ch 7

ballpark

A rough order of magnitude estimate can be referred to as a _____ estimate.

*revenues minus expenditures

Profits may be defined as:

**the earned value minus the planned value.

Schedule variance is:

Electricity used to run its factories

Soles is a footwear company which has recently set up its store in Ambrosia. To manufacture its products, Soles incurs a range of different costs. Which of the following would be an example of an indirect cost?

can be used to estimate the projected cost of completing the project.

The cost performance index (CPI):

to plan how costs will be managed.

The first step in project cost management is:

cost budgeting

The main goal of the _____ process is to produce a cost baseline for measuring project performance and project funding requirements.

**managing changes to the project budget.

The process of controlling costs primarily involves:

*Estimating costs

Which of the following involves developing an approximation of the costs of resources needed to complete a project?

Work performance data

Which of the following is an input of the process of controlling costs?

*Cost forecasts

Which of the following is an output of the process of controlling costs?

*People lack estimating experience.

Which of the following is most likely to be a reason for inaccuracies in information technology cost estimates?

They are time-intensive and expensive to develop.

Which of the following is true of bottom-up estimates?

*It is an estimate of the value of the physical work actually completed.

Which of the following is true of earned value?

*They can be easily measured.

Which of the following is true of tangible costs?

cost control

Work performance information and cost forecasts are main outputs of the _____ process.

Intangible costs

_____ are those costs that are difficult to measure in monetary terms.

*Life cycle costing

_____ helps develop an accurate projection of a project's financial expenses and benefits.

Project cost management

_____ includes the processes required to ensure that a project team completes a project within an approved budget.

**Cash flow analysis

_____ is a method for determining the estimated annual costs and benefits for a project.

*Definitive

A _____ estimate is used for making many purchasing decisions for which accurate estimates are required and for estimating final project costs.

**bottom-up

A cost estimation tool which involves estimating individual work items or activities and summing them to get a project total is known as a(n) _____ estimate.

top-down

Analogous estimates are also known as _____ estimates.

Definitive

If the cost estimate for a project is a basis for contract awards and performance reporting, it should be a(n) _____ estimate and as accurate as possible.

Not directly related to the products or services of a project.

Indirect costs are:

Direct costs

Newtech Inc. hires John for the position of a software programmer to work on their new project. Salary paid to John by Newtech Inc. would be an example of _____ costs.

Parametric estimating

_____ uses project characteristics in a mathematical model to estimate project costs.