Review Questions

1. All of the following are true regarding the Project Cost Management Knowledge Area processes except for which one? (Choose the least correct answer.)

A. The primary concern of the Project Cost Management Knowledge Area is determining the amount of resources needed to complete project activities.

B. The Estimate Costs and Determine Budget processes can be combined into one process for small projects.

C. The Estimate Cost process is closely linked with the Estimate Activity Resources process.

D. General management techniques such as ROI, discounted cash flow, and payback analysis can be used to help derive cost estimates.

2. This document is used to establish the criteria for planning, estimating, budgeting, and controlling costs.

A. Cost performance baseline

B. Performance management baseline

C. Project funding requirements

D. Cost management plan

3. You are a project manager working for iTrim Central and you're preparing your cost management plan. You know that all of the following are true regarding this plan except for which one?

A. The WBS provides the framework for this plan.

B. Units of measure should be described in the plan usually as hours, days, weeks, or lump sum.

C. This plan is a subsidiary of the project management plan.

D. Control thresholds should be described in the plan as to how estimates will adhere to rounding ($100 or $1000 and so on).

4. You are a project manager working for iTrim Central. Your organization has developed a new dieting technique that is sure to be the next craze. One of the deliverables of your feasibility study was an analysis of the potential financial performance of this new product and your executives are very pleased with the numbers. You will be working with several vendors to produce products, marketing campaigns, and software that will track customers' progress with the new techniques. For purposes of performing earned value measurements for project costs, you are going to place which of the following in the WBS?

A. Chart of accounts

B. Code of accounts

C. Control account

D. Reserve account

5. All of the following are inputs of the Estimate Costs process except for which one?

A. Resource calendars

B. Scope baseline

C. Project schedule

D. Human resource plan

6. You want to improve your activity cost estimates by taking into account estimation uncertainty and risk. Which of the following tools and techniques will you use?

A. Analogous estimates

B. Three-point estimates

C. Parametric estimates

D. Bottom-up estimates

7. You have received estimates for activity costs associated with one work package of the WBS. Additional contingencies have been added to the estimates to account for cost uncertainty. Which of the following tools and techniques of Estimate Costs does this describe?

A. Reserve analysis

B. Three-point estimates

C. Vendor bid analysis

D. Analogous estimates

8. You have received the following estimates for a complex activity that is critical to the success of your project. The most likely estimate is $42, the optimistic estimate is $35, and the pessimistic estimate is $54. What is the expected activity cost of this activity (rounded to the nearest dollar)?

9. You are the project manager for a custom home-building construction company. You are working on the model home project for the upcoming Show Homes Tour. The model home includes Internet connections in every room, talking appliances, and wiring for home theaters. You are working on the cost performance baseline for this project. All of the following statements are true except which one?

A. This process aggregates the estimated costs of project activities, including risks and contingency reserves.

B. The cost performance baseline will be used to measure variances and future project performance.

C. This process assigns cost estimates for expected future period operating costs.

D. The cost performance baseline is the time-phased budget at completion for the project.

10. Your project sponsor has requested a cost estimate for the project. She would like the cost estimate to be as accurate as possible because this might be her one and only chance to secure the budget for this project because of recent cuts in special projects. You decide to use_.

A. analogous estimating techniques

B. bottom-up estimating techniques

C. top-down estimating techniques

D. expert judgment techniques

11. You are the project manager for a custom home-building construction company. You are working on the model home project for the upcoming Show Homes Tour. The model home includes Internet connections in every room, talking appliances, and wiring for home theaters. You are working on the Determine Budget process. All of the following statements are true except which one?

A. You document the funding limit reconciliation to include a contingency for unplanned risks.

B. You discover that updates are needed to the risk register as a result of performing this process.

C. You document that funding requirements are based on a quarterly basis and are derived from the cost baseline.

D. The performance measurement baseline will be used to perform earned value management calculations.

12. Which of the following is displayed as an S curve?

A. Funding requirements

B. Cost performance baseline

C. Cost estimates

D. Expenditures to date

13. All of the following are tools and techniques of the Determine Budget process except for which one?

A. Reserve analysis

B. Expert judgment

C. Historical relationships

D. Cost of quality

14. Your project sponsor has requested a cost estimate for the project on which you're working. This project is similar in scope to a project you worked on last year. She would like to get the cost estimates as soon as possible. Accuracy is not her primary concern right now. She needs a ballpark figure by tomorrow. You decide to use_.

A. analogous estimating techniques

B. bottom-up estimating techniques

C. parametric estimating techniques

D. three-point estimating techniques

15. You have eight key stakeholders to communicate with on your project. Which of the following is true?

A. There are 36 channels of communication, and this should be a consideration when using the communications technology tool and technique.

B. There are 28 channels of communication, and this should be a consideration when using the communications requirements analysis tool and technique.

C. There are 28 channels of communication, and this should be a consideration when using the communications technology tool and technique.

D. There are 36 channels of communication, and this should be a consideration when using the communications requirements analysis tool and technique.

16. All of the following are true regarding Plan Communications except for which one?

A. The communications management plan is a subsidiary plan of the project management plan.

B. This process should be completed as early in the project as possible.

C. It's tightly linked with enterprise environmental factors and all organization process assets are used as inputs for this process.

D. Communications requirements analysis, communication technology, communication methods, and expert judgment are tools and techniques of this process.

17. You are preparing your communications management plan and know that all of the following are true except for which one? (Choose the least correct response.)

A. Encode means to translate thoughts or ideas so they can be understood by others.

B. The medium is how the message will be conveyed.

C. Acknowledgment means the receiver has received and agrees with the message.

D. Encoding and decoding are the responsibility of both the sender and receiver.

18. This ensures that information is distributed but does not acknowledge or certify that it was understood by intended receiver(s).

A. Push communication

B. Interactive communication

C. Medium

D. Message and feedback message

19. You need to communicate information in a multidirectional fashion with several stakeholders. Which of the following is true?

A. This describes push communication, which is a communication model.

B. This describes interactive communication, which is a communication method.

C. This describes communication requirements analysis, which is a communication model.

D. This describes pull communication, which is a communication method.

20. Communication technology takes into account all of the following factors that can affect the project except for which one?

A. Urgency of the need for information

B. Project environment

C. Reasons for the distribution of information

D. Duration of the project

Project Management Made Easy

Project Management Made Easy

What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.

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