Program Management Professional Program Financial Management

Question 1

What is a program budget baseline used for in PgMP?

Accepted Answer

To serve as the approved reference point against which actual program expenditures are measured

Answer

The program budget baseline is the approved financial plan used to measure, monitor, and control actual costs throughout the program lifecycle.

Question 2

Earned Value Management (EVM) in program management uses which three core values to measure performance?

Accepted Answer

Planned Value (PV), Earned Value (EV), and Actual Cost (AC)

Answer

EVM tracks Planned Value (what was planned to be done), Earned Value (the value of work actually completed), and Actual Cost (what was actually spent).

Question 3

A Cost Performance Index (CPI) of 0.85 in a program indicates:

Accepted Answer

The program is spending $1.00 for every $0.85 of value delivered — over budget

Answer

A CPI below 1.0 means the program is over budget, with $1.00 being spent for every $0.85 of earned value delivered.

Question 4

Which financial document provides a long-range view of program expenditures mapped to the program timeline?

Accepted Answer

Program Budget Forecast

Answer

The Program Budget Forecast maps expected expenditures to the program timeline, providing visibility into when funds will be needed across the program lifecycle.

Question 5

What is 'management reserve' in the context of program financial management?

Accepted Answer

An amount held by management for unplanned, unknown risks outside the program scope baseline

Answer

Management reserve is withheld by management to address unknown risks (unknown unknowns) and requires management approval to access.

Program Management Professional Practice Test

Program Management Professional Practice Test

Program Management Professional Program Financial Management