CAPM Time & Cost Management 2 — Questions and Answers
Question 1: A project manager calculates the Schedule Variance (SV) as -$15,000. What does this indicate?
- The project is under budget
- The project is behind schedule (Correct answer)
- The project is ahead of schedule
- The project has exceeded scope
Correct answer: The project is behind schedule
A negative SV (EV - PV) means the project has earned less value than planned, indicating it is behind schedule.
Question 2: Which scheduling technique uses three time estimates — optimistic, pessimistic, and most likely — to calculate activity durations?
- Critical Path Method (CPM)
- Precedence Diagramming Method (PDM)
- Program Evaluation and Review Technique (PERT) (Correct answer)
- Resource Leveling
Correct answer: Program Evaluation and Review Technique (PERT)
PERT uses weighted average of optimistic, most likely, and pessimistic estimates to calculate expected duration.
Question 3: What is the Budget at Completion (BAC) used for in Earned Value Management?
- Calculating the actual cost spent so far
- Representing the total planned value of the project (Correct answer)
- Estimating the remaining cost to finish the project
- Measuring schedule performance
Correct answer: Representing the total planned value of the project
BAC is the total authorized budget for the project and represents the sum of all planned values.
Question 4: A project team is using fast tracking to recover schedule time. Which risk does this primarily introduce?
- Increased project costs only
- Reduced project scope
- Increased rework due to parallel activities (Correct answer)
- Loss of stakeholder confidence
Correct answer: Increased rework due to parallel activities
Fast tracking overlaps sequential activities in parallel, which can increase rework if upstream deliverables change.
Question 5: Which type of dependency between activities is defined as 'Activity B cannot start until Activity A finishes'?
- Start-to-Start (SS)
- Finish-to-Start (FS) (Correct answer)
- Start-to-Finish (SF)
- Finish-to-Finish (FF)
Correct answer: Finish-to-Start (FS)
Finish-to-Start is the most common dependency, requiring the predecessor to finish before the successor can start.
Question 6: When a project's Cost Performance Index (CPI) is 0.85, what does this mean?
- The project is getting $1.18 of value for every $1 spent
- The project is getting $0.85 of value for every $1 spent (Correct answer)
- The project is 85% complete
- The project is 15% over its planned duration
Correct answer: The project is getting $0.85 of value for every $1 spent
A CPI of 0.85 means only $0.85 of planned value is being earned for every dollar actually spent.
Question 7: Which cost estimating technique uses actual costs from previous similar projects as the basis for estimating the current project?
- Bottom-up Estimating
- Parametric Estimating
- Analogous Estimating (Correct answer)
- Three-Point Estimating
Correct answer: Analogous Estimating
Analogous estimating uses historical data from similar past projects and is considered a top-down estimating approach.
CAPM Time & Cost Management 2
A project manager calculates the Schedule Variance (SV) as -$15,000.
What does this indicate?