Planning and Managing the Project Budget

Your project experienced a one-time risk event that cost $50,000. Aside from this event, your project performance is right on track with a budget at completion of $1,000,000.What is your EAC?

$1,050,000

Your project has a CPI of 0.92 and you expect the rate of spending to continue.If your original budget was $1 million, what is your new estimate at completion (EAC)?

$1,086,957

Your project has a $1 million budget and a one-year time frame. After six months, you have completed 60% of the work and spent $700,000.What is the cost variance assuming uniform load of the work plan?

-100,000

You're calculating a project's TCPI. The EV is $27,000, AC is $25,000, and BAC is $32,000. As the BAC is no longer realistic, you forecast a new EAC of $35,000.What is the TCPI based on the new EAC?

.50

You have an earned value of $750,000 and an actual cost of $700,000.What is the cost performance index?

1.07

Your project has a $1 million budget and a one-year time frame. After three months, you have completed 20% of the work.What is the earned value assuming uniform load of the work plan?

200000

Leverages guidance and assistance from experienced people internal or external to the organization to estimate costs

A:Expert judgment

EAC = AC + bottom-up ETC

A:Forecasting using an estimate to complete

BAC x planned % complete

A:PV

How do you use the bottom-up technique to estimate project costs?

Add the costs of labor and materials, any contingency reserves, and the cost of quality, and then roll up the estimated costs through to the highest level in the WBS

BAC x actual % complete

B:EV

EAC = AC + BAC - EV

B:Forecasting by considering that variances are not expected to occur for the remainder of the project

Calculates costs using optimistic, most likely, and pessimistic estimates

B:Three-point estimating

Why would a project team decide to use a bottom-up estimate at completion?

Because the original budget at completion was flawed

EV - AC

C:CV

Allows finalization of draft cost estimates

C:Decision making

EAC = BAC / cumulative CPI

C:Forecasting by considering the project's cost efficiency

EV / AC

D:CPI

EAC = AC + [(BAC - EV) / (cumulative CPI × cumulative SPI)]

D:Forecasting by considering the project's cost and schedule efficiency

Uses computerized spreadsheets and statistical packages to estimate costs

D:Project management information system

Which tools and techniques can you use to determine your project budget?

Data analysis Expert judgment Historical information review Financing Cost aggregation Funding limit reconciliation Reserve analysis

Which tools and techniques are involved in controlling costs?

Data analysis MEETINGS To-complete performance index Decision making Expert judgment Project Management Information System

Evaluates all identified options and picks the optimum one

E:Alternatives analysis

Your project has an SPI of 0.9 and a CPI of 1.0.What is the best action you can take to address project performance?

Perform two sequenced activities on the critical path simultaneously

Your project has an SPI of 1.2 and a CPI of 0.8.What is the best action you can take to address project performance?

Remove some resources from noncritical activities to reduce the cost

Your project has an SPI of 1.2 and a CPI of 0.8.What does this indicate about your project performance?

The project is ahead of schedule and over budget

Your project has an SPI of 0.9 and a CPI of 1.0.What does this indicate about your project performance?

The project is behind schedule and on budget

Your EAC formula includes the SPI.What can you assume this means?

Your deadline is firm