CPC Project Budget & Cost Control

Question 1

What is the cost baseline in project management?

Accepted Answer

The approved time-phased budget used to measure and monitor project cost performance

Answer

The cost baseline is the approved, time-phased budget that serves as the reference point for earned value analysis.

Question 2

Analogous estimating uses:

Accepted Answer

Historical data from similar past projects to estimate cost or duration

Answer

Analogous estimating is a top-down technique that leverages actual results from similar previous projects.

Question 3

Which cost estimate type has the widest accuracy range and is produced earliest in the project?

Accepted Answer

Rough order of magnitude (ROM)

Answer

A ROM estimate is produced with minimal information and typically carries an accuracy range of -25% to +75%.

Question 4

Management reserve differs from contingency reserve in that:

Accepted Answer

Management reserve covers unknown unknowns, while contingency reserve covers known risks

Answer

Contingency reserve addresses identified risks; management reserve handles unforeseen issues that fall outside the risk register.

Question 5

A project has spent $50,000 but was supposed to spend $40,000 by this point. This means the project is:

Accepted Answer

Over budget (cost overrun)

Answer

Spending more than planned at a given point signals a cost overrun that must be investigated and addressed.

CPC - Certified Project Coordinator Practice Test