CCC Cost Estimation & Budgeting

Question 1

Which cost estimation method relies on historical data and expert judgment?

Accepted Answer

Analogous estimation

Answer

Bottom-up estimation

Answer

Parametric estimation

Answer

Monte Carlo simulation

Question 2

What is the main purpose of a contingency reserve in budgeting?

Accepted Answer

To cover unforeseen risks and uncertainties

Answer

To increase profit margins

Answer

To reduce material costs

Answer

To eliminate cost variances

Question 3

Which cost estimation technique uses mathematical models and statistical data?

Accepted Answer

Parametric estimation

Answer

Analogous estimation

Answer

Three-point estimation

Answer

Expert judgment

Question 4

What is the purpose of Earned Value Management (EVM) in cost control?

Accepted Answer

To track project cost efficiency and schedule performance

Answer

To estimate total project duration

Answer

To replace budgeting entirely

Answer

To eliminate project risk factors

Question 5

Which factor is critical in determining an accurate project budget?

Accepted Answer

Scope definition

Answer

Team size

Answer

Project location

Answer

Marketing strategy

Question 6

What is a key benefit of using a bottom-up estimation approach?

Accepted Answer

It provides highly detailed and accurate cost projections

Answer

It is the fastest estimation method

Answer

It eliminates cost overruns

Answer

It does not require historical data