CCM Cost Management 5

Question 1

A construction manager conducts a 'constructability review' during design. What is the primary cost management benefit?

Accepted Answer

It identifies construction issues early when changes are least expensive to make

Answer

Constructability reviews during design catch potential construction problems early, when design changes cost far less than field changes.

Question 2

What does 'bid shopping' refer to in construction procurement, and why is it considered unethical?

Accepted Answer

Revealing a subcontractor's bid to competitors to drive down prices after award

Answer

Bid shopping undermines fair competition by using one subcontractor's price to pressure others, damaging trust and often reducing quality.

Question 3

On a large construction project, what is the purpose of a 'project control budget' separate from the contract value?

Accepted Answer

It is an internal working budget including cost targets and contingencies used to manage costs proactively

Answer

The project control budget is the internal management tool that sets cost targets for each work package, enabling proactive cost control.

Question 4

Which earned value metric best indicates whether a project will finish on time?

Accepted Answer

Schedule Performance Index (SPI)

Answer

SPI = EV / PV measures schedule efficiency; an SPI below 1.0 indicates the project is behind its planned schedule.

Question 5

A construction manager must allocate shared equipment costs across multiple project work packages. Which method is most appropriate?

Accepted Answer

Use an equitable allocation basis such as hours used or area served by each work package

Answer

An equitable allocation basis (such as usage hours) ensures shared equipment costs are fairly distributed across work packages benefiting from the equipment.

(CCM) Certified Construction Manager Practice Test

(CCM) Certified Construction Manager Practice Test

CCM Cost Management 5