PMP Rita Exam Prep Questions -7-Answered

1. One common way to compute estimate at completion (EAC) is to take the budget at completion (BAC) and: A. Divide by SPI B. Multiply by SPI C. Multiply by CPI D. Divide by CPI - ANSWER-Answer D This question is asking for the formula for EAC, which is BAC/CPI. Notice how you will have to remember the formula to get the answer correct. 2. Estimate at completion (EAC) is a periodic evaluation of: A. The cost of work completed B. The value of work performed C. The anticipated total cost at project completion D. What it will cost to finish the job - ANSWER-Answer C When you look at earned value, many of the terms have similar definitions. This could get you into trouble. Since the EAC means the estimate at completion, choice C is the best answer. Choice D is the definition of ETC, estimate to complete. 3. If earned value (EV) = 350, actual cost (AC) = 400, planned value (PV) = 325, what is cost variance (CV)? A. 350 B. -75 C. 400 D. -50 - ANSWER-Answer D CV = EV - AC 4. The customer responsible for overseeing your project asks you to provide a written cost estimate that is 30 percent higher than your estimate of the project's cost. He explains that the budgeting process requires managers to estimate pessimistically to ensure enough money is allocated for projects. What is the BEST way to handle this? A. Add the 30 percent as a lump sum contingency fund to handle project risks B. Add the 30 percent to your cost estimate by spreading it evenly across all project activities C. Create one cost baseline for budget allocation and a second one for the actual project management plan D. Ask for information on risks that would cause your estimate to be too low - ANSWER-Answer D