PMBOK PMBOK Project Cost Management Questions and Answers

Question 1

What is the primary purpose of the Plan Cost Management process in PMBOK?

Accepted Answer

To define how project costs will be estimated, budgeted, managed, and controlled

Answer

To approve the project budget

Answer

To calculate the earned value of completed work

Answer

To identify and analyze project cost risks

Question 2

Which cost estimating technique breaks down deliverables into smaller components and estimates cost at the work package level?

Accepted Answer

Bottom-up estimating

Answer

Analogous estimating

Answer

Parametric estimating

Answer

Three-point estimating

Question 3

What is the Budget at Completion (BAC) in cost management?

Accepted Answer

The approved total budget for all project work

Answer

The total actual cost spent at project completion

Answer

The forecasted cost to complete the remaining work

Answer

The difference between earned value and actual cost

Question 4

A cost estimate expressed as a range such as -25% to +75% is known as a:

Accepted Answer

Rough order of magnitude (ROM) estimate

Answer

Definitive estimate

Answer

Parametric estimate

Answer

Control account estimate

Question 5

Which PMBOK process produces the Cost Baseline?

Accepted Answer

Determine Budget

Answer

Plan Cost Management

Answer

Estimate Costs

Answer

Control Costs

Question 6

What does the term 'sunk cost' mean in project cost management?

Accepted Answer

Costs that have already been incurred and cannot be recovered

Answer

Costs that are reserved for unplanned risks

Answer

Costs associated with scope changes

Answer

Variable costs that change with project activity levels