Project Management 7

Project Cost Management includes all of the following processes EXCEPT:

• Plan cost management.

• Level resources.

• Determine budget.

• Control costs

The cost management plan has all of the following characteristics EXCEPT:

• It is based on project cost estimates and is separate from the project management plan.

• It may specify variance thresholds for monitoring cost performance to indicate an agreed- upon amount of variation to be allowed before some action needs to be taken.

• It may specify the level of precision, which is the degree to which activity cost estimates will be rounded up or down.

• It describes how the project costs will be planned, structured, and controlled.

All of the following are true about cost estimates EXCEPT:

• A. Cost estimates are generally expressed in units of some currency (i.e., dollars, euros, yen, etc.), although in some instances other units of measure, such as staff hours or staff days, are used to facilitate comparisons by eliminating the effects of currency fluctuations.

• B. Costs are estimated for all resources that will be charged to the project.

• C. Information in the risk register should not be considered in cost estimates, because risks can be either threats or opportunities and their impacts tend to balance out.

• D.A cost estimate is a quantitative assessment of the likely costs for resources required to complete the activity. Cost estimates may be presented at the activity level or in summary form

An activity cost estimate includes all of the following resource categories EXCEPT:

• Labor.

• Materials.

• Equipment.

• Time shortages.

Parametric estimating involves:

• Defining cost or duration parameters of the project life cycle.

• Calculating individual cost estimates for each work package and integrating them to obtain the total cost of the project.

• Using a statistical relationship between relevant historical data and other variables to calculate a cost estimate for project work.

• Using the actual cost of a previous similar project to estimate the cost of the current project

Analogous cost estimating:

• Integrates bottom-up estimating techniques with relevant statistical relationships to estimate the cost of the current project.

• Relies on the actual cost of previous, similar projects as the basis for estimating the cost of the current project.

• Is used most frequently in the later phases of a project.

• Summarizes estimates for individual work packages to estimate the cost of the current project.

Which of the following represents processes concerned with establishing and controlling the cost baseline?

• Plan Resource Management and Control Costs.

• Estimate Costs, Develop Budget, and Adhere to Baseline.

• Determine Budget and Control Costs.

• Plan Resource Management, Cost Estimating, and Cost Control

The cost performance baseline has all of the following characteristics EXCEPT:

• It is the approved version of the time-phased project budget, excluding any management reserves, and is used as a basis for comparison with actual results.

• It shows the actual cost expenditures throughout the project life cycle.

• It is developed as a summation of the approved budgets for the different schedule activities.

• It is typically displayed in the form of an S-curve.

Project cost control includes all of the following EXCEPT:

• Informing appropriate stakeholders of all approved changes and associated costs.

• Monitoring cost performance to isolate and understand variances from the approved cost baseline.

• Influencing the factors that create changes to the authorized cost baseline.

• Allocating the overall estimates to individual work packages to establish a cost baseline.

You have been promoted to the position of project manager for a large project, due to the abrupt transfer of the previous project manager. On the first day in your new, exciting position, you find a folder on your desk entitled: Earned Value Management. In that folder, you find only the following chart related to your project with the Data Date of a few days ago:

• Based on this chart, you conclude that:

  The project is below budget and probably ahead of schedule.

• The project is over budget and probably behind schedule.

• The project is below budget but probably behind schedule.

• The performance on this project compared to budget and schedule cannot be determined because this chart does not show any values.