9. PMP_Cost

The BEST description of costs that change with the amount of production is:

• Variable costs

• Direct costs

• Fixed costs

• Sunk costs

A project manager is finalizing a project that has had repeated problems with cost conformance. He is concerned about what management will say. Which of the following types of information would be BEST for the project manager to use to evaluate performance?

• The CPI

• A list of complaints from senior management

• The project budget

• The last bar chart

One common way to compute estimate at completion (EAC) is to take the budget at completion (BAC) and:

• Multiply by CPI

• Divide by SPI

• Divide by cumulative CPI

• Multiply by SPI

You are in the middle of a new product development project for your publicly traded company when you discover the previous project manager made a $3,000,000 payment that was not approved in accordance with you company policies. Luckily, the project CPI is 1.2. What should you do?

• Contact your manager

• Ignore the payment

• Put the payment in an escrow account

• Bury the cost in the largest cost center available

The main focus of life cycle costing is to:

• Consider installation costs when planning the project costs

• Consider operations and maintenance costs in making project decisions

• Estimate installation costs

• Estimate the cost of operations and maintenance

A project manager has run into cost difficulties. The project scope must be completed, but at less cost. The project manager should:

• Evaluate benefit cost ratios

• Recover some sunk cost

• Perform a value analysis

• Change the depreciation method for the equipment used on the project

Which of the following BEST describes the meaning of the 50/50 rule?

• Grant 50% progress on an activity when it begins and 50% upon completion

• Identify 50% of risks before you start to develop responses

• 50% of the work is done by 50% of the people on the project

• The project is given credit for completing 50% of the work when it finished

TCPI is represented by which of the following?

• (BAC - EV)/(BAC - AC)

• AC + (BAC - EV)

• A measure of the value of work completed compared to the actual cost or progress

• A measure of progress achieved compared to progress planned

Calculating ETC is done in:

• Project initiating

• Project monitoring and controlling

• Project planning

• Project executing

A SPI of 0.76 means:

• You are ahead of schedule

• You are progressing at 76% of the rate originally planned

• You are progressing at 24% of the rate originally planned

• You are over budget