Tag: Project Management Professional (PMP) Exam Practice

Project Management Professional (PMP) Exam Practice – Question1432

There are a number of different earned value management rules of performance measurement that can be established as part of the cost management plan. Which one of the following is NOT an example of such a rule?


A. Code of accounts allocation provision
B. Formulas to determine the ETC
C. Earned value credit criteria
D. Definition of the WBS level

Correct Answer: A

Explanation:

Explanation:
Rules of earned value performance measurement are part of the cost management plan and may (1) define the points in the WBS where measurement of control accounts will be performed; (2) establish the EV measurement techniques such as weighted
milestones, fixed-formula, percent complete, etc., to be used; and (3) specific tracking methods and EV equations for calculating the EAC forecasts to provide a validity check on the bottom-up EAC.

Project Management Professional (PMP) Exam Practice – Question1431

Your project manager has requested that you provide him with a forecast of project costs for the next 12 months. He needs this information to determine if the budget should be increased or decreased on this major construction project. In addition to the usual
information sources, which of the following should you also consider?


A. Cost estimates from similar projects
B. WBS
C. Project schedule
D. Costs that have been authorized and incurred

Correct Answer: D

Explanation:

Explanation:
These costs are part of work performance data about project progress. In addition data include information about project progress such as which activities have started, their progress, and which deliverables have finished Updating the budget requires knowledge
about the actual costs spent to date, and any budget changes are approved according to the Perform Integrated Change Control process.

Project Management Professional (PMP) Exam Practice – Question1430

It is expensive to lease office space in cities around the world. Office space can cost approximately USD $80 per square foot in Tampa, Florida. And it can cost approximately $50,000 per square meter in Tokyo. These "averages" can help a person to determine
how much it will cost to lease office space in these cities based on the amount of space leased. These estimates are examples of______________


A. Variance analysis
B. Parametric estimating
C. Bottom-up estimating
D. Reserve analysis

Correct Answer: B

Explanation:

Explanation:
Parametric estimating involves using statistical relationships between historical data and other variables to calculate or estimate for activity parameters, such as cost, budget, or duration. The example is representative of a simple parametric model.

Project Management Professional (PMP) Exam Practice – Question1429

The undistributed budget is part of the______________


A. Management reserve
B. Performance measurement baseline
C. Level-of-effort cost accounts
D. General and administrative accounts

Correct Answer: B

Explanation:

Explanation:
The undistributed budget is applied to project work that has not yet been linked to WBS elements at or below the lowest level of reporting. It is, therefore, part of the performance measurement baseline and is expected to be used in the performance of project
work.

Project Management Professional (PMP) Exam Practice – Question1428

The cumulative CPI has been shown to be relatively stable after what percentage of project completion?


A. 5% to 10%
B. 15% to 20%
C. 25% to 35%
D. 50% to 75%

Correct Answer: B

Explanation:

Explanation:
The CPI has been proven to be an accurate and reliable forecasting tool. Researchers have found that the cumulative CPI does not change by more than 10% once a project is approximately 20% complete. The CPI provides a quick statistical forecast of final
project costs.

Project Management Professional (PMP) Exam Practice – Question1427

Which of the following is a tool for analyzing a design, determining its functions, and assessing how to provide those functions' cost effectively?


A. Pareto diagram
B. Value analysis
C. Configuration management
D. Value engineering

Correct Answer: D

Explanation:

Explanation:
Value engineering considers possible cost trade-offs as a design evolves. The technique entails identifying the functions that are needed and analyzing the cost effectiveness of the alternatives available for providing them. It helps optimize project life cycle costs,
save time, increase profits, improve quality, increase market share, solve problems, and contribute toward more effective resource use.

Project Management Professional (PMP) Exam Practice – Question1426

Your approved cost baseline has changed because of a major scope change on your project.
Your next step should be to______________


A. Estimate the magnitude of the scope change
B. Issue a change request
C. Document lessons learned
D. Execute the approved scope change

Correct Answer: B

Explanation:

Explanation:
Before a revised cost baseline leading to a budget update can be prepared, it is necessary to issue a change request, which may include preventive or corrective action. These change requests then are reviewed and processed through the Perform Integrated
Change Control process.

Project Management Professional (PMP) Exam Practice – Question1425

You receive a frantic phone call from your vice president who says she is going to meet with a prospective client in 15 minutes to discuss a large and complex project. She asks you how much the project will cost. You quickly think of some similar past projects,
factor in a few unknowns, and give her a number. What type of estimate did you just provide?


A. Definitive
B. Budget
C. Order-of-magnitude
D. Detailed

Correct Answer: C

Explanation:

Explanation:
An order-of-magnitude estimate, which is referred to also as a ballpark estimate, has an accuracy range of -25% to 75% and is made without detailed data.

Project Management Professional (PMP) Exam Practice – Question1424

If you want to calculate the ETC based on your expectations that similar variances to those noted to date will not occur, you should use which of the following formulas?


A. ETC =BAC -EV
B. ETC = (BAC -EV)/CPI
C. ETC =AC +EAC
D. ETC =AC +BAC -EV

Correct Answer: A

Explanation:

Explanation:
This formula assumes that the estimate to complete is based on the same cost efficiency level.

Project Management Professional (PMP) Exam Practice – Question1423

You have a number of costs to track and manage because your project is technically very complex. They include direct costs and indirect (overhead) costs. You have found that managing overhead costs is particularly difficult because they______________


A. Are handled on a project-by-project basis
B. Represent only direct labor costs

C. Represent only equipment and materials needed for the project
D. Are usually beyond the project manager's control

Correct Answer: D

Explanation:

Explanation:
Overhead includes costs such as rent, insurance, or heating, that pertain to the project as a whole and cannot be attributed to a particular work item. The amount of overhead to be added to the project is frequently decided by the performing organization and is
beyond the control of the project manager.