PMP - Project Management Professional Managing Budget and Costs Questions and Answers

Question 1

A project has a Cost Performance Index (CPI) of 0.85 and a Schedule Performance Index (SPI) of 1.05. Based on these metrics, what is the current status of the project?

Accepted Answer

The project is over budget and ahead of schedule.

Answer

The project is under budget and behind schedule.

Answer

The project is over budget and behind schedule.

Answer

The project is under budget and ahead of schedule.

Question 2

A project manager is establishing the project budget. The sum of the cost estimates for the individual work packages is $500,000. Through risk analysis, the team identifies known risks and allocates an additional $50,000 to address them if they occur. This $550,000 total is then approved as the performance measurement baseline. What does the $50,000 represent?

Accepted Answer

Contingency Reserve

Answer

Management Reserve

Answer

Sinking Fund

Answer

Cost Baseline

Question 3

A project has a Budget at Completion (BAC) of $300,000. At the current status check, the Earned Value (EV) is $120,000, and the Actual Cost (AC) is $150,000. The project manager believes the cost variances experienced so far are typical and will continue for the remainder of the project. What is the Estimate at Completion (EAC)?

Accepted Answer

$375,000

Answer

$330,000

Answer

$300,000

Answer

$270,000

Question 4

Which of the following is a key output of the Determine Budget process?

Accepted Answer

Cost Baseline

Answer

Cost Estimates

Answer

Change Requests

Answer

Basis of Estimates

Question 5

A project is significantly over budget. The project sponsor wants to know the cost performance required for the remaining work to finish the project exactly on its original budget (BAC). Which metric should the project manager provide?

Accepted Answer

To-Complete Performance Index (TCPI)

Answer

Cost Performance Index (CPI)

Answer

Estimate at Completion (EAC)

Answer

Variance at Completion (VAC)

Question 6

A project manager is preparing a cost estimate for a new software development project. Due to the high level of uncertainty in the initial stages, the project manager uses the costs from a similar, completed project as a basis for the estimate. Which estimating technique is being used?

Accepted Answer

Analogous Estimating

Answer

Parametric Estimating

Answer

Bottom-up Estimating

Answer

Three-Point Estimating

A project has a Cost Performance Index (CPI) of 0.85 and a Schedule Performance Index (SPI) of 1.05.Based on these metrics, what is the current status of the project?

A project has a Cost Performance Index (CPI) of 0.85 and a Schedule Performance Index (SPI) of 1.05.
Based on these metrics, what is the current status of the project?