling all day leaving messages while you were in meetings asking for a quick update on the project status. What will you tell him when you return his call? Select one Mark question Spi is 0.83 Cpi is 0.9 Cpi is 0.83 Spi is 1.1 ```

Answer 241

CV = -$100,000 = EV - AC EV = $ 500,000; => AC = $600,000 CPI = EV/AC = 0.83

Question 242

Monitoring cost expended to date in order to detect variances from the plan occurs during: Select one Mark question Project performance reviews. Updating the cost baseline. Recommending corrective actions. The creation of the cost change management plan.

Answer 242

The correct choice is project performance reviews. Recommending corrective actions and possible updates to the cost baseline result from project performance reviews; they are not concurrent with them. Monitoring costs is part of change control, but not part of creating the change control system.

Question 243

A company has invested significant capital in a current project. The project involves infrastructure and technology changes that will impact private client data, processing of transactions, and the distribution of goods to end users. Recent regulatory changes have made this project a higher priority for the company. While completing the project, the project manager realizes he needs to decrease project costs. There are concerns that this could impact end user satisfaction and create potential compliance issues. After researching his options, he comes up with the following choices. He will need to communicate the recommended option to the project stakeholders. Which choice would decrease project costs? Select one Mark question Change activity A to be completed by resource B instead of resource C. Resource B is a more experienced worker. Remove a test from the project management plan Move activites B and H to occur concurrently, and accept a 30 percent increase in the risk that five more resources will be needed later. Change to component A from component B. Component A costs more to purchase, but has a lower life cycle cost than B

Answer 243

Changing to a component with a lower life cycle cost will not decrease project costs; it will just decrease costs to the organization after the results of the project have transitioned into ongoing business operations. Using a more experienced resource will almost always lead to higher costs, and making activities occur concurrently could affect costs later, due to the increased risk. Although it may not be the first choice to think of, deleting a test would decrease project costs, so it is the best answer offered. It may also decrease quality, there are possible impacts to customer satisfaction but that is not what the question is asking you to solve.

Question 244

``` The project manager has been asked to explain what occurred and what will be done to keep to the budget. Which calculation is the project manager likely to use as a measurement tool to analyze this inforrmation? Select one Mark question EV - PV EV/PV BAC'/CPI EV - AC ```

Answer 244

BAC/CPI is the calculation of estimate at completion (EAC). This will give a forecast of the cost of the project based on the fact that it will need additional hours to complete the work.

Question 245

Your company is in competition to win a major project for the government of a country. Your contacts in that country inform you that you must make a large payment to the foreign minister to be considered for the project. What should you do Select one Mark question Have the local contact make the payment Infrom your company's management, and ask for direction Do not make the payment Make the payment

Question 246

Project costs are estimated for all project activities and are aggregated to establish a cost baseline. Which of the following statements about the cost baseline is not true? Select one Mark question The cost baseline is an output of the determine budget process. The cost baseline includes all authorized budgets, including management reserves. The cost baseline is in the form of an ‘S’ curve. The project cost performance is measured against the cost baselin

Answer 246

The project cost baseline includes all authorized budgets excluding management reserves. Management reserves are not included to measure the cost performance of a project.

Question 247

``` If the project's current total earned value (EV) is $100,000 and the actual amount spent (AC) is $95,000, what is the cost variance of the project? Select one Mark question The cost variance is $-5,000 The cost variance is $1.05 The cost variance is $0.95 The cost variance is $5,000 ```

Answer 247

The Cost Variance (CV) equals EV - AC. In this case, the CV = $5,000.

Question 248

``` Which of the following indicates the required cost performance in order to complete the project on budget? Select one Mark question TCPI SPI CPI EAC ```

Answer 248

The to-complete performance index (TCPI) indicates the required cost performance in order to complete the project on budget.

Question 249

``` A project has a team member assigned to the project full time. What is the most likely effect on the project if that resource completes her activity sooner than planned? Select one Mark question A subsequent activity will be delayed Lower quality Changes to the risk response plan Wasted cost ```

Answer 249

A fulltime team member who completes her work sooner than planned could be forced to wait for the start of her next activity. Since she is fulltime, she would have to paid for time not working.

Question 250

Half way through project executing, a team member alerts you to a potential cost overrun for a specific deliverable. What do you do first Select one Mark question Determine the projected actual cost Determine the cause of the overage Implement a change control process to track the change Inform the customer

Answer 250

A project manager must always evaluate the situation before making a decision

Question 251

While managing a project in another country, you are asked to make a "facilitting" payment so the country officials will issue a work order. What should you do? Select one Mark question Ask the person for proof the payment is required Do not pay and see what happens Seek legal advice on whether such a payment is a bribe Make the payment

Answer 251

Whenever you are uncertain of whether a payment is a bribe, you should discuss the situation with legal counsel.

Question 252

A project with Earned Value (EV) = $1000, Actual Cost (AC) = $800 and Planned Value (PV) = $800. What is the Cost Variance (CV)? ``` Select one Mark question -$200 -$100 $200 -$0 ```

Answer 252

CV = EV – AC CV = $1000 – $800 = $200 Note that the Planned Value (PV) is not used in the calculation.

Question 253

You are the project manager of a housing project in which a total of 10 houses are to be build over 10 months (1 house per month). The total budget for the housing project is $1,000,000. The project is now at the end of the 6th month with 5 houses built and $500,000 spent. The project is behind schedule owing to a work strike for a month. The Cost Performance Index (CPI) for the project is: Select one Mark question 1. 2 0. 9 1. 1 1. 0

Answer 253

The formula to be used to calculate CPI is: CPI = EV / AC CPI = $500,000 / $500,000 = 1.0

Question 254

``` A project team budgeted us $3,000 for the work performed and has spent us $4,000 to date. If they budgeted us $5,000 for the work sccheduled, what is the cost variance (CV)? Select one Mark question $1000 ($2,000) ($1000) $2000 ```

Answer 254

EV=3,000; AC=4,000; PV=5,000 CV=EV-AC=-1000

Question 255

``` You just completed a cost estimate on the project, and you're assuming there is a 15 per chance you will exceed this estimate. You are Select one Mark question Below the mean Above the median Above the mean Below the median ```

Answer 255

With normal distribution, the mean indicates you have a 50 percent chance of being over or under your estimate. Since you have only a 15 percent chance of being over, you are above (or to the tight of) the mean.

Question 256

``` The cost estimates for a project are in the range of +/- 5 %. What phase is the project likely to be in? Select one Mark question A. Closing phase D. Intermediate phase C. Initial phase B. Preliminary phase ```

Answer 256

The project is likely to be in a closing phase since the range of estimates is quite narrow. Early in the project, there is less cost information available and the range of estimates is much higher. As the project progresses, the degree of accuracy improves.

Question 257

Which of the following defines things the project manager needs to do regarding cost Select one Mark question Meet any agreed-upon estimates, estimate larger-sized work components, and accept constraints from management. Never recalculate the estimate to complete, never just accept constraints from management, and only use historical records forr accurate estimates Never just accept constraints from management, periodically recalculate the estimate to complete and meet any agreed-upon estimate. Periodically recalculate the estimate to complete, increase estimates by eliminating risks, and reestimate when changes are requested

Answer 257

The project manager should not just accept management constraints, and estimating smaller components leads to more accurate estimates. Eliminating risks, decreasing costs, and estimating do not occur until a change is approved. The estimate to complete should be updated as the project progresses, and while using historical records is a good practice, it should not be the only source of estimates. The only choice that is completely accurate is: "Never just accept constraints from management, periodically recalculate the estimate to complete, meet any agreed-upon estimates."

Question 258

The most recent analysis of Microcorp's new fabrication facility renovation project shows a CPI value of less than 1.0. What does this indicate? Select one Mark question The cost has underrun estimates. The schedule has slipped. The project is running ahead of schedule. The cost has overrun estimates.

Answer 258

A CPI value of less than 1.0 indicates a cost overrun of the estimates. A CPI value greater than 1.0 indicates a cost underrun of the estimates.

Question 259

Your company wants to assign a resource to your project and asks you to bill that resource to the customer. This concerns you because you get a bonus for maximizing billings to the customer. What is the best thing to do? Select one Mark question Ask for the customer’s approval before adding the resource to the project scope Maximize customer billings in any ethical manner possible Remind the appropriate members of the billing organization that monetary compensation is not worth compromising the integrity of the individual or the organization Ask for clarification of the intent of adding the resource

Answer 259

Professional and social responsibility requires the investigation of any instance where the legitimate interests of the customer may be compromised. If such a compromise is found, action must be taken.

Question 260

The cost contingency reserve should be: Select one Mark question Maintained by management to cover cost overruns. Added to the base costs of the project to account for risks. Hidden to prevent management from disallowing the reserve. Added to each activity to provide the customer with a shorter critical path.

Answer 260

Hiding the reserve is an inappropriate action. Adding cost to each activity will not shorten the critical path, and thus is an incorrect statement. Management reserves, not contingency reserves, are maintained by management to cover cost overruns. During the risk management process, you determine appropriate contingency reserves to cover the cost of identified risks.

Question 261

``` Which of the following estimating techniques will cost less but is also typically less accurate? Select one Mark question Resource Cost-based Estimating Analogous Estimating Parametric Estimating Bottom-up Estimating ```

Answer 261

Analogous cost estimating is typically less costly but also less accurate than other cost estimating techniques. It uses the actual cost of previous, similar projects as the basis for estimating the cost of the current project. It is more reliable when the previous projects are similar in fact and not just in appearance, and the persons estimating have the needed expertise.

Question 262

``` The best description of costs that are directly impacted by the amount of production is: Select one Mark question Fixed costs Sunk costs Variable costs Direct costs ```

Answer 262

A variable cost is a corporate expense that changes in proportion to production output. Variable costs increase or decrease depending on a company's production volume; they rise as production increases and fall as production decreases. Examples of variable costs include the costs of raw materials and packaging.

Question 263

``` Large variations in the periodic expenditure of funds are undesirable for organizational operations. Therefore, the expenditure of funds is frequently reconciled with the disbursement of funds for the project. According to the PMBOK, this is known as: Select one Mark question Budget Reconciliation Expenditure Reconciliation Funding Limit Reconciliation Disbursement Reconciliation ```

Answer 263

This is known as funding limit reconciliation. This will necessitate the scheduling of work to be adjusted to smooth or regulate those expenditures.

Question 264

``` A project manager presented earned value analysis data in a tabular format in a performance report. Another way the project manager could have presented the earned value analysis data is with: Select one Mark question A linear graph An S-curve A logarithmic curve An Epsilon graph ```

Answer 264

The correct response is S-Curve. Both S-Curves and tabular formats can be used to represent earned value analysis data

Question 265

A project manager has completed a detailed wbs and cost estimates for each work package. To create a cost baseline from this data, the project manager will: Select one Mark question Add the work package and risk contingency reserve estimates Gain expert opinions of the project total costs Use the highest level of the WBS to estimate analogously Roll up work package estimates into a project total and add management reserves

Answer 265

Analogous estimating and gaining expert opinions of project cost should have been completed before the finalization of the cost baseline. A cost baseline does not include management reserves. However, it must include a contingency reserve for risks. The project manager must total the work package estimates and risk contingency reserve estimates to create the cost baseline.

Question 266

While working to determine the budget for an avionics project, the company decides to hire a highly reputable financial analyst that has worked in the aviation industry for three decades. Halfway through the project, a series of unanticipated risk events occur, and the project cannot pay its invoices. What is most likely to be the cause? Select one Mark question The management reserves were exhausted The analyst did not identify risks properly The control accounts were not correctly established Funding limit reconciliation was done incorrectly

Answer 266

Management reserves are established specifically to address unknown risks, which are risks that are not identified as part of the Identify Risks process. No matter how thorough the risk identification process is, there will always be unknown risks which may be realized during the project. In this scenario, the cause of the project's inability to pay its invoices is attributed to a series of realized unanticipated risks. This situation suggests that the management reserves were not sufficient to cover all of the unanticipated risks that occurred. Therefore, assuming that the management reserves must have been exhausted is most likely to be the cause for the problem described in the scenario.

Question 267

A project manager is finalizing a project that has had repeated problems with cost conformance. He is concerned about what management will say. Senior managers have talked about the problems multiple times in their executive meetings, and it's been reported they feel their concerns have not been addressed. Which of the following types of information would be best for the project manager to use to evaluate performance? Select one Mark question The most recent CPI The project budget A list of complaints from senior management The last bar chart

Answer 267

The issue here is cost. Ask yourself which choice helps evaluate cost performance. Notice choice 'The project budget'. This deals with cost, but not performance, as there is nothing to compare against the budget listed here. There is no comparison to a previous budget or a comparison of actual to budget. Therefore choice 'The Project budget' cannot be the best. The only choice that addresses cost and performance is 'The most recent CPI'

Question 268

Which of the following is a key way to improve activity cost estimates Select one Mark question Use historical data Base activity estimates on the upper and lower control limits Let the project manager create the activity cost estimates Let management create the management reserve and the activity cost estimates

Question 269

``` The cost of running a project management office is an example of what type of cost? Select one Mark question Fixed Direct Indirect Reimbursable ```

Answer 269

Indirect costs are those costs that cannot be directly traced to a specific project. These costs are accumulated and allocated equitably over multiple projects by an approved and documented accounting procedure.

Question 270

``` An estimating technique that uses a statistical relationship between historical data and other variables (such as square footage in construction or lines of code in software development) is known as: Select one Mark question Analogous Estimating Bottom-up Estimating Parametric Estimating Historical Analysis ```

Answer 270

This technique is known as parametric estimating. It can produce higher levels of accuracy, depending on the sophistication as well as on the underlying resource quantity and cost data built into the model.

Question 271

Variance Analysis is an important tool used in the Control Costs process. Which of the following statements regarding variances is correct? Select one Mark question The percentage range of acceptable variances will tend to decrease as more work is accomplished. The percentage range of acceptable variances will tend to increase as more work is accomplished. The percentage range of acceptable variances is a constant all through the project. The percentage range of acceptable variances is high at the start of a project, tends to decrease in the middle of a project, and then tends to increase as the project nears completion

Answer 271

Variances assess the magnitude of variation from the original cost baseline. The percentage range of acceptable variances will tend to decrease as more work is accomplished and the project nears completion.

Question 272

``` Your company is undergoing a change in ownership and the new owners are looking at the total cost of a new product. Which of the following would best provide that information Select one Mark question Net present value Estimate at completion Life cycle cost Earned value ```

Question 273

A project with Earned Value (EV) = $250, Actual Cost (AC) = $200 and Planned Value (PV) = $350. What is the Schedule Performance Index (SPI)? Select one Mark question 1. 40 0. 71 1. 25 0. 80

Answer 273

The formula to be used to calculate SPI is: SPI = EV / PV SPI = $250 / $350 = 0.71

Question 274

``` As you review the project results, you notice you have spent us $1,200,000 at the last reporting point. You know the schedule performance index (SPI) is 1.1. Considering you feel you should have spent us $1,300,000 to this point, what are the cost performance index (CPI), and the schedule and cost variances? Select one Mark question 1.43, $130,000 and ($130,000) 1.19, $130,000 and $230,000 1.19, $230,000 and ($230,000) 1.1, ($230,000) and $130,000 ```

Answer 274

AC = Actual cost = $1,200,000; PV = Planned valued = $1,300,000 SPI = EV/PV = 1.1; EV = Earned value = 1.1x1,300,000 = 1,4300,000 CPI = EV/AC = 1,430,000/1,200,000 = 1.19 SV = Schedule variances = EV-PV = 130,000 CV = Cost variances = EV-AC = 230,000

Question 275

You have been working with the subject matter experts to estimate the activity durations and costs on the project. All of the following are outputs of the estimate costs process excpet: Select one Mark question The prevention of inappropriate changes from being included in the cost baseline An understanding of the cost risk in the work that has been estimated Documentation of any assumptions made during the Estimate Costs process An indication of the range of possible costs for the project

Answer 275

This question is asking. "'When you finish estimating costs, what do you have?" Many people who do not realize that estimates should be in a range choose that option. Documentation of assumptions is included in the basis of estimates, which is an output of Estimate Costs. The prevention of inappropriate changes is more correctly part of the cost management plan and the change control system.

Question 276

``` A large construction project for a logistics company will require the expenditure of a large amount of capital. The finance group works with the project manager to project set limits when expenses will be incurred in a given project and to determine whether there are ways to smooth out or level the spending to avoid a single large expenditure in one quarter and none in the next. This is an example of: Select one Mark question Funding Limit Reconciliation Levelized Billing A financial review Rescheduling ```

Answer 276

Large variations in the periodic expenditure of funds are usually undesirable for organizational operations. Therefore, the expenditure of funds is reconciled with the funding limits set by the customer or performing organization on the disbursement of funds for the project.

Question 277

``` As the project progresses, you will engage in a process using aggregation, reserve analysis, and expert judgment. These are tools of which process? Select one Mark question Control Schedule Quantitative Risk Analysis Determine Schedule Determine Budget ```

Question 278

You are reviewing the expense report form one of your team members when you notice a payment he made in another country. You think the payment is bribe. What is your first course of action Select one Mark question Contact the payee in the other country and ask if the payment was a bribe Ignore the problem, it is in the past File a permit authorizing the team to make such payments Seek legal advice

Question 279

The main focus of life cycle costing is to Select one Mark question Estimate installation costs. Consider installation costs when planning the project costs. Estimate the cost of operations and maintenance. Consider operations and maintenance costs in making project decisions.

Answer 279

Life cycle costing looks at operations and maintenance costs and balances them with the project costs to try to reduce the cost across the entire life of the project.

Question 280

``` Value analysis is performed to get: Select one Mark question A less costly way of doing the same work. The team to buy into the project. Management to buy into the project. More value from the cost analysis. ```

Answer 280

Notice that you need to know the definition of value analysis to answer this question. Also notice that the other choices could be considered correct by someone who does not know the definition. Value analysis seeks to decrease cost while maintaining the same scope.

Question 281

``` Contingency Reserves are estimated costs to be used at the discretion of the project manager to deal with: Select one Mark question Unanticipated events Anticipated but not certain events Anticipated and certain events Scope creep ```

Answer 281

``` Contingency Reserves are estimated costs to be used at the discretion of the project manager to deal with: Select one Mark question Unanticipated events Anticipated but not certain events Anticipated and certain events Scope creep ```

Question 282

``` Which estimating method tends to be most costly for creating a project cost estimate? Select one Mark question Bottom-up Parametric 50/50 Analogous ```

Answer 282

Because you need project details to estimate this way, the effort expended will be greater with bottom-up estimating.

Question 283

You and everyone involved are inexperienced with the methodology, techniques, and tools. In light of this new approach, what is the best thing to do Select one Mark question Request proper training be provided and paid for by the functional manager Revise the schedule to account forr the decreased effectiveness of inexperienced resources Hire resources from the outside with experience in the methodology, tools and techniques to meet the schedule baseline Revise the project estimate to account for the cost of training team members

Question 284

``` How would you calculate your EAC if the ETC work is performed at the budgeted rate? Select one Mark question EAC= BAC-EV EAC = AC + BAC - EV EAC = BAC/CPI EAC=(BAC-EV)*CPI ```

Answer 284

If the remaining project work is expected to be performed at the budgeted rate, then the formula for EAC is AC + (BAC – EV), where AC is the actual cost, BAC is the budget at completion, and EV is the earned value.

Question 285

``` 72 of 18003:26:06 Sally, a project manager, was reconciling expenditure of funds with funding limits on the commitment of funds for the project. She found a large variance between the funding limits and planned expenditures. As a result, she decided to reschedule work to level out the rate of expenditures. This is: Select one Mark question Funding limit expenditure Funding limit reconciliation Funding limit appropriation Funding limit constraints ```

Answer 285

This is known as funding limit reconciliation. It can be accomplished by placing imposed date constraints for work into the project schedule.

Question 286

Which of the following is incorrect? Select one Mark question Reserves are usually included in the total budget of a project. Management reserves are not part of the project cost baseline. Contingency reserves are not part of the project cost baseline. The project manager needs to get approval before spending management reserve.

Answer 286

Contingency reserves are included in the project cost baseline.

Question 287

Which of the following statements about the planned value, the earned value, the schedule variance, and the cost variance of a project is false? Select one Mark question The schedule variance is the difference between the earned value and the planned value. The planned value is the budget authorized for the work to be performed. The earned value is the value of work to be completed in terms of the approved budget. The cost variance is the difference between the earned value and the actual cost.

Answer 287

Earned value is the value of the work already completed. This value is often expressed in terms of the approved budget assigned to the work completed. The earned value is measured against the performance measurement baseline.

Question 288

``` You just completed the first phase of a multi-phase project. You have calculated earned value measurements and found that the current CPI is 0.79 and the current SPI is 0.98. Your next phase plan should focus first on which element of the project: Select one Mark question Quality Resources Cost Schedule ```

Answer 288

A schedule performance index (SPI) of less than one indicates that less work has completed than planned, and a cost performance index (CPI) of less than one indicates a cost overrun for the work completed. In this scenario, the cost overrun is more severe than the schedule delay. Therefore, you should focus on reducing the cost of the project.

Question 289

``` Your project is midway through a delivery schedule. As the project manager, you want to determine how much work remains. Which is the most accurate way to determine the remaining work the project team must carry out? Select one Mark question Future analysis Rolling wave method Earned Value Technique A Manual forecast ```

Answer 289

Although the Earned Value technique of determining the balance work in the project is quick and straightforward, it is not as valuable or accurate as the Manual Forecasting of the remaining work by the project team. However, manual forecasting is more time-consuming.

Question 290

Your project has a AC = $800million, PV = $890millions, and a CPI = 1.1. How is the project going? Select one Mark question There is enough money to support an offsite team outing The project is behind schedule You have no real concerns about either schedule or budget Both the schedule and the budget are better than planned

Answer 290

CPI=EV/AC; EV=880; SPI=EV/PV<1

Question 291

According to EVM, which term below represents the outstanding amount of money required to finish the project? ``` Select one Mark question Earned Value (EV) Estimate to Complete (ETC) Planned Value (PV) Estimate at Completion (EAC) ```

Answer 291

By definition, Estimate to Completion (ETC) is the amount of money we need to put into the project from today in order to complete it

Question 292

A project manager is developing a cost management plan and needs to determine the best source of funding for a project that is dictated by a legal requirement. The cost of capital is estimated at 9.7% for non-dividend paying equity, 6.7% for debt, and 5.1% for self-funding. The NPV of the project is $500,000 with an opportunity cost of $750,000. What is the project manager's best course of action? Select one Mark question Recommend the termination of the project since another project has a higher NPV Fund the project with equity since there are no dividend obligations Perform an alternatives analysis since there are multiple factors to consider Select the self-funding option since it provides the lowest cost of capital

Answer 292

The question states that the project manager is developing the cost management plan, which indicates that the Plan Cost Management process is being performed. A data analysis technique that can be used for this process includes an alternatives analysis, which is a technique used to evaluate identified options in order to select the options or approaches to use to execute and perform the work of the project. In this case, an alternatives analysis can consist of reviewing funding options such as self-funding, funding with equity, or funding with debt. Even though the question provides some financial data, there are other factors which should be taken into consideration before selecting the appropriate source of funding. Therefore, of the available options, the best course of action for the project manager is to perform an alternatives analysis

Question 293

The success of your new project requires several of your people to work in a foreign country for six months. The team informs you that in this country a payment is required to obtain visas. The payment for the visas is high. The economy has recently become volatile. Some stakeholders question the need for the project and the benefits it will produce. Leadership has told you that this project is aligned with the organization's direction for the year. What should you do? Select one Mark question Cancel the project Do not pay and see what happens Do not send your people Include the payment in the project budget

Answer 293

This type of payment is common and allowable. It should be included in your project budget.

Question 294

``` You are a project manager for a small construction project. Your project was budgeted for u.s. $72,000 over a six week period. As of today, you've spent u.s. $22,000 of your budget to complete work that you originality expected would cost u.s. $24,000. According to your schedule, you should have spent u.s. $30,000 by this point. Based on these circumstances, your project could be best described as: Select one Mark question On budget Not having enough information provided Over budget Under budget ```

Answer 294

CPI = EV/AC. In this case CPI = 24,000/22,000 or 1,09. A CPI of 1,09 indicates that you are under budget.

Question 295

A manufacturing project has a Schedule Performance Index (SPI) of 0.89 and a Cost Performance Index (CPI) of 0.91. Generally, what is the best explanation for why this occurred? Select one Mark question A supplier went out of business and a new one needed to be found. Additional equipment needed to be purchased. The scope was changed. A critical path activity took longer and needed more labor hours to complete.

Answer 295

To answer this question, you must look for a choice that would take longer and cost more. Notice one of the choices says scope was changed, but it was not necessarily added to. If the change was to reduce the scope, it might also have reduced cost. Though it would take time to handle the issue of the need to find a new supplier, the impacted activity might not be on the critical path and thus might not affect time. Purchasing additional equipment definitely adds cost, but not necessarily time. A critical path activity taking longer and requiring more labor hours to complete would negatively affect both time and cost.

Question 296

In which part of the cost management process is earned value (EV) used Select one Mark question Forecasting and project performance reviews Creating the cost base line the cost control system Performance measurement analysis and variance management Reserve analysis and cost aggregation

Answer 296

The key word here is "used". 'creating the cost base line the cost control system' and 'reserve analysis and cost aggregation' occur during project planning rather than project monitoring and controlling.

Question 297

A trend report was given to the project manager, who reacted to the report by investigating what activity or activities had not been done, but should have been done, to date. What did the report show Select one Mark question The schedule performance index (SPI) was 1.3 and the estimate at completion (EAC) was greater than planned. The cost performance index (CPI) was 0.8 and the schedule performance index (SPI) was 1.2 The budget at completion (BAC) was higher than planned Actual cost was below planned and schedule progress was less than planned

Answer 297

You should ask yourself which of the choices would be interepted to mean that work was not done. A schedule performance index (SPI) of less than 1 could mean that work was not done, but there could be other reasons. When you combine cost and schedule you can clearly see that the reason the project has prrogressed more slowly than planned is probably due to work not getting done.

Question 298

You are in the middle of project executing and find you are running out of money due to unanticipated changes. What is the best thing to do Select one Mark question Ask for a change to the project budget Use resources that do not charge against the project Reevaluate the risk analysis and contingency funding Crash or fast track the project

Question 299

``` This has been determined that six additional computers are needed to complete the project. The computers are an example of Select one Mark question Fixed cost Limited cost Indirect cost Diminishing cost ```

Answer 299

A fixed cost is a nonrecurring cost that will not change as the project progresses. Note the additional information unrelated to the question. It was added as a distractor.

Question 300

``` Martin is the project manager of a project that is in an early phase. He needs to estimate costs but finds that he has a limited amount of detailed information about the project. Which of the following estimation techniques is least suited to his requirements? Select one Mark question Analogous Estimating Bottom-up Estimating Top-down Estimating Budgetary Estimating ```

Answer 300

Bottom-up estimating is a technique that can be applied only when there is a sufficient amount of detail available to the project manager.

Question 301

``` Which of the following is an example of a parametric estimate? Select one Mark question Bottom-up Dollars per module Learning bend CPM ```

Answer 301

Parametric estimates use a mathematical model to predict project cost or time.

Question 302

``` You are aware that cost and schedule risks are prevalent in your project. You want to compare the planned project performance with its actual performance during the Monitor Risks process. What should you perform to provide this information? Select one Mark question Risk reassessment Technical Performance Analysis Risk audit Reserve analysis ```

Answer 302

Technical performance analysis, a tool and technique of the monitor risks process, is used to evaluate the differentials between planned and actual costs, schedules, and performance criteria. Several statistical techniques, such as earned value (ev) technique, are used to analyze these variances.

Question 303

``` What is the primary risk when including reserves, or contingency allowances, in your cost estimate? Select one Mark question Overstating the cost estimate Understating the cost estimate Tracking the funds Cancelling your project ```

Answer 303

Contingency funds are used to handle cost uncertainty due to unforeseen events during a project. These funds are generally used for items that are likely to occur but are not certain to occur.

Question 304

A seller submits an invoice that is outside of the funding limit reconciliation during project planning. What is the least likely cause? Select one Mark question Equipment was received earlier than planned The was a cost increase to the successor activity of a critical path activity An activity has taken longer to complete than planned The critical path was fast tracked during project planning

Answer 304

Funding limit reconciliation could result in a schedule compression (fast tracking/crashing) during planning, and the schedule compression during planning process should be in line with the funding limit reconciliation

Question 305

A project with Earned Value (EV) = $250, Actual Cost (AC) = $200 and Planned Value (PV) = $350. What is the Cost Performance Index (CPI)? Select one Mark question 0. 71 1. 25 1. 40 0. 80

Answer 305

The formula to be used to calculate CPI is: CPI = EV / AC CPI = $250 / $200 = 1.25

Question 306

A definitive estimate is Select one Mark question The most expensive to create Within a range of -10per to +25per of actual Created during the initiating process group A level of estimating that can be achieved without the team's help

Answer 306

A great deal of work is needed to fine tune a project so that you can get a definitive estimate.

Question 307

Analogous Cost Estimating is which of the following? Select one Mark question Bottom-up estimating Uses statistical relationship between historical data and other variables Generally accurate Generally less accurate

Answer 307

Analogous cost estimating is usually deemed less accurate than other methods of estimation.

Question 308

A cost management plan contains a description of: Select one Mark question The budgets and how they were calculated. How resources are allocated. The WBS level at which earned value will be calculated. The project costs.

Answer 308

The exam will ask you what the tools of project management contain in order to test whether you really understand them. The cost management plan identifies the WBS level at which earned value will be calculated.

Question 309

Which of these are not inputs to the Determine Budget process? Select one Mark question Cost baseline, requirements traceability matrix Scope baseline, agreements Basis of estimates, cost estimates Risk register, resource management plan

Answer 309

The cost baseline and the requirements traceability matrix are not inputs to the determine budget process. The other choices are valid inputs.

Question 310

The Earned Value Management methodology can be used to: Select one Mark question Calculate the value provided to the customer Forecast future performance based on current performance Calculate the number of days left in the project Calculate the profitability of the project

Answer 310

The earned value management methodology can be used to forecast future performance based on current performance.

Question 311

Estimate at completion (EAC) is a periodic evaluation of: Select one Mark question The cost of work completed. What it will cost to finish the project The value of work performed. The anticipated total cost at project completion.

Answer 311

When you look at earned value, many of the terms have similar definitions. This could get you into trouble. EAC means the estimate at completion. What it will cost to finish the project is the definition of ETC, or estimate to complete.

Question 312

``` Megawatt is estimating the expected cost of a new ERP system deployment project using the actual costs of an earlier similar ERP system deployment project as the basis for the cost. This is what type of estimating? Select one Mark question Parametric Bottom-up Analogous Expert Judgment ```

Answer 312

Analogous cost estimating involves using the actual cost of previous similar projects as the basis for estimating the cost of the current project. Analogous cost estimating is frequently used to estimate costs when there is a limited amount of detailed information about the project (e.g., in the early phases).

Question 313

A project team member runs an earned value analysis (EVA) report. There is an unexpected spike in actual costs over the last three weeks. The team member shows the report to the project manager and based on her analysis presents four possible reasons for the spike. Which reason is most probable? Select one Mark question Fewer employees are showing up for work the past two weeks causing a backlog of unfinished work Soaring steel prices have impacted the fixed price with economic price adjustments procurement contracts Much higher than expected quarterly bonuses were given to executives during that three week period There was a strike at the loading dock which delayed many needed steel shipments until today

Answer 313

Earned value analysis (EVA) is an example of the data analysis techniques that can be used as part of the processes in the Monitoring and Controlling Process Group. In the context of this question, the team member has applied the technique to the Control Costs process. By analyzing the earned values and associated costs of the project, the project team can react or make adjustments or request changes. To know the appropriate action to take, the project manager must know how to interpret the data. In the scenario, the variability of the steel prices would be a probable cause of the actual costs spiking beyond the planned values. The other three options do not directly impact the actual costs of the project within the scenario's circumstances.

Question 314

For the project with original project budget $1000 and both the Cost Performance Index (CPI) and Schedule Performance Index (SPI) equal 1. Assuming the project will continue to spend money at the same rate, what is the Estimate At Completion (EAC) of the project? ``` Select one Mark question $1,000 $1,033 $833 $933 ```

Answer 314

As the project will continue to spend at the same current rate, the formula to be used would be: EAC = BAC/CPI EAC = $1000 / 1 = $1000

Question 315

While analyzing a project, the project manager calculated the ratio of the Earned Value (EV) to the Actual Costs (AC) and obtained a value of 1.2. The project manager decided this was an unfavorable condition for the project and decided to take corrective action. What is your view? Select one Mark question The project manager is correct. The ratio of EV to AC is the Cost Performance Index and a ratio greater than 1 is unfavorable to the project The project manager is not correct. The ratio of EV to AC is the Cost Variance and a ratio greater than 1 is favorable to the project. The project manager is not correct. The ratio of EV to AC is the Cost Performance Index and a ratio greater than 1 is favorable to the project The project manager is correct. The ratio of EV to AC is the Cost Variance and a ratio greater than 1 is unfavorable to the project.

Answer 315

The project manager is not correct. Cost performance index (CPI) is the ratio of EV to AC. A value greater than one represents a favorable condition for the project. The project manager has misinterpreted the situation.

Question 316

``` The Cost Performance Baseline is a time-phased budget and is used as a basis to measure, monitor, and control overall cost performance of the project. It is usually displayed in the form of: Select one Mark question Pie-chart An S-curve An inverted S-curve. A Z curve ```

Answer 316

The correct response is an S-Curve (or S Curve). The cost performance baseline is a time-phased budget and is used as a basis to measure, monitor, and control overall cost performance of the project. It is usually displayed in the form of an s-curve and is developed by summing estimated costs by period

Question 317

What is the difference between expected monetary value and net present value Select one Mark question Expected value is the probability times impact of an opportunity and net present value is the benefits less costs over many time periods. Expected value is the estimated value of risk response plans and net present value helps determine the value of investments. Expected value is the value it takes to recover your investment and net present value is the value of money. Expected value is the estimated value of the work actually accomplished and net present value is the value of the work to be done.

Question 318

While managing a large project, the project manager decided to include indirect costs as part of his cost estimate. If indirect costs are included in an estimate, which of the following is true? Select one Mark question Include indirect costs at the activity level or higher levels Include indirect costs at the activity level only Exclude indirect costs in cost estimates Include indirect costs only in earned value measurements and not in cost estimates

Answer 318

Activity cost estimates are quantitative assessments of the probable costs required to finish project work. If included in project estimates, indirect costs should be included at the activity level or higher levels

Question 319

There have recently been some leadership changes, and you have been asked to present information about your project and what you are doing these plans.what is most likely to happen to the allocation of funds for the plans that created if they are not needed Select one Mark question They are used to provide recognition and rewards for efficicent work by team members They are reallocated within the project by senior management They are deleted from the project budget They are used on the current project at the project manager's discretion

Answer 319

Allocation of fund: Contingency reserve or Known-unknown

Question 320

``` Which of the following represents the estimated value of the work actually accomplished? Select one Mark question Earned value (EV) Cost variance (CV) Planned value (PV) Actual cost (AC) ```

Answer 320

It can be confusing to differentiate earned value terms from each other. The estimated value of the work actually completed is the definition of EV, or earned value.

Question 321

Your project is being completed in another country. It is going reasonably well and is ahead of the cost projections when one of the local officials informs you he will make sure the project work stops unless you pay him us $50. What is the best thing to do? Select one Mark question Offer to pay a smaller amount to discourage future requests for larger amounts Offer to pay more than the requested amount to get more support from the official in the future Do not make the payment Make the payment

Answer 321

Such payment is considered as bribe and could incur fines for the company, and jail time for the PM

Question 322

``` What does it mean if the Earned Value is equal to Actual Cost? Select one Mark question Project is on budget and on schedule There is no schedule variance Schedule Variance Index is 1 There is no cost variance ```

Answer 322

Cv = EV - AC. If the EV is equal to the AC, then there is no Cost Variance on the project.

Question 323

``` The difference between the cost baseline and the cost budget can be best described as: Select one Mark question The cost account. The contingency reserves. The project cost estimate. The management reserves. ```

Answer 323

Cost accounts are included in the project cost estimate, and the contingency reserves are added to that to come up with the cost baseline. Thereafter, the management reserves are added to come up with the cost budget. The management reserves make up the difference between the cost baseline and the cost budget

Question 324

``` A project manager is estimating project costs and needs to decide whether the estimates will include direct costs only or include indirect costs, as well. In which of the following phases does this decision need to take place? Select one Mark question Plan Expenses Determine Budget Estimate Costs Define Scope ```

Answer 324

This is done in the estimate costs process. The project manager works in accordance with the organization's guidelines and decides whether the estimates will be limited to direct project costs only or whether the estimates will also include indirect costs. Indirect costs are those that cannot be traced to one specific project, and are usually allocated equitably over multiple projects.

Question 325

``` Funding requirements for a project are usually in incremental amounts that are not continuous. These increments appear as a step function in the graph depicting Cash flow, Cost baseline and Funding. Any gap at the end of the project between the funds allocated and the cost baseline represents: Select one Mark question Cost variance Charting error Contingency reserves Management reserves ```

Answer 325

Management reserves are included in the project's total funds, but they are not included in the project's cost performance baseline.

Question 326

Variance analysis refers to cost performance measurements used to determine the magnitude of variation in comparison to the original cost baseline. What is the trend on the percentage range of acceptable variances as the project progresses? Select one Mark question The percentage range of acceptable variances will tend to decrease first and then increase as the project progresses beyond 50 percent completion. The percentage range of acceptable variances will tend to increase as the project progresses. The percentage range of acceptable variances remain the same as the project progresses. The percentage range of acceptable variances will tend to decrease as the project progresses.

Answer 326

At the start of the project, larger percentage variances are acceptable. However, as more work is accomplished, the percentage range of acceptable variances will tend to decrease.

Question 327

``` During the conceptual phase of a pipeline project, the project engineer estimates the following. The cost of the materials is most likely us $100,000, optimistically u $90,000, and pessimistically us $120,000. The cost for labor is most likely us $80,000, optimistically us $70,000, and pessimistically us $100,000. The cost for equipment is most likely us $60,000, optimistically us $50,000, and pessimistically us $70,000. The cost for construction management fees is most likely us $30,000, optimistically us $20,000, and pessimistically us $40,000. What is the probability of the project coming in under us $270,000? Select one Mark question Over 50 percent Exactly 50 percent Less than 50 percent Zero ```

Answer 327

You use the PERT calculation (P + 4M + 0)/6) to compute a weighted average of the totals, which in this case equals U.S. $273,333. This number represents the mean (or 50 percent point). Therefore the probability of the project coming in at U.S. $273,333 is 50 percent. The probability of U.S. $270,000 (since it is less than the mean) is less than 50 percent.

Question 328

A large, complex construction project in a foreign country requires the movement of heavy equipment through crowded city streets. The officials in the city know that you have a large, complicated project and that staying on schedule and within budget is important to your company. You have coordinated moving equipment in other countries for other projects without problems. To ensure the equipment is transported successfully, your contact in the country informs you that you will have to pay the local police a fee for coordinating traffic. What should you do? Select one Mark question Do not pay the fee because it is a bribe Eliminate the work Do not pay the fee if it is not part of the project estimate Pay the fee

Question 329

``` Breaking down project activities into smaller components in order to obtain a more accurate cost estimate and then aggregating the estimates of the lower-level components is: Select one Mark question Analogous estimating Decomposition Bottom-up estimating Work breakdown structure ```

Answer 329

This is an example of bottom-up estimating. When an activity is complex and cannot be accurately estimated, it is broken down into smaller components for estimation. These individual component estimates are then summed up to obtain the cost estimate of the activity.

Question 330

You are the project manager of a road paving project. A total of 10km of road is to be paved over a 5-month period. The total budget for the project is $10,000. The project is now at the end of the 3rd month with 8km of road paved and $8,000 spent. The Schedule Performance Index (SPI) for the project is: Select one Mark question 1. 20 0. 98 1. 33 0. 78

Answer 330

Since the road is assumed to be paved linearly, i.e. 2km of road per month. At the end of 3rd month, the PV should be $6,000 (for 6km of road). The formula to be used to calculate SPI is: SPI = EV / PV SPI = $8,000 / $6,000 = 1.33

Question 331

``` Company abc is evaluating three consulting companies to find a consultant to perform professional services. They request information on how the three consulting companies allocate fringe benefits to their clients. What type of cost is company abc asking about Select one Mark question Direct Variable Indirect Fixed ```

Answer 331

Fringe benefits are included in overhead and are part of indirect costs.

Question 332

The customer responsible for overseeing your project asks you to provide a written cost estimate that is 30% higher than your estimate of the project's cost. He explained that the budgeting process requires managers to estimate pessimistically to ensure enough money is allocated for projects. What is the best way to handle it Select one Mark question Ask for information on risks that would cause your estimate to be too low Add the 30% as a lump sum conginency fund to handle project risks Add the 30% to your cost estimate by spreading it evenly across all project activites Create one cost baseline for budget allocation and a second one for the actual project management plan

Answer 332

Presenting anything besides your original estimate calls into question your competence and integrity as a PM.

Question 333

``` You are in the initiation phase of your project, and you believe the project can be completed for $100,000. However, you are an experienced project manager and know that many things can happen between the initiation phase and the closure of the project. In the project charter, you have provided an estimate of $75,000 to $175,000. This is an example of: Select one Mark question True Estimate Narrow Estimate Absolute Estimate Rough Order of Magnitude Estimate ```

Answer 333

A rom estimate is supplied in the beginning of a project and is defined as -25% to +75% of the estimated cost.

Question 334

Two efficiency indicators that reflect the cost and schedule performance of a project are: Select one Mark question Cost Performance Index (CPI) and Schedule Performance Index (SPI) Actual Cost (AC) and Planned Value (PV) Cost Pricing Index (CPI) and Schedule Performance Index (SPI) Cost Projection Index (CPI) and Schedule Projection Index (SPI)

Answer 334

The cost performance index (CPI) and the schedule performance index (SPI) are two efficiency indicators that reflect the cost and schedule performance of the project.

Question 335

122 of 18003:26:06 What does estimate at completion (EAC) mean Select one Mark question Estimated average cost at project completion The anticipated total cost at project completion. Each anticipated cost for the project Anticipated expenses at project completion

Answer 335

Explanation When you look at earned value, many of the terms have similar definitions. This could get you into trouble. EAC means the estimate at completion. What it will cost to finish the project is the definition of ETC, or estimate to complete.

Question 336

``` The organization that you work for supports the achievement of its strategic objectives by empowering project managers and teams. The project managers have the authority to structure their teams, plans, and work however they deem necessary to best ahieve results. They are responsible for controlling the schedule and the budget, and for providing the steering committee and other departments of the organizations with forecasts. Which part of the cost budget would these project managers not have control over? Select one Mark question Contingency reserves Management reserves Control account estimates Cost baseline ```

Answer 336

Project Budget = Cost Baseline + Management Reserve Project Budget = Cost Baseline + Management Reserve

Question 337

``` At the end of a project, what will your schedule variance be equal to? Select one Mark question Zero Equal to the total PV Equal to the total EV One ```

Answer 337

The Schedule Variance is the Earned Value minus the Planned Value. At the end of the project, all of the Planned Values should be earned, and the difference should be zero.

Question 338

``` Costs incurred in one area of a project can offset costs in another area of the same project. However, it is not enough to consider only the costs of project execution when making project decisions. What other costs external to the project must also be considered? Select one Mark question Costs of conformance Planning costs Operating costs Initiating costs ```

Answer 338

Project cost management is primarily concerned with the cost of the resources needed to complete schedule activities. However, project cost management should also consider the effect of project decisions on the costs of using, maintaining, and supporting the product, service, or result of the project.

Question 339

Which of the following structures helps track project costs and can align with the organization’s accounting system? Select one Mark question Organizational breakdown structure (OBS) Project breakdown structure (PBS) Work Breakdown Structure (WBS) Matrix breakdown structure (MBS)

Answer 339

The work breakdown structure (WBS) provides the framework for the cost management plan. The wbs contains control accounts, which link directly to the performing organization's accounting system.

Question 340

``` Rodney is in the process of preparing the project performance report for the team meeting. He is expecting many questions from his stakeholders on the budget and schedule. He calculates the following values: Budget at Completion (BAC) = $22,000, Earned Value (EV) = $13,000, Planned Value (PV) = $14,000, Actual cost (AC) = $15,000. What is the Estimate at Completion (EAC) for the project, if the work is performed at the budgeted rate? Select one Mark question $22,500 $37,000 $36,000 $24,000 ```

Answer 340

If the project work is performed at the budgeted rate, the estimate at completion can be computed using the formula EAC = AC + (BAC-EV). Substituting all these values in the expression, EAC = $15,000 + ($22,000 - $13,000) = $24,000.

Question 341

``` Your manager is worried about the project schedule. There is a critical deliverable due to the federal government in two weeks. If you miss the deliverable, you could lose the entire contract. To help reduce the manager's stress, you show him the earned value calculations you just completed. They show your cost performance index (CPI) is 1.25, your actual cost (AC) is us $400 million, and your planned value (pv) is us $490 million. Should you manager be comfortable? Select one Mark question Yes, your SV is $10 million No, your CPI is too high He needs more data Yes, your SPI is 1.05 ```

Answer 341

A. Although the SV is $10 million, this does not indicate all the activities are proceeding on schedule. You need to find out if the activities leading up to the critical deliverable are on schedule, in order to comfort your manager. Remember that earned value management (EVM) is a way to discover trends or indications of the way the project is going. You need to examine the details to be sure. You cannot determine schedule problems based on the CPI. The SPI is 1.02, not 1.05, but this does not tell you all the activities are proceeding on schedule. To find SV and SPI you must first find EV. EV = CPI x AC = 1.25 x $400M = $500M. Therefore, SV = EV - PV = $500M - $490M = $10M and SPI = EV / PV = $500M / $490M = 1.020 (use 3-decimal place accuracy).

Question 342

You have always been asked by your management to cut your project cost estimates by 10 percent after you submitted them. The scope of your new project is unclear, and there are over 30 stakeholders. Management expects a 25 percent reduction in downtime as a result of the project. Which of the following is the best course of action in this situation? Select one Mark question Provide an accurate estimate of the actual costs and be able to support your estimate Replan to achieve a 35 percent improvement in downtime Meet with the team to identify where you can find 10 percent savings Reduce the estimate and note the change in the risk response plan

Answer 342

A. This is a common problem on projects. If your estimates are accurate, you are ethically bound to stand by them. Management's only option to cut cost is to support the project manager in looking for alternatives related to all project constraints.

Question 343

``` Which of the following methods of forecasting EAC and ETC is the most accurate? Select one Mark question ETC based on new estimate ETC based on CPI and SPI ETC based on CPI ETC based on BAC ```

Answer 343

The bottom-up ETC gives the most accurate results.

Question 344

For a project with Earned Value (EV) = $300, Actual Cost (AC) = $350 and Planned Value (PV) = $400. The overall project budget is $1,000. Assume that you will continue to spend at the same rate as you are currently spending. What is the Variance At Completion (VAC)? ``` Select one Mark question $167 $150 -$150 -$167 ```

Answer 344

As the project will continue to spend at the same current rate, the formula to be used would be: VAC = BAC – EAC EAC = BAC/CPI CPI = EV/AC VAC = BAC – BAC/(EV/AC) =$1000 – $1000/($300/$350) = -$167

Question 345

For the project with Earned Value (EV) = $360, Actual Cost (AC) = $400 and both Cost Performance Index (CPI) and Schedule Performance Index (SPI) equal 0.90. The original project budget is $1,000. Assuming the remaining work will be impacted by the current cost performance and current schedule performance, what is the Estimate At Completion (EAC) of the project? ``` Select one Mark question $1,390 $1,290 $1,190 $1,090 ```

Answer 345

As the project will be impacted by the current cost performance and current schedule performance, the formula would be: EAC = AC + [(BAC-EV)/(SPI*CPI)] EAC = $400 + [($1000 – $360) / (0.9 * 0.9)] = $1190

Question 346

``` Earned value analysis is the basis for: Select one Mark question Performance reporting Integrating the project components into a whole Ishikawa diagrams Planning control ```

Answer 346

Earned value analysis is a great reporting tool. With it, you can show where you stand on budget and schedule as well as provide forecasts for the rest of the project

Question 347

134 of 18003:26:06 To-complete performance index (TCPI) is represented by which of the following? Select one Mark question (BAC-EV)/(BAC-AC) A measure of the value of work completed compared to the actual cost or progress A measure of progress achieved compared to progress planned AC + (BAC - EV)

Answer 347

The To Complete Performance Index (TCPI) gives you the future cost performance index that you must follow for the remaining work if you want to complete it within the given budget TCPI= (Remaining Work) / (Remaining Funds)

Question 348

``` The formula for Cost Variance is: Select one Mark question CV=SV-BC CV=EV-AC CV=AC-EV CV=BAC-(AC-EV) ```

Answer 348

CV equals earned value (EV) minus actual cost (AC).

Question 349

You are having difficulty estimating the cost of a project. Which of the following best describes the most probable cause of your difficulty Select one Mark question Inadequate scope definition Lack of historical records from previous projects Lack of company processes Unavailability of desired resources

Answer 349

Although all choices could cause difficulty, only inadequate scope definition makes estimating impossible.

Question 350

``` A project is estimated to cost $50,000 with a timeline of 50 days. After 25 days, the project manager finds that 50 percent of the project is complete and actual costs are $50,000. What is the Cost Performance Index (CPI)? Select one Mark question The CPI is 2 The CPI is 1.5 The CPI is 1 The CPI is 0.5 ```

Answer 350

The correct answer is 0.5. The Cost Performance Index (CPI) is given by the formula CPI = EV/AC where ev is the Earned Value and AC is the Actual Cost. Since 50% of the project is complete, Earned Value = 50% of $50,000 = $25,000. Hence CPI = 25,000/50,000 = 0.5.

Question 351

Jackie is the project manager of a large project. During the Determine Budget process, she identifies that contingency reserves need to be set up for unplanned but potentially necessary changes that could result from realized risks identified in the risk register. Which of the following is true about reserves? Select one Mark question Contingency Reserves are not a part of project cost baseline, but will be included in the total budget for the project Both the Management Reserves and the Contingency Reserves are not part of project cost baseline, but they are included in the total budget for the project Both the Management Reserves and the Contingency Reserves are part of project cost baseline, and they are also not included in the total budget for the project Management Reserves are not a part of project cost baseline, but will be included in the total budget for the project

Answer 351

Management reserves are not a part of the project cost baseline but will be included in the total budget for the project.

Question 352

The project manager is working on a high-profile project where completing the project within budget is critical. The project manager is new, but well-trained, and is excited to see that the project is spending less than budgeted. As a result, the project manager was planning to take a holiday when a more senior project manager warned him that he has some important work to do on the project. Why would the senior project manager give such a warning on this project Select one Mark question The project manager neeeds to create a project control system to make sure there are no problems in the future A project that is under budget may also have contracts that need to be managed Team meetings should be scheduled every week and a holiday would mean that one team meeting would have to be cancelled The project manager should look at how the cost performance compares to the schedule performance

Answer 352

Since a project control system is created during planning, that cannot be best. There is nothing in the situation described, or in standard project management practice, that would say taking a holiday would be a problem with contracts. Team meetings are scheduled as needed by the project and frequency is determined during project planning. The project manager should understand reasons a project may be under budget so he can determine when to take action and what action to take.

Question 353

140 of 18003:26:06 A project manager is trying to plan for a contingency reserve as part of the cost estimates for the project. Which of these would be an incorrect way to plan for contingency reserves? Select one Mark question Start the project with a zero value for contingency reserve. Plan for contingency reserve as a percentage of the estimated cost. Use quantitative analysis methods to arrive at the contingency reserve. Plan for contingency reserve as a fixed number.

Answer 353

It would be incorrect to start the project with a zero value for contingency reserves. One of the three other methods listed could be used to arrive at a contingency reserve number. As more precise information about the project becomes available, the contingency reserve may be used, reduced, or eliminated.

Question 354

``` You are working on the performance reporting for the project you are managing. Schedule performance is the top constraint. As you are gathering the data, you need information for the formulas that you will be reporting on. Which of the following represents the value of work actually completed Select one Mark question Estimate to complete Earned value Actual cost Planned value ```

Answer 354

EV is earned value or the budgeted cost of the work performed. In order words, the value of the work completed is terms of what you budgeted (your baseline).

Question 355

``` A definitive estimate is in a range from Select one Mark question (10 per) to 10 per from actual (-30 per) to 40 per from actual (10 per) to 25 per from actual (25 per) to 75 per from actual ```

Answer 355

This question is designed to determine whether you understand that estimates should be in a range and what are the standard ranges.

Question 356

``` You are the Project Manager for JT's Lumber Yard. You are trying to forecast estimates for the final phase of the project you are currently working on. Based on the performance of the project to date, which formula can be used to estimate the total value of the project when completed, assuming similar variances will not occur? Select one Mark question SV = EV - PV ETC = (BAC - EV)/CPI CPI = EV/AC EAC = AC + BAC - EV ```

Answer 356

The formula EAC = AC + BAC - EV is used to determine the total value of the project when completed, assuming similar variances will not occur for the uncompleted project activities.

Question 357

Cost performance measurement is best done through which of the following? Select one Mark question Calculating earned value and using the indexes and other calculations to report past performance and forecast future performance Using the 50/50 rule and making sure the life cycle cost is less than the project cost Focusing on the amount expended last month and what will be expended the following month Asking for a percent complete from each team member and reporting that in the monthly progress report

Answer 357

Asking percent complete is not a best practice since it is usually a guess. Often the easiest work is done first on a project, throwing off any percentage calculations of work remaining. The life cycle cost cannot be lower than the project cost, as the life cycle cost includes the project cost. Focusing on the amount spent last month and what will be spent in the next month is often done by inexperienced project managers who know of nothing else. Not only does this provide little information, but the data cannot be used to predict the future. Using earned value and other calculations is the best answer since this choice looks at the past and uses that information to estimate future costs.

Question 358

For a project with Estimate at Completion (EAC) = $120,000 and Cost Performance Index (CPI) is 0.90. What is the Budget at Completion (BAC)? ``` Select one Mark question $118,000 $108,000 $208,000 $158,000 ```

Answer 358

As no information is given on the future performance of the project, we could safely assume that the project will spend at the same rate. So we will make use of the formula: EAC = BAC / CPI $120,000 = BAC / 0.90 BAC = $120,000 * 0.90 = $108,000

Question 359

``` The Budget at Completion (BAC) for a project is $50,000. The Actual Costs (AC) to date are $10,000. The Earned Value (EV) is $7,000. At this stage, the project management team did a manual bottom-up summation of costs and forecast an Estimate to Complete (ETC) of $50,000. What is the Estimate at Completion (EAC) for the project? Select one Mark question $40,000 $60,000 $57,000 $53,000 ```

Answer 359

When a bottom-up manual forecasting has been done for the ETC, the calculation for EAC is EAC = AC + bottom-up ETC. Hence, EAC = 10,000 + 50,000 = $60,000. Note that the bac is no longer viable at this stage.

Question 360

``` The approximate resource costs necessary for completing project activities are compiled during which project management process Select one Mark question Forecasting Cost aggregation Estimate costs Funding limit reconciliation ```

Answer 360

Choices 'cost aggregation' and 'cost reserve analysis' (funding limit reconciliation). 'Forecasting' occurs as part of cost control.

Question 361

You provide a project cost estimate for the project to the project sponsor. He is unhappy with the estimate, because he thinks the price should be lower. He asks you to cut 15 percent off the project estimate. What should you do? Select one Mark question Start the project and constantly look for cost savings. Add additional resources with low hourly rates Inform the sponsor of the activities to be cut. Tell all the team members to cut 15 percent from their estimates.

Answer 361

This question is full of choices that are not correct project management actions. To answer the question, you must first realize that it is never appropriate for a project manager to just cut estimates across the board. You should have created a project estimate based on realistic work package estimates that do not include padding. Then, if costs must be decreased, you can look to cut quality, decrease risk, cut scope, or use cheaper resources (and at the same time closely monitor the impact of changes on the project schedule). One of the worst things a project manager can do is to start a project knowing that the time or cost for the project is unrealistic. Did you notice the choice of adding additional resources? Even though they have low hourly rates, that would add cost. Evaluating, looking for alternatives, and then reporting the impact of the cost cutting to the sponsor is the best action to take

Question 362

``` A project manager is analyzing the project to find ways to decrease costs. It would be best the project manager looks at Select one Mark question Variable costs and fixed costs. Indirect costs and direct costs Direct costs and variable costs. Fixed costs and indirect costs ```

Answer 362

Direct costs are directly attributable to the project, and variable costs are costs that vary with the amount of work accomplished. It is best to look at decreasing these costs on the project.

Question 363

Early in the life of your project, you are having a discussion with the sponsor about what estimating techniques should be used. You want a form of expert judgment, but the sponsor argues for analogous estimating. It would be best to: Select one Mark question Suggest life cycle costing as a compromise. Agree to analogous estimating, as it is a form of expert judgment. Try to convince the sponsor to allow expert judgment because it is typically more accurate. Determine why the sponsor wants such an accurate estimate.

Answer 363

This is a tricky question. Determining why the sponsor wants such an accurate estimate sounds like a good idea at first. However, analogous estimates are less accurate than other forms of estimating, as they are prepared with a limited amount of detailed information. Reading every word of this choice helps eliminate it. In order to pick the best answer, you need to realize that analogous estimating is a form of expert judgment.

Question 364

According to EVM, which term below represents the budgeted cost of the work to be completed to date? ``` Select one Mark question Estimate at Completion (EAC) Planned Value (PV) Earned Value (EV) Estimate to Complete (ETC) ```

Answer 364

By definition, Planned Value (PV) is how much value of work was scheduled to achieve to date.

Question 365

You are managing a new oil purification project in a foreign country. A person informs you that you will have to pay him a "transfer fee" for the permit to move heavy equipment through the city. What is the first thing you should do? Select one Mark question Do not pay the fee Negotiate openly with the city officials Pay the fee, but only to the city Make sure the person is really a government official

Answer 365

ONLY government officials can collet routine government fees

Question 366

``` If you are managing changes to the project's cost baseline, which process are you using? Select one Mark question Estimate Costs Control Costs Negotiate Costs Determine Budget ```

Answer 366

Control costs is the process of managing the project's costs and the changes that threaten the bottom line.

Question 367

``` Which of the following does not assess the value project management brings to an organization? Select one Mark question Net present value. Needs assessment Value analysis. Cost benefit analysis. ```

Answer 367

Value analysis is a way of finding the least expensive way to do the work.

Question 368

``` 155 of 18003:26:06 A rough order of magnitude estimate is made during which project management process group? Select one Mark question Planning Closing Initiating Executing ```

Answer 368

This estimate has a wide range. It is done during project initiating, when very little is known about the project.

Question 369

``` A project manager is performing Reserve Analysis as a technique in one of the project management processes he is currently working on. Which of the following is likely to be that process? Select one Mark question Estimate Reserves Report Costs Plan Costs Estimate Costs ```

Answer 369

Many cost estimators include reserves (also called contingency allowances) as costs in their schedule activity cost estimates. Contingency reserves are estimated costs to be used at the discretion of the project manager to deal with anticipated but not certain events. These events are "known unknowns" and are part of the project scope and cost baselines.

Question 370

Your manager has asked you for a cost baseline for the project, but it is early in the project management process and there is very little project information. In this circumstance, what is the best way to estimate this project? Select one Mark question Calculate an estimate using the schedule model. Ask the team for estimates of each activity. Extrapolate from historical data. Provide a rough order of magnitude estimate.

Answer 370

It is early in the project management process; you have not yet identified actitivies, nor do you have a schedule model. It is best to provide estimates based on an understading of this project

Question 371

``` One common way to compute estimate at completion (EAC) is to take the budget at completion (BAC) and: Select one Mark question Multiply by cpi Multiply by spi Divide by cumulative cpi Divide by spi ```

Answer 371

This question is asking for the formula for EAC, which is BAC/CPI0. You have to remember the formula to get the answer correct.

Question 372

``` You are managing a hotel construction project, and you have asked your project team to calculate the current earned value metrics to determine the project performance. Your team reports back that the project's to-complete performance index (TCPI) is 0.9 based on the budget at completion (BAC). Which of the following is true regarding your project's current situation as reflected by this TCPI value? Select one Mark question The project is within budget The project is behind schedule The project is over budget The project is ahead of schedule ```

Answer 372

The to-complete performance index (TCPI) is a measure of the cost performance that is required to be achieved with the remaining resources in order to meet a specified management goal, expressed as the ratio of the cost to finish the outstanding work to the remaining budget. A TCPI value equal to 1.0 means you are right on budget, and as long as you maintain the present cost performance index (CPI), you should not exceed the project budget. A TCPI value greater than 1.0 means you need to take a stricter cost management approach or you will exceed your budget at completion (BAC). A TCPI value less than 1.0 indicates you are within your budget and have done an excellent job of managing project costs

Question 373

``` You have estimated the project cost to be us $850k within -25/+75 percent of actual. This is a Select one Mark question Budget estimate Rough order of magnitude estimate Definitive estimate Parametric estimate ```

Answer 373

ROM (Rough Order of Magnitude Estimate: (-25% / 75% ) Thường đường dùng trong giai đoạn Init, không có dự liệu chi tiết (without detailed data). Preliminary Estimate mức độ chính xác -15% / +50% Budget Estimate (-10% / 25%) Dùng trong giai đoạn Planning Definitive Estimate (-5% / 10%)

Question 374

You are a project manager working on a project that requires 100 items to be tested, spaced evenly over five weeks. You have just begun week three, with an overall budget of us $10,000. To date, you have spent us $2,000 with 40 items tested successfully. What does the cost variance (CV) tell you in this circumstance? Select one Mark question The project is $2,000 under budget. The project is getting $2 of work for every dollar spent. The project is on budget. The project is proceeding at 100 percent of the expected rate.

Answer 374

EV is determined from a total budget of $10,000 and a five week duration. Each week would be $2,000. Therefore, for two weeks of completed work, we have an EV of $4,000. CV = EV - AC, CV = $4,000 - $2,000 = $2,000. Positive means you are under budget.

Question 375

163 of 18003:26:06 The best method to control costs is to: Select one Mark question Estimate at the beginning of the project and then check costs against the baseline Estimate during project initiating and have management confirm the estimate Estimate during planning and then resstimate before each activity begins Estimate during project executing and then manage each activity to the budget

Answer 375

This question focuses on how to control cost, not estimating. Choice 'Estimate during project executing and then manage each activity to the budget' deals with scope. Choice 'Estimate during planning and then resstimate before each activity begins' and 'Estimate during project initiating and have management confirm the estimate' deal with estimating only.

Question 376

``` A management team is trying to decide if it will continue working on a project that has spent us $500,000. The original estimate for work completed to date was us $200,000. The difference between the actual cost and the original estimate, is a(n): Select one Mark question Direct cost Sunk cost Customer cost Example of how bad the schedule was ```

Answer 376

If you throught the answer was 'Example of how bad the schedule was', reread it. It says, "schedule". There is no way to know if the schedule was bad

Question 377

``` The project has reached a stage where work is being done in seven countries. Project team members need to know in which currency they are to report their cost data. Which of the following should they reference? Select one Mark question Cost estimates Cost breakdown structure Cost management plan Cost baseline ```

Answer 377

The cost management plan provides information and guidance on how the project manager and project team are to plan, structure, account, and control the project costs. The contents of the plan vary based on the needs of the particular project. The project in the scenario is operating in many countries and currencies. To align all the project documents and communications, it is important for this project's cost management plan to detail the currencies to use or not use, when, in which circumstances, and other pertinent requirements of the project. The plan is the go-to location for the team to use the proper cost denotations.

Question 378

``` Which of the following information about the project would never be available during project planning Select one Mark question Cost performance index Internal rate of return Budget at completion Benefit cost ratio ```

Answer 378

B. This question does not say whether the information is estimated or actual, but it does use the word “never.” The cost performance index is determined based on performance. Therefore, it would never be determined during project planning. The other choices could be determined as estimates

Question 379

``` Advantage of bottom-up estimates Select one Mark question They require good project definition before estimating begins Overall project costs will be capped They are more accurate They are less costly to creat ```

Answer 379

Bottom-up estimating: Accuracy is +/-20% more than Top-down +/-50%

Question 380

While reviewing project performance, the project manager determines that the schedule variance is -500. What is the best thing to do Select one Mark question Let the sponsor know Look for activites that can be done in parallel Determine the cost variance Move resources from the project to one that is not failing

Question 381

The six-month project has 300 work packages and a us $600,000 budget. Three months into the project, 150 work packages are complete and us $300,000 has been spent. Which of the following is correct? Select one Mark question There is not enough information The project needs 50 more work packages to be completed to be on time The project is on time and on budget The project manager should reevaluate cost performance but not worry about time

Answer 381

Do you think that all work packages have the same effort and cost to accomplish?

Question 382

``` A budget estimate is in the range from Select one Mark question -5 percent to +10 percent from actual -25 percent to +75 percent from actual -10 percent to +10 percent from actual -10 percent to +25 percent from actual ```

Answer 382

Preliminary estimate: within the range of -15% to +50% Budget estimate: within the range of -10% to +25% Final estimate: 100% accurate

Question 383

The Actual Cost (AC) is the total cost actually incurred and recorded in accomplishing work performed for an activity or work breakdown structure component. What is the upper limit for the AC? Select one Mark question The Actual Cost (AC) is limited to the Planned Value (PV). There is no upper limit for the Actual Cost (AC). 50 percent over and above the Planned Value (PV) 100 percent over and above the Planned Value (PV)

Answer 383

There is no limit to the actual cost (AC). Whatever is spent to achieve the earned value (EV) is measured as the actual cost.

Question 384

``` As part of the Estimate Costs process, a project manager obtained access to certain commercially available databases to get resource cost rate information. Such published commercial information is considered what type of input? Select one Mark question Enterprise environmental factor Organizational process asset HR Input Historical information ```

Answer 384

Such published commercial information is considered part of enterprise environmental factors that influence the estimate costs process.

Question 385

``` Your vice president asked you what the Estimate at Completion (EAC) will be for a small project you are working on. You were given a budget of $30,000, and to date you have spent $20,000 but only completed $10,000 worth of work. You are sure the future work will be accomplished at the planned rate. What is the EAC? Select one Mark question $10,000 $40,000 $30,000 $60,000 ```

Answer 385

If the future work will be accomplished at the planned rate, then the Estimate At Completion (EAC) will be AC+BAC-EV. Budget At Completion (BAC) is $30,000, Earned Value (EV) is $10,000, and Actual Cost (AC) is $20,000. Hence, the EAC is $40,000

Question 386

What would be the best explanation for the following: both the cost variance and schedule variance are negative, but the cost variance is lower than the schedule variance Select one Mark question The project activities took longer then excepted, but cost were lower The project underspent, because costs were lower than planned and activities were easier to complete than planned The project underspent because all work was not completed, but overspent work that was completed The project overspent due to increased costs and yet completed some activities faster

Answer 386

Since SV is negative, in reality the project is taking longer time than planned but ...... that eliminates this choice Since CV is negative, in reality the project is incurring higher costs ...... that eliminates this choice also. Both SV & CV are negative means in reality project is lagging and incurring higher costs ...... eliminated

Question 387

``` In an underground highway construction project, the project stakeholders have suggested many changes to the project scope. You had already defined the cost baseline in your project, and you would like to revisit the baseline to see how these changes might affect the overall cost of the project. You start an impact analysis to determine the impact and inform the concerned stakeholders of all approved changes and the corresponding costs. You perform these activities in which process? Select one Mark question Monitor Communications Monitor Risks Control Costs Control Scope ```

Answer 387

The control costs process involves many activities, such as influencing the factors that change the cost baseline, managing the changes, and informing stakeholders of approved changes and corresponding costs. Since you are in the process of managing the cost changes and informing the stakeholders about them, you are in the control costs process.

Question 388

Although the stakeholders thought there was enough money in the budget, halfway through the project the cost performance index (CPI) is 0.7. To determine the root cause, several stakeholders audit the project and discover the project cost budget was estimated analogously. Although the activity estimates add up to the project estimate, the stakeholders think something was missing in how the estimate was completed. Which of the following describes what was missing? Select one Mark question Bottom-up estimating should have been used. SPI should be used, not CPI. Past history was not taken into account. Estimated costs should be used to measure CPI.

Answer 388

Actual costs are used to measure CPI, and there is no reason to use SPI in this situation. Using past history is another way of saying “analogous.” The best way to estimate is bottom-up. Such estimating would have improved the overall quality of the estimate.

Question 389

You are a project manager who is in charge of an important project for your company. The project is 40 percent complete after three months and has cost $350,000. The budget for the project is $950,000 and is scheduled to last eight months. How is the project performing? Select one Mark question The project is ahead of schedule and under budget. The project is behind schedule and under budget. The project is behind schedule and over budget. The project is ahead of schedule and over budget.

Answer 389

CPI=EV/AC. CPI = (950000*40%)/350000 = 380000/350000 = 1.09 (under budget). SPI=EV/PV. SPI = 380000/(950000*0.375) = 380000/356,250 = 1.07 (ahead of schedule).

Question 390

``` What does a Cost Performance Index (CPI) of more than 1.0 indicate? Select one Mark question The project is ahead of schedule. The project is over budget. The project is under budget. The project is right on budget. ```

Answer 390

The CPI is calculated as the earned value divided by the Actual Cost. An index of greater than one indicates that you have spent less than you forecasted to this point.

Question 391

As the project manager of a large project, you have just completed the Estimate Costs process. As you begin the Determine Budget process, which of the following would you require as inputs to the process from the Estimate Costs process? Select one Mark question Activity cost estimates, activity resource estimates Resource breakdown structure, agreements Activity cost estimates, basis of estimates Activity cost estimates, staff management plan

Answer 391

Activity cost estimates are quantitative assessments of the probable costs required to complete project work. The basis of estimates consists of additional details supporting the cost estimate. These include documentation of the basis for the estimate, documentation of all assumptions, documentation of any known constraints and indication of the range of possible estimates. These are produced during the estimate costs process and form inputs to the develop budget process.

Question 392

``` A project was estimated to cost $200,000 with a timeline of 10 months. Due to a shipment delay, the schedule was slightly delayed. However, this was made up by shipping the first batch of materials for the project by air. The net result was that there was some additional cost in the project. At the end of the second month, the Project Manager reviews the project and finds that the project is 20% complete and Actual Costs are $50,000. The Estimate to Complete (ETC) for the project would now be: Select one Mark question $210,000 $160,000 $250,000 $200,000 ```

Answer 392

The Budget At Completion (BAC) = $200,000 (given). The Actual Cost (AC) = $50,000 (given). The Earned Value (EV) = (2/10) * 200,000 since 20% of the project is complete; i.e., 2 months out of 10. Hence, Earned Value (EV) = $40,000. This is an instance of an atypical situation in the project. Late arrival of materials does not mean that all subsequent material will arrive late. Hence, the calculation used for EAC is EAC = AC + BAC – EV = 50,000 + 200,000 – 40,000 = $210,000. Since ETC = EAC – AC = 210,000 – 50,000 = $160,000.