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40 Cards in this Set
- Front
- Back
You are using earned value progress reporting for your current project in an effort to teach your software developers the benefits of earned value. You plan to display project results on the cafeteria bulletin board so that the team knows how the project is progressing. Use the current status, listed below, to answer questions 1 through 4:
According to earned value analysis, the SV and status of the project described above is—
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d. –$200; the project is behind schedule
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What is the CPI for this project, and what does it tell us about cost performance thus far?
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b. 0.80; actual costs have exceeded planned costs
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The CV for this project is—
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d. –$500
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What is the EAC for this project, and what does it represent?
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a. $12,500; the revised estimate for total project cost (based on performance thus far)
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You have now prepared your cost management plan so now you are preparing your project’s cost estimate. You decided to use analogous estimating. Which of the following is NOT characteristic of analogous estimating?
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c. Has an accuracy rate of ±10% of actual costs
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All the following are outputs of the estimate cost process EXCEPT—
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d. Cost baseline
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You must consider direct costs, indirect costs, overhead costs, and general and administrative costs during cost estimating. Which of the following is NOT an example of a direct cost?
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d. Electricity
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If the cost variance is the same as the schedule variance and both numbers are greater than zero, then—
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b. The variance is favorable to the project
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You are responsible for preparing a cost estimate for a large World Bank project. You decide to prepare a bottom-up estimate because your estimate needs to be as accurate as possible. Your first step is to—
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c. Identify and estimate the cost for each work package or activity
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Management has grown weary of the many surprises, mostly negative, that occur on your projects. In an effort to provide stakeholders with an effective performance metric, you will use the to-complete performance index (TCPI). Its purpose is to—
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b. Determine the cost performance needed to complete the remaining work within management’s financial goal for the project
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If operations on a work package were estimated to cost $1,500 and finish today but, instead, have cost $1,350 and are only two-thirds complete, the cost variance is—
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c. –$350
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When you review cost performance data on your project, different responses will be required depending on the degree of variance or control thresholds from the baseline. For example, a variance of 10 percent might not require immediate action, whereas a variance of 100 percentwill require investigation. A description of how you plan to manage cost variances should be included in the—
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a. Cost management plan
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As of the fourth month on the Acme project, cumulative planned expenditures were $100,000. Actual expenditures totaled $120,000. How is the Acme project doing?
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d. The information is insufficient to make an assessment.
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On your project, you need to assign costs to the time period in which they are incurred. To do this, you should—
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b. Use the project schedule as an input to determine budget
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You have a number of costs to track and manage because your project is technically very complex. They include direct costs and indirect (overhead) costs. You have found that managing overhead costs is particularly difficult because they—
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d. Are usually beyond the project manager’s control
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If you want to calculate the ETC based on your expectations that similar variances to those noted to date will not occur, you should use which of the following formulas?
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a. ETC = BAC – EV
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You receive a frantic phone call from your vice president who says she is going to meet with a prospective client in 15 minutes to discuss a large and complex project. She asks you how much the project will cost. You quickly think of some similar past projects, factor in a few unknowns, and give her a number. What type of estimate did you just provide?
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c. Order-of-magnitude
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Your approved cost baseline has changed because of a major scope change on your project. Your next step should be to—
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b. Issue a change request
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Which of the following is a tool for analyzing a design, determining its functions, and assessing how to provide those functions’ cost effectively?
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d. Value engineering
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The cumulative CPI has been shown to be relatively stable after what percentage of project completion?
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b. 15% to 20%
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The undistributed budget is part of the—
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b. Performance measurement baseline
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It is expensive to lease office space in cities around the world. Office space can cost approximately USD $80 per square foot in Tampa, Florida. And it can cost approximately ¥50,000 per square meter in Tokyo. These “averages” can help a person to determine how much it will cost to lease office space in these cities based on the amount of space leased. These estimates are examples of—
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Parametric estimating
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Your project manager has requested that you provide him with a forecast of project costs for the next 12 months. He needs this information to determine if the budget should be increased or decreased on this major construction project. In addition to the usual information sources, which of the following should you also consider?
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d. Costs that have been authorized and incurred
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There are a number of different earned value management rules of performance measurement that can be established as part of the cost management plan. Which one of the following is NOT an example of such a rule?
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a. Code of accounts allocation provision
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Which of the following calculations CANNOT be used to determine EAC?
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a. EV to date plus the remaining project budget
EAC is a forecast of the most likely total value based on project performance and risk quantification. To calculate EAC, the AC of a project must be known and used in the calculation. Any calculation that relies solely on the EV will not yield an accurate measure of cost performance. [Monitoring and Controlling] |
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Typically, the statement “no one likes to estimate, because they know their estimate will be proven incorrect” is true. However, you have been given the challenge of estimating the costs for your nuclear reactor project. A basic assumption that you need to make early in this process is—
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a. How direct and indirect costs will be handled
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By reviewing cumulative cost curves, the project manager can monitor—
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c. CVs
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Control accounts—
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d. Represent the basic level at which project performance is measured and reported
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Performance review meetings are held to assess schedule activity and work packages over-running or under-running the budget and to determine any estimated funds needed to complete work in progress. Typically, if EV is being used, all but which of the following information is determined?
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c. Time reporting systems
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Overall cost estimates must be allocated to individual activities to establish the cost performance baseline. In an ideal situation, a project manager would prefer to prepare estimates—
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a. Before the budget is complete
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According to learning curve theory, when many items are produced repetitively—
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c. Unit costs decrease in a regular pattern as more units are produced
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The method of calculating the EAC by assuming the ETC work will be performed at the same cumulative CPI incurred by the project to date is used most often when—
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c. Current variances are viewed as typical of future variances
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Increased attention to return on investment (ROI) now requires you to complete a financial analysis of the payback period on your project. Such an analysis identifies the—
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c. Amount of time before net cash flow becomes positive
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A revised cost baseline may be required in cost control when—
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a. CVs are severe, and a realistic measure of performance is needed
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As project manager, you identified a number of acceptable tolerances as part of your earned value management system. During execution, some “unacceptable” variances occurred. After each “unacceptable” variance occurred, you did which one of the following first?
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d. Documented lessons learned
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Assume that the project cost estimates have been prepared for each activity and the basis of these estimates has been determined. Now, as the project manager for your nutrition awareness program in your hospital, you are preparing your budget. Because you have estimates for more than 1,200 separate activities, you have decided to first—
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a. Aggregate these estimates by work packages
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The cumulative cost curve for planned and actual expenditures—
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a. Helps to monitor project performance at a glance
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The reason that the cost performance index (CPI) is shown as a ratio is to—
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c. Provide the ability to show performance for a specified time period for trend analysis
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Assume that your actual costs are $800; your planned value is $1,200; and your earned value is $1,000. Based on these data, what can be determined regarding your schedule variance?
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b. At –$200, the physical progress is being accomplished at a slower rate than is planned, indicating an unfavorable situation.
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The CPI on your project is 0.84. This means that you should—
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d. Place emphasis on improving the productivity by which work was being performed
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