MGT 172 CH5

46. Given that a project closely follows past projects in features and costs, the ________ method of assigns costs and times to particular phases that a project will go through. ________________________________________

apportion

54. Project costs such as labor and materials are typically classified as ________ costs. ________________________________________

direct

58. Costs that are not directly related to a specific project, such as advertising, accounting, and senior management, are classified as ____________.

general and administrative overhead cost

48. The ________ method of estimating project time and costs is useful for projects requiring the same task, group of tasks, or product repeated several times, especially if it is labor intensive. ________________________________________

learning curve

31. Which of the follow top-down methods is used when projects closely follow past projects in features and costs and result in costs being assigned by percentages to major segments of the project? A. Apportion B. Function point C. Phase estimating D. Learning curve E. Consensus

A. Apportion

10. Top-down estimates are most likely to occur during the ______ phase. A. Concept B. Planning C. Execution D. Delivery E. All of these are equally likely

A. Concept

33. People working on prototype development needing time to interact with the design engineers after the design is completed is an example of: A. Hidden interaction costs B. Things going wrong on a project C. Normal conditions not applying D. Changes in project scope E. None of these are correct

A. Hidden interaction costs

29. In a learning curve, the improvement ratio is applied to which of the following items? A. Direct materials B. Direct labor C. Overhead D. Both A and B are correct E. A, B, and C are all correct

B. Direct labor

16. Learning curves are more likely to apply in situations where most of the costs are A. Materials B. Labor C. Overhead D. Evenly spread over materials, labor, and overhead E. All of these are equally likely situations for learning curves

B. Labor

6. Ed is looking over the actual results of projects and comparing them to what was estimated. He notices that projects that took six months or longer to complete were noticeably more off the estimates. Which of the following factors is he recognizing? A. Padding estimates B. Planning horizon C. Project structure D. People E. Organization culture

B. Planning horizon

24. Project costs are typically viewed from all of the following except: A. Scheduled B. Sunk C. Actual D. Committed E. All of these are correct

B. Sunk

30. The bottom-up approach for estimating times and costs that uses costs from past projects that were similar to the current project is known as: A. Detailed WBS work package estimates B. Template method C. Function point method D. Time-phased cost estimates E. Phase estimating

B. Template method

35. Design flaws being revealed after the fact, extreme weather conditions, and accidents occurring are examples of: A. Hidden interaction costs B. Things going wrong on a project C. Normal conditions not applying D. Changes in project scope E. None of these are correct

B. Things going wrong on a project

3. A typical statement in actual practice is that estimates should have a probability of being met ______ of the time. A. 100% B. 98% C. 95% D. 90% E. 80%

C. 95%

22. The cost to prepare bottom-up estimates will typically run how much more than the costs to prepare the top-down estimates? A. About the same B. About twice as much C. About three times as much D. About four times as much E. About five times as much

C. About three times as much

1. The process of forecasting or approximating the time and cost of completing project deliverables is called A. Budgeting B. Predicting C. Estimating D. Planning E. Guesstimating

C. Estimating

9. Which of the following is a good condition for bottom-up estimating? A. Strategic decision making B. Internal, small project C. Fixed price contract D. High uncertainty E. Both C and D are good conditions for bottom-up estimating

C. Fixed price contract

17. Which of the following is not one of the bottom-up approaches to estimating project time and cost? A. Parametric procedures applied to specific tasks B. Estimates for the WBS work packages C. Learning curve D. Template method E. All of these are bottom-up approaches

C. Learning curve

20. The accuracy of top-down estimates will typically be in the range of A. Minus 50% to plus 50% B. Minus 0% to plus 75% C. Minus 20% to plus 60% D. Minus 35% to plus 35% E. Minus 10% to plus 30%

C. Minus 20% to plus 60%

11. ______ estimates are most likely to use low cost, efficient methods. A. Apportion B. Ratio C. Top-down D. Bottom-up E. All of these are equally likely

D. Bottom-up

28. Reasons why estimating time and cost are important include all of the following except: A. To schedule work B. To determine how long the project should take and cost C. To develop cash flow needs D. To determine how well the project is progressing E. All of the above are valid reasons

E. All of the above are valid reasons

21. The accuracy of bottom-up estimates will typically be in the range of A. Minus 50% to plus 50% B. Minus 0% to plus 75% C. Minus 20% to plus 60% D. Minus 35% to plus 35% E. Minus 10% to plus 30%

E. Minus 10% to plus 30%

12. Which of the following methods is not considered a top-down approach to estimating project time and cost? A. Ratio B. Template C. Apportion D. Function point E. Learning curve

B. Template

36. Estimates that are typically based on estimates of elements found in the work breakdown structure are called ________ estimates. ________________________________________

bottom up

43. Using the ________ method of forecasting project time and costs is the preferred method for situations where the cost and time estimates are important, in a fixed contract situation, and when the customer wants a lot of detail. ________________________________________

bottom up

50. Probably the most reliable method for estimating time and cost is to use the _______ and to ask the people responsible for the work package to make the estimates. ________________________________________

bottom up

32. Resource shortages, in the form of people, equipment, or materials, is a good example of A. Hidden interaction costs B. Things going wrong on a project C. Normal conditions not applying D. Changes in project scope E. None of these are correct

C. Normal conditions not applying

34. A manager getting further into a project and obtaining a better understanding of what needs to be done to accomplish a project is an example of: A. Hidden interaction costs B. Things going wrong on a project C. Normal conditions not applying D. Changes in project scope E. None of these are correct

D. Changes in project scope

27. Companies like Boeing, Kodak, and IBM are using which of the following for improving the estimating process? A. Adjusting estimates based on individual forecasting abilities B. Benchmarking using the experience of other companies C. Using time and motion studies D. Creating historical databases of previous projects E. All of these are correct

D. Creating historical databases of previous projects

26. Which of the following is not one of the recommended guidelines for developing useful work package estimates? A. Estimates should be made by those responsible for the work B. Use several people to estimate the same work C. Estimates should be based on normal conditions D. Estimates should include a normal level of contingency E. Estimates should be independent of other projects

D. Estimates should include a normal level of contingency

57. The __________ method is a top-down approach that uses the pooled experience of senior and/or middle managers to estimate the total project duration and cost. ________________________________________

consensus

55. The salary of the project manager and temporary rental space for the project team would be classified as ________ costs. ________________________________________

direct overhead

14. Sean is forecasting the time and cost of developing a customized software program by looking at the number of inputs, outputs, inquires, files, and interfaces. Which of the following methods is he using? A. Ratio B. Template C. Apportion D. Function point E. Learning curve

D. Function point

8. Which of the following is a good condition for top-down estimating? A. Cost and time important B. Fixed price contract C. Customer wants details D. Internal, small project E. All of these are good conditions for top-down estimating

D. Internal, small project

18. The approach that begins with a top-down estimate for the project and then refines estimates as the project is implemented is known as ______ method. A. Function point B. Template C. Learning curve D. Phase estimating E. Apportion

D. Phase estimating

19. Which of the following would be the best method for projects where the final product is not known and the uncertainty is very large? A. Function point B. Template C. Learning curve D. Phase estimating E. Apportion

D. Phase estimating

5. Which of the following is not one of the factors that need to be considered to improve quality of estimates for project times and costs? A. Planning horizon B. People C. Padding estimates D. Profit E. Project structure

D. Profit

25. Which of the following would be considered a direct project cost? A. Labor B. Materials C. Equipment D. Both A and B are direct costs E. A, B, and C are all considered direct costs

E. A, B, and C are all considered direct costs

23. Typical kinds of costs found in a project include A. Direct costs B. Project overhead costs C. General and administrative costs D. Only A and B are included E. A, B, and C are all included

E. A, B, and C are all included

15. Laura is forecasting the time and cost of developing an intranet for a new customer. Her department has completed six such intranets for customers during the last two years. Although the proposed system is about the same size as the others she estimates that it will take about 10 percent less time and money. Which of the following methods is she using? A. Ratio B. Template C. Apportion D. Function point E. Learning curve

E. Learning curve

47. The ________ method for estimating project time and cost uses weighted variables based on major parameters and is frequently used in the development of software. ________________________________________

function point

56. Estimates should be made based on ________ conditions, efficient methods, and a normal level of resources. ________________________________________

normal

52. The cost to prepare a top-down budget will typically run ________ percent of the total project cost. ________________________________________

one-teeth to three tenth

41. The prevailing belief in some firms that detailed estimating takes too much time and is not worth the effort or that it is impossible to predict the future is an example of the ________ factor. ________________________________________

organization culture

40. The tendency to over-estimate project time and cost in order to improve the likelihood of meeting the estimates is known as the ________ factor. ________________________________________

padding estimates

51. The ________ approach to estimating project time and cost begins with an overall estimate for the project and then refines estimates for various stages of the project as it is implemented. ________________________________________

phase estimating

38. The estimating factor known as ________ considers the decreasing accuracy of estimates as one forecasts activities that are further into the future. ________________________________________

planning horizon

45. In the ________ method of top-down estimating, a quantitative relationship is established between the estimates and a project parameter. ________________________________________

ratio

49. In the ________ method of estimating project time and costs past projects are used as a starting point with adjustments made based on differences in the new project. ________________________________________

template

7. Janet is forecasting how much money her department needs to support a new project. She estimates that two people and $25,000 in expenses will cover her needs. Because management typically insists on reducing forecasts by 20 percent, she increases her estimates to allow for that reduction. Which of the following factors is illustrated in this situation? A. Padding estimates B. Planning horizon C. Project structure D. People E. Organization culture

A. Padding estimates

4. A good starting point for developing time and cost estimates is A. Past experience B. Work packages C. Task analysis D. Time and motion studies E. Work breakdown structure

A. Past experience

13. Jose is forecasting project time and cost for constructing a new building by multiplying the total square footage by a given dollar amount. Which of the following methods is he using? A. Ratio B. Template C. Apportion D. Function point E. Learning curve

A. Ratio

2. In practice, estimating processes are frequently classified as A. Top down/bottom up B. Rough/polished C. Precise/order of magnitude D. Draft/final E. Both A and B are correct

A. Top down/bottom up

53. The cost to prepare a bottom-up budget will typically run ________ percent of the total project cost. ________________________________________

three tenths to one

37. Estimates that are usually derived from analogy or mathematical relationships are called ________ estimates. ________________________________________

top down

42. Using the _______ method of forecasting project time and costs is the preferred method for situations involving strategic decision-making, projects with a high degree of uncertainty, and projects with an unstable scope. ________________________________________

top down

44. The information necessary to conduct a bottom-up estimate of project time and costs starts with the ________. _______________________________________

work package

39. The ________ factor in estimating project times and costs can introduce errors due to staff turnover, the skills of the participants, and whether the team members have worked with each other on previous projects. ________________________________________

people