Project Cost Management

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Here is a list of sample questions which would help you to understand the pattern of questions on Project Cost Management being asked in PMP Certification Exams.

You can check our complete set of PMP Mock Exams:


(1) Which type of project cost estimate is the most accurate?

  1. Preliminary

  2. Definitive

  3. Order of magnitude

  4. Conceptual

Answer:B

(2) Which of the following type of contracts is most preferable to the contractor doing the project work?

  1. Cost plus fixed fee

  2. Fixed price

  3. Fixed price plus incentive free

  4. B and C

Answer: A

(3) To assist in budget control, it is suggested that the estimate occur at the _____ ____ ______ level of the WBS

  1. Highest

  2. Lowest

  3. Major work effort

  4. Third

Answer: B

(4) Cost Variance (CV) is which of the following equations?

  1. CV = BCWP - BCWS

  2. CV = BCWP - ACWP

  3. CV = SV / BCWS

  4. A and c

Answer:B

(5) Cost budgeting can be best described by which of the following?

  1. The process of developing the future trends along with the assessment of probabilities, uncertainties, and inflation that could occur during the project

  2. The process of assembling and predicting costs of a project over its life cycle

  3. The process of establishing budgets, standards, and a monitoring system by which the investment cost of the project can be measured and managed

  4. The process of gathering, accumulating, analyzing, reporting, and managing the costs on an on-going basis

Answer:C

(6) Which of the following is a direct project cost?

  1. Lighting and heating for the corporate office

  2. Workers Compensation insurance

  3. Piping for an irrigation project

  4. A and B

Answer: C

(7) Cost controls can be best described by which of the following?

  1. The process of developing the future trends along with the assessment of probabilities, uncertainties, and inflation that could occur during the project

  2. The process of assembling and predicting costs of a project over its life cycle

  3. The process of assembling and predicting costs of a project over its life cycle

  4. The process of gathering, accumulating, analyzing, reporting, and managing the costs on an on-going basis.

Answer: D

(8) The BCWS = $250, the ACWP = $350, and the BCWP = $200. Calculate the Cost Variance.

  1. -$150

  2. $150

  3. -$50

  4. $50

Answer: A

(9) One of the types of cost estimation is Order of Magnitude. This estimate:

  1. is performed when detailed information is available

  2. is performed when detailed information is available

  3. is used in the beginning of the project conceptualization

  4. Uses mostly information from past projects

  5. Usually made before the project is designed, and must therefore rely on the cost data of similar projects built in the past.

Answer: E

(10) Life Cycle Costing is a term that is:

  1. used when making decisions between alternatives

  2. employed principally by the government

  3. typically used in the construction industry

  4. not used within the government

  5. A and B

Answer: E



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