Practice Test GeeksADM - Agile Delivery Manager Certification Practice Test
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Budgeting & Financial Management Flashcards

7 cards from real ADM practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Budgeting & Financial Management flashcards as text

  1. What is the primary purpose of establishing a minimum viable budget (MVB) for an agile initiative?

    Answer: To fund the smallest experiment that can validate a business hypothesis

    An MVB funds a minimal set of work to test a hypothesis, enabling evidence-based decisions about whether to invest more before full budget commitment.

  2. In SAFe, which financial construct replaces traditional project-based budgeting at the portfolio level?

    Answer: Value stream budgeting with guardrails

    SAFe uses value stream budgeting with guardrails to fund long-lived value streams, giving teams financial autonomy within approved boundaries.

  3. An Agile Delivery Manager presents a business case using NPV analysis. Which assumption is most critical to validate first?

    Answer: The discount rate and timing of expected cash flows

    NPV is highly sensitive to the discount rate and cash flow timing; incorrect assumptions here distort the entire investment decision.

  4. What is the key advantage of time-boxing in agile from a financial management perspective?

    Answer: It creates a natural financial checkpoint that limits uncontrolled spending

    Time-boxing constrains duration, which constrains spend, giving the organization a predictable cadence at which to review investment decisions.

  5. Which practice helps an Agile Delivery Manager maintain financial transparency with business stakeholders throughout delivery?

    Answer: Publishing burn-up charts and forecasts at sprint reviews

    Sharing burn-up charts and updated forecasts at sprint reviews keeps stakeholders informed and enables timely funding decisions.

  6. What does a 'budget guardrail' in lean portfolio management define?

    Answer: Upper and lower spending boundaries for a value stream without needing re-approval

    Guardrails set acceptable spending ranges within which value stream teams can self-manage, reducing governance overhead while maintaining financial control.

  7. When comparing agile and waterfall from a financial risk perspective, which statement is most accurate?

    Answer: Agile reduces financial risk by delivering value incrementally and enabling early course correction

    Incremental delivery allows organizations to validate investment returns early and pivot or stop funding before sunk costs accumulate, reducing overall financial risk.