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Overrun is the additional percentage amount by which estimates exceed actual costs. |
False |
|
The primary output of the planning cost management process is a change request. |
False |
|
IT project managers must be able to present and discuss project information both in financial and technical terms. |
True |
|
Project managers must conduct cash flow analysis to determine net present value. |
True |
|
Intangible costs can be easily measured in monetary terms. |
False |
|
When deciding what projects to invest in or continue, one should include sunk costs |
False |
|
If an important supplier goes out of business, management reserves can be set aside to cover the resulting costs. |
True |
|
Contingency reserves are also known as unknown unknowns. |
False |
|
Budgetary estimates are made even before a project is officially started. |
False |
|
Estimates should become more accurate as time progresses. |
True |
|
Supporting details for an estimate include the ground rules and assumptions used in creating the estimate. |
True |
|
Analogous estimates are the most accurate technique to estimate costs. |
False |
|
In a bottom-up estimate, the size of the individual work items is one of the factors that drives the accuracy of the estimates. |
True |
|
Parametric models are reliable when the models are flexible in terms of the project’s size. |
True |
|
One of the reasons why project cost estimates are inaccurate is because human beings are biased toward underestimation. |
True |
|
It is important for project managers to understand that every cost estimate is unique. |
True |
|
The project management plan and project funding requirements are inputs of the process of controlling costs. |
True |
|
The formulas for variances and indexes start with EV, the earned value. |
False |
|
If the cost performance index (CPI) is less than 100 percent, the project is under budget. |
False |
|
A schedule performance index of one means that the project is on schedule |
True |
|
_____ includes the processes required to ensure that a project team completes a project within an approved budget. |
Project Cost Management |
|
Which of the following involves developing an approximation of the costs of resources needed to complete a project? |
Estimating Costs |
|
One of the main outputs of the _____ process is a cost baseline. |
… |
|
____ helps develop an accurate projection of a project’s financial expenses and benefits. |
Life-cycle costing |
|
_____ are those costs that are difficult to measure in monetary terms. |
Intangible Coata |
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Newtech Inc. hires John for the position of a software programmer to work on their new project. Salary paid to John by Newtech Inc. would be an example of _____ costs |
Direct |
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Direct costs are: |
Not directly related to the products or services of a project. |
|
Soles is a footwear company which has recently set up its store in Ambrosia. To manufacture its products, Soles incurs a range of different costs. Which of the following would be an example of an indirect cost? |
Electricity used to run its locations |
|
Good Earth, a company manufacturing packaged food products, sets up its stores in Baltonia. However, a year later, the company closes the store down due to high operating costs. In such a scenario, the money spent in paying for the rent of the store in Baltonia would be an example of _____ costs. |
Sunk |
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Which of the following reserves allows for future situations that are unpredictable? |
… |
|
The first step in project cost management is: |
Develop estimates |
|
A rough order of magnitude estimate can be referred to as a _____ estimate. |
Ballpark |
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A cost estimation tool which is used to allocate money into an organization’s budget is known as a _____ estimate. |
Buggetary |
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A _____ estimate is used for making many purchasing decisions for which accurate estimates are required and for estimating final project costs. |
Definitive |
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Analogous estimates are also known as _____ estimates |
Top-Down |
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_____ uses project characteristics in a mathematical model to estimate project costs. |
Parametric Estimating |
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Which of the following is most likely to be a reason for inaccuracies in information technology cost estimates? |
… |
|
If the cost estimate for a project is a basis for contract awards and performance reporting, it should be a(n) _____ estimate and as accurate as possible |
Definitive |
|
Which of the following is an output of the process of controlling costs? |
… |
|
Which of the following is true of earned value? |
t is an estimate of the value of the physical work actually completed. |
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