PMP Managing Budget and Costs 4

Question 1

A project is 40% complete, has spent $80,000, and was planned to spend $70,000 for work completed. The BAC is $150,000. What is the Estimate to Complete (ETC) using the formula EAC = AC + (BAC - EV)?

Accepted Answer

$90,000

Answer

EV = 40% × $150,000 = $60,000; EAC = $80,000 + ($150,000 - $60,000) = $170,000; ETC = EAC - AC = $170,000 - $80,000 = $90,000.

Question 2

Which cost estimating tool uses expert judgment from multiple specialists who independently provide estimates that are later compiled and reviewed anonymously?

Accepted Answer

Delphi technique

Answer

The Delphi technique collects anonymous expert input through iterative rounds to reach consensus without the influence of group pressure.

Question 3

A project sponsor asks why the project budget is higher than the cost baseline. What is the most likely explanation?

Accepted Answer

Management reserves are included in the budget but not the cost baseline

Answer

The project budget includes both the cost baseline and management reserves, while management reserves are held outside the cost baseline.

Question 4

During cost control, a project manager identifies a significant variance. At what threshold should variances typically trigger corrective action?

Accepted Answer

Variances beyond defined thresholds established in the cost management plan

Answer

The cost management plan defines variance thresholds that trigger corrective action, ensuring focus on significant deviations.

Question 5

Which life-cycle costing concept considers the total cost of ownership, including acquisition, operation, and disposal costs?

Accepted Answer

Life cycle cost

Answer

Life cycle cost encompasses all costs associated with a deliverable over its entire life, from acquisition through disposal.

PMP - Project Management Professional Practice Test

PMP - Project Management Professional Practice Test

PMP Managing Budget and Costs 4