ADM Budgeting & Financial Management 3

Question 1

Which technique is most appropriate for estimating the financial impact of technical debt on future delivery capacity?

Accepted Answer

Tracking velocity degradation over time and projecting its cost

Answer

Monte Carlo simulation using story point data

Answer

Using a fixed 20% overhead rate on all sprint budgets

Answer

Requesting a third-party audit of the codebase

Question 2

An Agile Delivery Manager is asked to justify continued investment in a struggling initiative. Which framework provides the most structured approach?

Accepted Answer

Weighted Shortest Job First (WSJF) scoring to compare against alternatives

Answer

SWOT analysis of the development team

Answer

A retrospective action item list

Answer

A stakeholder satisfaction survey

Question 3

In agile financial management, what does 'CapEx vs. OpEx' classification primarily affect?

Accepted Answer

How development costs are recorded and taxed on the balance sheet

Answer

The team's sprint velocity target

Answer

The number of features delivered per quarter

Answer

The frequency of retrospectives held by the team

Question 4

What is the primary financial benefit of a 'fail fast' culture in agile delivery?

Accepted Answer

It limits sunk costs by identifying non-viable investments early

Answer

It allows teams to skip testing phases to save time

Answer

It guarantees faster time-to-market for all features

Answer

It reduces team headcount requirements

Question 5

How should an Agile Delivery Manager approach budget reforecasting mid-program?

Accepted Answer

Reforecast at each program increment boundary using actual throughput and remaining scope

Answer

Wait until the end of the program to reconcile all costs

Answer

Request a one-time budget adjustment from the CFO

Answer

Freeze the original forecast to maintain stakeholder confidence

Question 6

Which contract model best supports an agile engagement with an external client while managing financial risk for both parties?

Accepted Answer

Capped time-and-materials with iterative scope definition

Answer

Fixed-price, fixed-scope contract

Answer

Time-and-materials contract with no spending cap

Answer

Cost-plus contract with unlimited reimbursement

Question 7

An Agile Delivery Manager wants to calculate Return on Investment (ROI) for a completed initiative. Which inputs are required?

Accepted Answer

Net benefit delivered minus total investment cost, divided by total investment cost

Answer

Team velocity, sprint count, and defect density

Answer

Story points completed, cost per point, and customer NPS score

Answer

Number of releases shipped and mean time to recovery