177 Helpful Free Online PMP Exam Practice Questions On Planning The Project – Part 2

Hi again, welcome to you move on the part 2 to practice with 177 Helpful Free Online PMP Exam Practice Questions On Planning The Project – Part 2. As you know already, it is not easy to get the PMP certification because there are a lot of area which will be included in the examination namely initiating the project, planning the project, executing the project, monitoring and controlling the project and closing the project. Get further pmp information here. Thus, some people have failed at the first time, second one, even the third time, it is normal. To ensure that you have enough knowledge to pass your exam that you should have a good preparation before taking the exam. Practice free online PMP prep exam question that is the best way to help yourself pass the exam. Let’s continuous starting at part 2 and you should note your result to know what you need to pratice more. Good time!

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177 Helpful Free Online PMP Exam Practice Questions On Planning The Project - Page 1

1. Expert Judgement2. Analogous Estimating3. Parametric Estimating4. Bottom-up Estimating5. Three-Point Estimates6. Reserve Analysis7. Cost of Quality (COQ)8. Project Management Estimating Software9. Vendor Bid Analysis

Risk Register Use in Estimate Costs
WBS Use in Estimate Costs
Outputs of Estimate Costs
Tools and Techniques for Estimate Costs

The total of Planned Value

Management Reserves
Performance Reviews
Cost Management Plan
Performance Measurement Baseline

Budget reserve analysis can establish both the contingency reserves and the management reserves for the project

Project Schedule Use in Determine Budget
WBS Dictionary Use in Determine Budget
Contracts Use in Determine Budget
Reserve Analysis Use in Determine Budget

The project management plan contains the following information that is used to control cost:• Cost Performance Baseline• Cost Management Plan

Characteristics of Control Costs
Project Schedule Use in Estimate Costs
Cost Management Plan Use in Control Costs
Project Management Use in Control Costs

• Is a method of estimating a component of work• The cost of individual work packages or activities is estimated with the greatest level of specified detail. • The detailed cost is then summarized or "rolled up" to higher levels for subsequent reporting and tracking purposes. • The cost and accuracy of bottom-up cost estimating is typically influenced by the size and complexity of the individual activity or work package

Cost of Quality (COQ) Use in Estimate Costs
Analogous Estimating Use in Estimate Costs
Bottom-up Estimating Use in Estimate Costs
Human Resource Plan Use in Estimate Costs

A prediction that is based on the information known at a given point in time. It includes the identification and consideration of costing alternatives to initiate and complete the project

Estimating Costs
Project Budgets
Cost Estimates
Indirect Costs

Estimate Activity Resources involves determining the availability and quantities required of staff and material needed to perform schedule activities. It is closely coordinated with cost estimating

Risk Register Use in Estimate Costs
Estimate Activity Resources Impact on Estimate Costs
Market Conditions Impact on Estimate Costs
Published Commercial Information Impact on Estimate Costs

• include the cost of operations, which is beyond the scope of the project• Includes direct and indirect costs• Includes periodic or continuing cost of operations and maintenance• life cycle costs are not the responsibility of the project manager

Contingency Reserves
Life Cycle Costs
Estimating Costs
BCR < 1

Budgets reserved for unplanned changes to project scope and cost

Cost Management Plan
Management Reserves
Indirect Costs
Units of Measure

• Analysis of project performance can result in a change request to the cost performance baseline or other components of the project management plan. • Change requests can include preventive or corrective actions and are processed for review and disposition through the Perform Integrated Change Control process

Control Costs: Change Requests
Benefit Cost Ratio: Equation
Control Costs: Work Performance Measurements
Project Budgets

whereby a task is considered to be either 0 percent complete or 100 percent complete, but nothing in between

SPI Use
SPI > 1
BCR > 1
0-100 Rule

critical path methodology (CPM) scheduling and risk management

SV best used in conjunction with
TCPI Based on EAC: Equation
Risk Register Use in Estimate Costs
Process Descriptions

Is a measure of schedule performance on a project.It is equal to the earned value (EV) minus the planned value (PV)

Schedule Variance
Cost Estimates
Schedule Performance Index
Cost Baseline

• Should be reviewed to consider risk mitigation costs• Risks, which can be either threats or opportunities, typically have an impact on both activity and overall project costs. • As a general rule, when the project experiences a negative risk event, the near-term cost of the project will usually increase, and there will sometimes be a delay in the project schedule

Human Resource Plan Use in Estimate Costs
Risk Register Use in Estimate Costs
Inputs to Estimate Costs
Three-Point Estimates Use in Estimate Costs

Resource cost rate information is often available from commercial databases that track skills and human resource costs, and provide standard costs for material and equipment. Published seller price lists are another source of information.

Risk Register Use in Estimate Costs
Parametric Estimating Use in Estimate Costs
Published Commercial Information Impact on Estimate Costs
Market Conditions Impact on Estimate Costs

• Schedule variance• Cost variance

Outputs of Control Costs
Efficiency Indicators monitored as part of Control Costs
Variances monitored as part of Control Costs
Project Management Use in Control Costs

• Use a statistical relationship between historical data and other variables (e.g., square footage in construction) to calculate an estimate for activity parameters, such as cost, budget, and duration. • This technique can produce higher levels of accuracy depending upon the sophistication and underlying data built into the model. • Can be applied to a total project or to segments of a project, in conjunction with other estimating methods.

Project Schedule Use in Estimate Costs
Parametric Estimating Use in Estimate Costs
Scope Statement Use in Estimate Costs
Reserve Analysis Use in Estimate Costs

EAC = AC + BAC - EV

EAC forecast for ETC (work performed at the budgeted rate): Equation
EAC forecast for ETC (work performed at the present CPI)
EAC forecast for ETC (considering both SPI and CPI factors)
Project Selection is performed in the

• Make versus buy• Buy versus lease• Sharing of resources

Process Descriptions
Inputs to Estimate Costs
Accuracy of Cost Estimates
Examples of Cost Trade Offs and Risks

Cost Performance Index

• The project manager may be required to obtain approval before obligating or spending management reserve. • Are not a part of the project cost baseline, but may be included in the total budget for the project. • They are not included as a part of the earned value measurement calculations

Characteristics of Management Reserves
Cost Management Plan
Characteristics of Cost Estimates
Characteristics of EV

Cost estimates are aggregated by work packages in accordance with the WBS. The work package cost estimates are then aggregated for the higher component levels of the WBS (such as control accounts) and ultimately for the entire project

Contracts Use in Determine Budget
Cost Aggregation Use in Determine Budget
Inputs to Determine Budget
Tools and Techniques for Determine Budget

Those costs that cannot be directly traced to a specific project and therefore will be accumulated and allocated equitably over multiple projects by some approved and documented accounting procedure

SPI > 1
Payback Period
Planned Value
Indirect Costs

• Influencing the factors that create changes to the authorized cost baseline,• Ensuring that all change requests are acted on in a timely manner,• Managing the actual changes when and as they occur,• Ensuring that cost expenditures do not exceed the authorized funding, by period and in total for the project,• Monitoring cost performance to isolate and understand variances from the approved cost baseline,• Monitoring work performance against funds expended• Preventing unapproved changes from being included

Control Costs
Project cost control includes
Project Cost Management
Inputs of Control Costs

• Project management cost estimating software applications, computerized spreadsheets, simulation, and statistical tools are becoming more widely accepted to assist with cost estimating. • Such tools can simplify the use of some cost estimating techniques and thereby facilitate rapid consideration of cost estimate alternatives

Project Management Estimating Software Use in Estimate Costs
Risk Register Use in Estimate Costs
Parametric Estimating Use in Estimate Costs
Bottom-up Estimating Use in Estimate Costs

Used to monitor the three EVM dimensions (PV, EV, and AC), to display graphical trends, and to forecast a range of possible final project results

Outputs of Control Costs
Expert Judgement Use in Estimate Costs
Project Management Software Use in Control Costs
Work Performance Information Use in Control Costs

Earned value management compares the baseline plan to actual schedule and cost performance

Performance Review: Earned Value Performance
Performance Review: Variance Analysis
Performance Review Information when using EVM
Performance Measurement Baseline

Variance thresholds for monitoring cost performance may be specified to indicate an agreed-upon amount of variation to be allowed before some action needs to be taken. Thresholds are typically expressed as percentage deviations from the baseline plan

Forecasting
Control Thresholds
Units of Measure
Vendor Bid Analysis

• The expenditure of funds should be reconciled with any funding limits on the commitment of funds for the project. • A variance between the funding limits and the planned expenditures will sometimes necessitate the rescheduling of work to level out the rate of expenditures. • This can be accomplished by placing imposed date constraints for work into the project schedule

Determine Budget: Organizational Process Assets
Determine Budget: Funding Limit Reconciliation
Determine Budget: Project Funding Requirements
Determine Budget: Project Document Updates

a manual, bottom-up summation by the project manager and project team

Most common EAC forecasting approach
Control Costs: Budget Forecasts
Outputs of Estimate Costs
Cost Estimates

• Cost performance measurements (CV, CPI) are used to assess the magnitude of variation to the original cost baseline. • Important aspects of project cost control include determining the cause and degree of variance relative to the cost performance baseline and deciding whether corrective or preventive action is required. •The percentage range of acceptable variances will tend to decrease as more work is accomplished. • The larger percentage variances allowed at the start of the project can decrease as the

Variance Analysis Use in Control Cost
Control Costs
Reserve Analysis Use in Determine Budget
Project Management Software Use in Control Costs

• The EV being measured must be related to the PV baseline (PMB)• The EV measured cannot be greater than the authorized PV budget for a component• The term EV is often used to describe the percentage completion of a project• A progress measurement criteria should be established for each WBS component to measure work in progress• Project managers monitor EV, both incrementally to determine current status and cumulatively to determine the long-term performance trends

Management Reserves
Direct Costs
Characteristics of Cost Estimates
Characteristics of EV

• This method assumes what the project has experienced to date can be expected to continue in the future. • The ETC work is assumed to be performed at the same cumulative cost performance index (CPI) as that incurred by the project to date.

EAC forecast for ETC (work performed at the budgeted rate): Equation
EAC forecast for ETC (work performed at the budgeted rate)
EAC forecast for ETC (work performed at the present CPI): Equation
EAC forecast for ETC (work performed at the present CPI)

unit cost rates in calculations, but doesn't determine those rates

Outputs of Estimate Costs
Determine Budget
Parametric Estimating Use in Estimate Costs
Parametric estimating uses

• Are generally expressed in units of some currency (i.e., dollars, euro, yen, etc.), although in some instances other units of measure, such as staff hours or staff days, are used to facilitate comparisons by eliminating the effects of currency fluctuations• Sources of input information are derived from the outputs of project processes in other Knowledge Areas• Estimated for all resources that will be charged to the project. This includes, but is not limited to, labor, materials, equipment, services, and f

Characteristics of Cost Estimates
Cost Estimates
Characteristics of EV
Characteristics of Management Reserves

• Variance analysis• Trend analysis• Earned value performance

Schedule Performance Index
Determine Budget Process Group
Project Selection Criterion with BCR
Performance Review Information when using EVM

• Causes of variances,• Corrective action chosen and the reasons, and• Other types of lessons learned from project cost control

Control Costs: Project Management Plan Updates
Control Costs: Organizational Process Assets
Control Costs: Organizational Process Assets Updates
Estimate Costs: Project Document Updates

Is the calculated projection of cost performance that must be achieved on the remaining work to meet a specified management goal, such as the BAC or the EAC

Cost Variance indicates
Cost Performance Index
To Complete Performance Index
Project Cost Performance

a project selection criteria

Control Costs
Accuracy of Cost Estimates
Opportunity Cost is not...
Negative CV is often

• Cost estimates• Basis of estimates

Control Costs: Project Document Updates
Control Costs: Budget Forecasts
Determine Budget: Project Document Updates
Control Costs: Change Requests

The cost management plan describes how the project costs will be managed and controlled

Variance Analysis Use in Control Cost
Outputs of Control Costs
Cost Management Plan Use in Control Costs
Human Resource Plan Use in Estimate Costs

Applicable contract information and costs relating to products, services, or results that have been purchased are included when determining the budget

Reserve Analysis Use in Determine Budget
Outputs of Determine Budget
Resource Calendars Use in Determine Budget
Contracts Use in Determine Budget

• Cost estimates are influenced by numerous variables such as labor rates, material costs, inflation, risk factors, and other variables. • Provides valuable insight about the environment and information from prior similar projects. • Can also be used to determine whether to combine methods of estimating and how to reconcile differences between them

Expert Judgement Use in Estimate Costs
Human Resource Plan Use in Estimate Costs
WBS Dictionary Use in Estimate Costs
Project Management Use in Control Costs

1. Project Management Plan2. Project Funding Requirements3. Work Performance Information4. Organizational Process Assets

Units of Measure
Level of Accuracy
Inputs of Control Costs
Vendor Bid Analysis

• The risk register

Characteristics of Project Cost Management
Estimate Costs Process Group
Characteristics of Cost Estimates
Estimate Costs: Project Document Updates

Reflect the cost and schedule performance of any project for comparison against all other projects or within a portfolio of projects. The variances and indices are useful for determining project status and providing a basis for estimating project cost and schedule outcome

Performance Reviews
Negative CV is often
Direct Costs
Efficiency Indicators

Resource calendars provide information on which resources are assigned to the project and when they are assigned. This information can be used to indicate resource costs over the duration of the project

Resource Calendars Use in Determine Budget
Reserve Analysis Use in Estimate Costs
Outputs of Determine Budget
WBS Use in Determine Budget

Planning Process Group

Control Costs
Control Costs Process Group
Control Thresholds
Control Costs: Project Document Updates

• Historical information used to develop the model is accurate,• Parameters used in the model are readily quantifi able, and• Models are scalable, such that they work for a large project, a small project, and phases of a project

Cost and accuracy of parametric models are more reliable when
Reserve Analysis Use in Determine Budget
Contracts Use in Determine Budget
Estimate Activity Duration Impact on Estimate Costs

Zero, because all planned values will have been earned

Cost Variance indicates
Schedule Variance
Schedule Variance when project is completed
Characteristics of Cost Estimates

Compare cost performance over time, schedule activities or work packages overrunning and under running the budget, and estimated funds needed to complete work in progress

Performance Reviews
Project Budgets
Vendor Bid Analysis
Cost Performance Index

177 Helpful Free Online PMP Exam Practice Questions On Planning The Project – Part 2

177 Helpful Free Online PMP Exam Practice Questions On Planning The Project - Page 1

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