CPE Cost Estimation & Budget Control 3

Question 1

Which estimating method is most accurate but also the most time-consuming?

Accepted Answer

Bottom-up estimating

Answer

Bottom-up estimating requires detailed estimation of each work package, making it the most accurate and most labor-intensive method.

Question 2

In earned value management, what does the Budget at Completion (BAC) represent?

Accepted Answer

The total planned value when the project is complete

Answer

BAC is the total authorized budget for the project, representing the sum of all planned values at completion.

Question 3

A project manager notices the SPI is 0.8 and CPI is 0.9. Which statement is most accurate?

Accepted Answer

The project is behind schedule and over budget

Answer

SPI < 1 means behind schedule; CPI < 1 means over budget — both performance indices are below 1.

Question 4

What is the purpose of a cost baseline in project management?

Accepted Answer

To serve as the approved time-phased budget against which performance is measured

Answer

The cost baseline is the approved, time-phased budget used to measure and monitor project cost performance.

Question 5

Rough Order of Magnitude (ROM) estimates typically carry an accuracy range of:

Accepted Answer

-25% to +75%

Answer

ROM estimates are typically accurate within -25% to +75% and are used in early project phases when limited information is available.

(CPE) Certified Planning Engineer Practice Test