pmp exam preparation workshop - amazon s3f2015_s_cost.pdf · 2016-04-15 · the rate of return that...

11

Chapter 7Project Cost Management

PMP Exam PreparationWorkshop

Copyright © 2015 PMI SOC

22Copyright © 2015 PMI SOC

Learning Objectives

By the end of this session, you should understand:

• Importance of cost management for the success of a project

• Cost management processes as described in PMBOK Guide – Fifth Edition

• How to approach PMP Exam questions on cost management


Agenda

• Cost Management Overview

• Cost Management Processes:

1. Plan Cost Management

2. Estimate Costs

3. Determine Budget

4. Control Costs

• Sample Exam Questions


Project Cost Management:

•Involves planning, estimating, budgeting, financing, funding, managing, and controlling costs.

•Facilitate project completion within the approved budget.

•Includes the following processes:1. Plan Cost Management

2. Estimate Costs

3. Determine Budget

4. Control Costs

•Predicts and analyzes financial performance of the project.

Introduction


Overview

PMBOK V5 Ref # Fig 7-1.


Plan Cost Management

PMBOK V5 Ref # Fig 7-2


Cost Management Plan:

• Element of the project management plan which

describes how the project costs will be planned,

structured and controlled

• May be formal or informal, highly detailed or broadly

framed, based upon the needs of the project



Project Management Plan Scope baseline Schedule baseline

Project Charter Summary budget Approval requirements

Enterprise Environmental Factors Organizational culture Market conditions, currency exchange rates Published commercial information

Organization Process Assets Financial controls procedures Historical information and lessons learned Financial databases, cost estimating and budgeting policies

Plan Cost Management - Inputs


Expert Judgment

Guided by historical information

Guided by expertise

Analytical Techniques

May involve strategic funding options

Meetings

Planning meetings with anyone with responsibility

for project costs

Plan Cost Management – Tools & Techniques


Cost Management Plan: Units of Measure

Level of Precision

Level of Accuracy

Organizational Procedures Links

Control Thresholds

Rules of Performance Measurement

Earned Value Management (EVM)

Reporting Formats

Process Descriptions

Additional Details

Plan Cost Management - Outputs


Estimate Costs



Determines the approximate monetary resources needed to complete project activities

Cost differs from price Cost: how much is spent to complete the product or service

Price: how much to charge for the product or service (i.e., a

business decision)

Cost estimates identify and investigate various alternatives, e.g.: Make vs buy

Buy vs lease

Estimate Costs


Cost estimates Generally expressed in units of currency

May be expressed in work hours or days

Includes all resources charged to the project, e.g.: Labour, materials, equipment, services, facilities

Accuracy of estimates Order of Magnitude(ROM) estimate: -25% to +75% Preliminary estimate: -15% to + 50% Budget estimate: -10% to +25% Definitive estimate: -5% to +10% Final estimate: 0%

Estimates are refined during the course of the project as additional detail becomes available

Estimate Costs


Direct Costs

Costs incurred directly by the project

Indirect Costs Costs allocated to the project by the organization

as a cost of doing business

Sunk Cost Costs already expended that cannot be recovered

and do not affect decision making

Opportunity Costs Benefits not realized as a result of choosing a

particular alternative

Estimate Costs


Fixed Costs Costs that do not vary with volume of activity

Variable Costs Costs that vary with project duration or volume of

activity

Marginal Costs Incremental cost of the last unit added (extra order)

Expense Cost deducted against income for the current year

Capital Costs Not an expense, depreciated over time

Estimate Costs


Life Cycle Costing An estimate of all costs associated with a system/item

over its useful life

Elements usually included in life cycle costs include: Initial acquisition costs Replacement costs Maintenance costs Operation costs Loan & interest costs Taxes & insurance Income produced

Estimate Costs


Scope Baseline

Project Schedule

Human Resource Plan

Risk Register

Enterprise Environmental Factors Market conditions

Published commercial information

Organizational Process Assets Cost estimating policies and templates

Historical information

Lessons learned

Estimate Costs - Inputs


Expert Judgment Guided by historical information Provides valuable insight about the environment and

experiences on similar projects

Analogous Estimating Uses actual costs from similar projects as the basis for

estimating the cost of the current project (top-down estimate)

Parametric Estimating Statistical estimate using the relationship between historical

data and other variables (e.g. $/square foot)

Bottom Up Estimating Detailed cost estimate derived from the lowest level in the

work breakdown structure

Estimate Costs – Tools & Techniques


Three-Point Estimates: Weighted average - factors in all potential cost outcomes: PERT: (Optimistic + 4 x Expected + Pessimistic) / 6 Triangular: (Optimistic + Expected + Pessimistic) / 3

Reserve Analysis Estimate of costs required to deal with uncertainty/risks

(contingency reserves) Can overstate the cost estimate, should NOT be used at the

schedule activity level

Cost of Quality All the costs associated with achieving quality standards (costs

to prevent non-conformance, appraising/inspecting product or service and in failing to meet requirements)

Estimate Costs – Tools & Techniques


Project Management Software Use of software to assist with cost estimating (spreadsheets,

simulation, statistical tools, etc.)

Vendor Bid Analysis Analysis of what the project should cost versus vendor bid Examines the price of individual deliverables to derive a cost

Supports the final total project cost

Group Decision Making Techniques Team based approach such as brainstorming or Delphi

technique Additional information is gained and can result in more

accurate estimates

Estimate Costs – Tools &Techniques


Activity Cost Estimates

Probable costs required to complete project work

Basis of Estimates Includes supporting detail for activity cost

estimates Varies by application area

Project Document Updates Typically risk register, but not limited to risk

register

Estimate Costs - Outputs


Determine Budget



Aggregate estimate cost of all work packages to

create the cost baseline

Used throughout the project to measure project

performance

Notes: Project Budget Maximum size of the budget is usually imposed

Approved estimate for the project (or any WBS component or

any schedule activity)

Cannot be modified without approval

Typically broken down into time periods and category

Determine Budget


Activity Cost Estimates

Basis of Estimates

Scope Baseline Scope statement Work Breakdown Structure WBS dictionary

Project Schedule

Resource Calendars

Contracts

Organizational Process Assets

Determine Budget - Inputs


Cost Aggregation Cost estimates are aggregated by WBS

Components Assign costs to each work package and/or activity Aggregate costs to higher component levels of

WBS (control accounts) Aggregate costs to get a total cost for the project

Reserve Analysis Establish contingency reserve

Determine Budget – Tools & Techniques


Expert Judgment

Historical Relationships

Parametric or analogous estimates

Funding Limit Reconciliation

Compares (reconciles) budgeted costs with the funding limits

Adjusts expenditures to smooth or regulate the expenses

Determine Budget – Tools & Techniques


Forecasting and Financial Analysis Part of initiating processes, used as project selection tool

Financial Forecasting

Used for decision making

Tools:

Return on Investment (ROI): o Ratio of annual net profits to capital investment

Payback Analysiso Time required for accumulated cash flows to equal

zero

Net Present Value (NPV)

Internal Rate of Return (IRR)

Determine Budget – Additional Techniques


Return on Investment (ROI)

Determine Budget

Measures financial change (whether positive or negative) that would result from pursuing a given project.

Inflows and outflows evaluated relative to other investment opportunities – in terms of:

• Financial Benefits• Revenue – introduction of/increases to revenue streams• Cost savings – reductions in financial obligations• Cost avoidance - averting unfavourable costs - e.g. fines, overhead increases• Cost protection – controlling existing costs.

• Investment Costs • Costs associated with executing the project• New “steady state” expenditures introduced by the project – e.g. maintenance

obligations, headcount increases• Loss of revenue – e.g. erosion of market share for firm’s other products


Payback Analysis

Simple method

Calculation of the number of years to pay back the initial investment Ignores the time value of money

Ignores expected cash flows beyond the payback period

Choose the project with the shortest payback period

By interpolation, payback time

is approximately 2.4 years

Year Cashflow CumulativeCash flow

0 -1000 -1000

1 475 -525

2 400 -125

3 330 205

4 270 475

5 200 675

Determine Budget


Present ValueDetermine Budget

Is a form of Discounted Cash Flow

Represents: – current value of a future some of money, given a specified rate of

return

Useful in comparing project investments: – by assessing the amount that would need to be invested today, in

order to receive x amount at x time in the future

For example:

– For a $100,000 investment, Project A will yield $300,000 - tripling the investment in 5 years, whereas Project B will yield $400,000 – quadrupling the investment in 7 years. All other things being equal, which is the better investment?


Present ValueDetermine Budget

Present Value Formula is PV = FV / (1 + r)Y.

To determine which project will yield a higher return, we solve for r as r = (FV / PV)1 / Y - 1

Project A will yield a higher return, and is the better investment:

– Project A Project A’s r = (300,000 / 100,000 ) 1 / Y - 1 Project A’s r = (3) 1 / 5 – 1 = (3) 0.2 - 1 Project A’s r = 1.2457 – 1 = 0.2457 or 24.57%

– Project B Project B’s r = (400,000 / 100,000 ) 1 / Y - 1 Project B’s r = (4) 1 / 7 – 1 = (4) 0.14287 - 1 Project B’s r = 1.2190 – 1 = 0.2190 or 21.90%


Net Present Value (NPV)

Also called Discounted Cash Flow The difference between:

Present value of the benefits Present value of the costs

The benefit and cost cash flows are discounted by the required rate of return (also known as the hurdle rate) Positive result is favorable Negative result is undesirable

Determine Budget

Choose the project alternative with the highest net present value

GO No GO


Internal Rate of Return (IRR)

The rate of return that makes NPV = 0 Equates Present Value of expected benefit to Present Value of

expected costs Value is found by trial and error, spreadsheet function, etc. IRR > Cost of Capital is acceptable, IRR < Cost of Capital is unacceptable

When comparing investment opportunities, choose highest IRR that is above the Cost of Capital

Determine Budget

• IRR will be between 20% and 25% for NPV to be 0

• IRR found to be 23.928%


Depreciation

The process of allocating the cost of an asset to the periods of benefit

Four step process: Determine value of asset Estimate expected useful life (# of years) Estimate salvage value (at the end of its expected useful life) Evaluate the dollar value of the asset expected to be used up

per year:1. Straight-line depreciation (SLD)2. Sum of the years digits (SYD)3. Double declining balance (DDB)4. Units of production

Determine Budget


Straight Line Depreciation

Determine Budget

Reduce value of asset by an identical amount per

period, over its expected useful life.

Account for Residual Value - subtract the Residual

Value from Original Cost, before determining the

amount to be deducted per period.

Derived as: (Original Cost – Residual Value) / Useful Life

For example: – the following calculations show depreciation for a $500,000

asset with and without a residual value.


Straight Line Depreciation

Determine Budget

• In this case, depreciation stops at the expected residual value of the asset

Straight-Line Depreciation Straight-Line Depreciation (w/ salvage value)

Original cost $ 500,000 Original cost $ 500,000

Residual value $ - Residual value $ 100,000

Net cost $ 500,000 Net cost $ 400,000

Life 5 Life 5

Depreciation per year $ 100,000 Depreciation per year $ 80,000

Straight-Line Depreciation Straight-Line Depreciation

Beginning Depreciation Ending Beginning Depreciation Ending

Year NBV for Year NBV Year NBV for Year NBV

1 $ 500,000 $ 100,000 $ 400,000 1 $ 500,000 $ 80,000 $ 420,000

2 $ 400,000 $ 100,000 $ 300,000 2 $ 420,000 $ 80,000 $ 340,000

3 $ 300,000 $ 100,000 $ 200,000 3 $ 340,000 $ 80,000 $ 260,000

4 $ 200,000 $ 100,000 $ 100,000 4 $ 260,000 $ 80,000 $ 180,000

5 $ 100,000 $ 100,000 $ - 5 $ 180,000 $ 80,000 $ 100,000

$ 500,000 $ 400,000


Sum of the Years Digits

Type of accelerated depreciation

Three step process:

1. Sum the digits of the number of years over which the asset is to be depreciated

2. Establish the depreciation factors• Numerator = reverse order of the years• Denominator = sum of the years digits (step 1)

3. Calculate each year’s depreciation expense by multiplying the appropriate depreciation factor by the original cost of the asset

Determine Budget


Cost of Fixed Asset = $8,000 Salvage Value = $0 Expected Useful Life = 5 years Sum of the Years = (1+2+3+4+5) = 15

Determine BudgetSum of the Years Digits

Year Depreciation Factor Asset Cost Annual

Depreciation

1 5/15 $8,000 $2,667

2 4/15 $8,000 $2,133

3 3/15 $8,000 $1,600

4 2/15 $8,000 $1,067

5 1/15 $8,000 $533


Double Declining Depreciation

Type of accelerated depreciation

Depreciation rate is up to double the straight line depreciation rate

Depreciation rate is applied to the declining balance or book value, not the depreciable balance

Annual Depreciation = Depreciation Rate * Book Value at beginning of year

Cannot write-off more total depreciation than the original cost

Determine Budget


Example: Cost of the asset = $10,000 Salvage value = $2,000 Depreciable balance = $8,000 Expected useful life = 5 years Straight line depreciation rate = 1/5 * 100 = 20%

Determine Budget

Year Depreciation Factor Declining Balance (Book Value) Annual Depreciation

1 40% $10,000 $4,000

2 40% $6,000 $2,400

3 40% $3,600 $1,440

4 40% $2,160 $160*

5 40% $2,000 $0

Double Declining Depreciation

* Cannot write off more than the depreciable balance


Units of Production

Cost of the asset is allocated according to the number of units the capital asset is expected to produce

Example: Original cost of a truck = $25,000 Expected total usage = 100,000 miles Cost per mile = $25,000 / 100,000 = $0.25 Expected useful life = 5 years Number of miles per year = 20,000 Depreciable expense = 20,000 * 0.25 = $5,000 per year

Determine Budget


Cost Performance Baseline Approved version of the time-phased budget excluding management reserves

Large projects can have multiple cost baselines (e.g. each phase)

Determine Budget - Outputs



Cost Performance Baseline Approved version of the time-phased budget

excluding management reserves

Project Funding Requirements Determined from the cost baseline Establish total and periodic cost objectives Total funds required include:

Cost baseline Management reserves (due to risks)

Project Document Updates



Control Costs

PMBOK Ref # Fig 7.10



Control Costs



Influences factors that create changes to cost baseline

Monitors cost performance to detect variances from the plan

Ensures that all changes are recorded accurately in the cost baseline

Prevents incorrect, inappropriate or unauthorized changes

Informs appropriate stakeholders of authorized changes

Control Costs


Accounts:

Control Accounts

Control point where measurement of control will

occur

Placed at specific component at selected levels

of the WBS

Chart of Accounts

Numbering system used to monitor project costs

Usually based upon corporate chart of accounts

Control Costs


Project Management Plan

Cost performance baseline

Cost management plan

Project Funding Requirements

Work Performance Data

Organizational Process Assets

Control Costs - Inputs


Earned Value Management

Forecasting

To-Complete Performance Index (TCPI)

Performance Reviews

Variance Analysis

Project Management Software

Control Costs – Tools & Techniques



Earned Value Management Commonly used performance measurement method

Forecasting Project’s future state based on present data

To-Complete Performance Index (TCPI) Cost performance that must be achieved on the remaining work

to meet specified management goal

Performance Reviews

Variance Analysis

Project Management Software

Control Costs


Earned value management assesses project performance by integrating scope, cost and schedule measures.

Cost and schedule variance alone do not provide a complete measure of performance

Benefits Early warning management tool Examines actual accomplishment

Compares what was done with what was planned Uses work in progress to predict future outcomes

Forecast completion date and cost

Control Costs Earned Value Management


Planned Value (PV): Budgeted Cost of Work Scheduled

Earned Value (EV): Budgeted Cost of Actual Work Performed

Actual Cost (AC): Actual Cost of Actual Work Performed

Schedule Variance (SV): SV = EV - PV

Schedule Performance Index (SPI): SPI = EV / PV

Cost Variance (CV): CV = EV - AC

Cost Performance Index (CPI): CPI = EV / AC

Control Costs



Earned Value (EV): Budget x % Complete Methods of determining % Completed:

Milestones (30, 70, 90, 100%) 0-100 50-50 Detailed Evaluation Expert Judgment



Forecasting Estimate based on information and knowledge available now Allows prediction of future costs or completion dates Is a form of trend analysis

Control Costs



BAC - Budget at completion

EAC – Estimate at completion

Remaining work performed at budget rate

EAC = AC + BAC – EV

Use when variances are atypical

Remaining work performed at current CPI

EAC = AC + [(BAC-EV)/CPI] or

EAC = BAC / CPI

Use when variances are typical

Control Costs Forecasting


EAC – Estimate at completion

Remaining work performed considers CPI & SPI

EAC = AC + [(BAC-EV)/(Cumulative CPI *

Cumulative SPI]

ETC - Estimate to Complete

ETC = EAC - AC

VAC - Variance at Completion

VAC = BAC - EAC

Control Costs Forecasting - cont’d


To-Complete Performance Index

Calculated projection of cost performance on remaining work to meet the specified BAC or EAC

TCPI = (BAC - EV) / (BAC - AC) Based on BAC

TCPI = (BAC – EV ) / (EAC – AC) Based on EAC

Refer to Table 7-1: Earned Value Calculations Summary Table PMBOK Page 224

Control Costs


Control Costs To-Complete Performance Index



Examples For each activity:

Calculate Cost Variance (CV)

Calculate Schedule Variance (SV)

For the project:

Calculate Cost Variance (CV)

Calculate Schedule Variance (SV)

Calculate Estimate At Completion (EAC)

Calculate TCPI (BAC) and TCPI (EAC)

Control Costs


Control Costs


Control Costs

CV SV


Control Costs


Example – EV Problem

The project: 5 software package installs on 5 existing PCs in 5 weeks for a total consulting fee of $5,000. After two weeks only 1 install has been done for a cost of $1,500.

Plot PV, AC & EV

Calculate SV, CV, SPI & CPI

Assume the rate of progress continues and calculate EAC and forecast the completion time

Control Costs


Budget at Completion (BAC) = $5,000

Actual Cost (AC) = $1,500

Earned Value (EV) = $1,000

Planned Value (PV) = $2,000

Schedule Variance (SV) = EV – PV = -$1,000

Cost Variance (CV) = EV – AC = -$500

Control Costs Example – EV Problem


Schedule Performance Index (SPI) = EV / PV

= 1000/2000= 0.5

Cost Performance Index (CPI) = EV / AC

= 1000/1500= 0.6667

Estimate at Completion (EAC) = BAC / CPI

= 5000/0.6667= $7,500

Forecast Completion Time = Original Schedule / SPI

= 5 weeks / 0.5= 10 Weeks

Control Costs Example – EV Problem


Performance Reviews

Variance Analysis

Compares actual to planned performance

Trend Analysis

Examines performance over time

Determines if performance is improving or

deteriorating

Earned Value Performance

Compares baseline plan to actual schedule and

cost performance

Control Costs


Variance Analysis

Assesses magnitude and cause of variations to original cost baseline

Use CV & CPI

Allows decision on whether corrective or preventive action is required

Variances tend to decrease as project progresses and more work is accomplished

Control Costs


Work Performance Measurements

Cost Forecasts

Organizational Process Assets Updates

Change Requests

Project Management Plan Updates Cost performance baseline

Cost management plan

Project Document Updates Cost estimates

Basis of estimates

Organization Process Assets Updates

Control Costs - Outputs

7474


PMP Exam PreparationSample Questions


7575

Question #1

The output from Plan Cost Management includes:

A. Activity cost estimates

B. Cost performance baseline

C. Cost management plan

D. Work breakdown structure

Answer:

7676

Question #2

As a project manager, you examine project results over

time to determine how the project is performing. This

can be done through:

A.Performance Reviews

B.Variance Analysis

C.Trend Analysis

D.Earned Value Analysis

Answer:

7777

Question #3

You have recently taken over a project when the

previous project manager resigned. While studying the

project information, you find out that cost variances are

very severe. To provide realistic basis for performance

measurement, you should recommend:

A.Authorizing a budget update

B.Revising the cost baseline

C.Submitting a corrective action for sponsor approval

D.Closing the project

Answer:

7878

Question #4

In your construction project, the CPI is 0.85 and SPI is

1.25. What could be the potential reason:

A.A critical resource went on sick leave for a long period of time, which had not been anticipated earlier.

B.The cost of raw materials required for construction increased 10% - you had anticipated a cost increase of 12% in your project plans.

C.Anticipating delays, the project had to be crashed to decrease duration.

D.There was a 4 days waiting time in the curing of the cement, and work could not be done during that time.

Answer:

7979

Question #5

Your project has 4 tasks A-B-C-D performed one after the other, all on the critical path. All tasks are estimated to require a similar effort of 5 days and cost $5,000 each to accomplish. We are at the end of day 11. Tasks A and B have been completed while task C is only 50% complete. A total of $13,000 has already been spent. What is the Earned Value (EV)?

A.$5,000B.$10,000C.$11,000D.$12,500

Answer:

8080

Question #6

If a project is to employ three people each for 40 hours

at a labor rate of $40 per hour with overhead included

and a fourth person for 30 hours during the same

period, but at a loaded labor rate of $60 per hour, the

Planned Value (PV) for the week is:

A.$1,800

B.$6,600

C.$4,800

D.$5,600

Answer:

8181

Question #7

If cost variance is negative, but schedule variance is

positive, then this indicates:

A.Cost and schedule are not dependent on each other

B.The project is under budget and behind schedule

C.The project is over budget and ahead of schedule

D.Crashing may be recommended to make the cost variance

positive

Answer:

8282

Question #8

While reviewing project performance, the project

manager determines that the schedule variance is -

$500. What is the BEST thing to do:

A.Let the sponsor know

B.Determine the cost variance

C.Look for activities that can be done in parallel

D.Move resources from the project to the one that is not failing

Answer:

8383

Question #9

Your project has 3 tasks A-B-C performed one after the other. Task A is worth $500, is 80% complete, and actually cost $500. Task B is worth $450, is 75% complete, and actually cost $402 so far. Task C is worth $600, is 90% complete, and has cost $550 so far. The total budget is $3,000. What is the cost variance for this project?

A.-$174.50B.$174.50C.$0.84D.$272.50

Answer:

8484

Question #10

In your construction project, the CPI is 1.30 and SPI is 0.85. What could be the potential reason?

A.A critical resource went on sick leave for a long period of time, which had not been anticipated earlier

B.The cost of raw materials required for construction increased 10%

C.You did not take into account inflation rate which increased this year

D.There was 4 days waiting time in the curing of cement, and work could not be done during that time

Answer:

8585

Question #11

Which of the following formulas shows the remaining amount to be spent on the project based on current spending efficiency?

A.BAC/CPIB.EV-PVC.EAC-ACD.EV-AC

Answer:

8686

Question #12

In your project, there have been several changes in the

cost and schedule estimates and the original estimating

assumptions are no longer valid. What is the Estimate

at Completion for your project if BAC = $300,000, AC =

$100,000, EV=$150,000, CPI=1.2, and ETC=$120,000?

A.$250,000B.$220,000C.$280,000D.$300,000

Answer:

8787

Question #13

Your project has 3-tasks A-B-C performed one after the other. Task A is worth $500, is 80% complete, and actually cost $500, Task B is worth $450, is 75% complete, and actually cost $402 so far. Task C is worth $600, is 90% complete, and has cost $550 so far. The total budget is $3,000. What is the estimate at completion for the tasks listed?

A.$3,000.00B.$1,957.09C.$3,409.09D.$409.09

Answer:

8888

Question #14

As a project manager, you examine project results over time to determine how a project is performing. This can be done through:

A.Performance Reviews

B.Variance Analysis

C.Trend Analysis

D.Earned Value Analysis

Answer:

8989

Question #15

The project team is planning an upgrade to a client’s movie production studio. During planning, the team members discover that the lab where editing processes are to reside will not have sufficient space, forcing the client to lease another building. This building will also be shared with another department. What type of Cost would this be?

A.DirectB.IndirectC.VariableD.Indirect Fixed

Answer:

9090

Question #16

You estimate that your project has an earned value of $80,000. Your budget at completion is $150,000. Your project accountant reports actual costs at this point to be around $95,000, while the planned value is reported by your software to be at $100,000. The last time you estimated the costs at project completion you obtained $155,000. What is the To-Complete Performance Index(TCPI) for your project:

A.1.17B.1.27C.-1.17D.-1.27

Answer:

9191

Question #17

Budget forecasts, such as calculated EAC, are an

output of which of the following processes?

A.Estimate Costs

B.Determine Budget

C.Control Costs

D.Control Schedule

Answer:

9292

Question #18

Which of the following tools/techniques is used in the “Control Costs” process?

A.Analogous Estimated

B.Forecasting

C.Parametric Estimating

D.Bottom-up Estimating

Answer:

9393

Question #19

The assumptions made during cost estimation and the constraints that would apply to those estimates can be found in:

A.Activity Cost Estimates

B.Basis of Estimates

C.Cost Performance Baseline

D.Project Funding Requirements

Answer:

9494

Question #20

An estimate that is -25% to +75% of actual is considered a(n):

A.Budget estimate

B.Order of magnitude estimate

C.Definitive estimate

D.Parametric estimate

Answer:

9595

PMP Exam PreparationEnd of Session



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