Question 1

Organizational tradition has little or no impact on the firm's project budgeting.

Accepted Answer

A) True 
 B)False

Question 2

Expected value is a tool for risk analysis.

Accepted Answer

A) True 
 B)False

Question 3

Contrast activity versus program budgeting.

Accepted Answer

Activity budgeting and program budgeting...

Question 4

Briefly explain how learning curves can help improve the cost estimating process.

Accepted Answer

The answer of Briefly explain how learning curves can help...

Question 5

There is a 30 percent chance that a new product development project will result in sales of $500,000 and a 70 percent chance that the project will result in sales of $100,000. What is the expected value of this project?

Accepted Answer

A)   $220,000
B)   $240,000
C)   $300,000
D)   $320,000
E)   $340,000F) C) and D)
G) B) and C)

Question 6

A budget is a plan for allocating resources to project activities.

Accepted Answer

A) True 
 B)False

Question 7

Mechanical tasks typically have higher learning rates than more mental tasks.

Accepted Answer

A) True 
 B)False

Question 8

Explain how budget uncertainly changes as the project progresses.

Accepted Answer

Budget uncertainty in a project typicall...

Question 9

Activity budgets show expenses by task and expected time period of the expenditure.

Accepted Answer

A) True 
 B)False

Question 10

A key advantage of top-down budgeting is that the overall budget costs can be estimated quite accurately.

Accepted Answer

A) True 
 B)False  True

Question 11

Organizations can use both top-down and bottom-up budgeting.

Accepted Answer

A) True 
 B)False

Question 12

Individual elements of project budgets are generally more accurate in bottom-up budgeting.

Accepted Answer

A) True 
 B)False

Question 13

Contingency planning is generally begun at that point in time when an organization finds itself in serious financial trouble.

Accepted Answer

A) True 
 B)False  False

Question 14

The project manager recognizes an expense when an invoice is actually paid.

Accepted Answer

A) True 
 B)False

Question 15

A disaster is an event that may have an extraordinarily high cost if it occurs, but has a very low probability of occurring.

Accepted Answer

A) True 
 B)False

Question 16

Random errors will tend to cancel out.

Accepted Answer

A) True 
 B)False

Question 17

Risk management includes what three areas?

Accepted Answer

The answer of Risk management includes what three areas?...

Question 18

A requirement of top-down budgeting is:

Accepted Answer

A)   involvement of the project team
B)   estimating the detailed level of the project's tasks
C)   applying the learning curve to labor time estimates
D)   all of the above
E)   none of the aboveF) D) and E)
G) A) and D)

Question 19

Which of the following is not true regarding bottom-up budgeting?

Accepted Answer

A)   The method tends to be inaccurate in the detailed tasks.
B)   The WBS is used to identify the elemental tasks.
C)   It is rarely used.
D)   It is a good managerial training technique.
E)   All of the above are true concerning top-down budgeting.F) A) and D)
G) B) and D)

Question 20

The result of game theory analysis is a Risk Priority Number.

Accepted Answer

A) True 
 B)False  False

Exam 4: Budgeting the Project

Organizational tradition has little or no impact on the firm's project budgeting.

Correct AnswerverifiedShow Answer

Expected value is a tool for risk analysis.

Correct AnswerverifiedShow Answer

Contrast activity versus program budgeting.

Correct AnswerAnswered by ExamLex AIActivity budgeting and program budgeting...View AnswerShow Answer

Briefly explain how learning curves can help improve the cost estimating process.

Correct AnswerverifiedShow Answer

There is a 30 percent chance that a new product development project will result in sales of $500,000 and a 70 percent chance that the project will result in sales of $100,000. What is the expected value of this project?

Correct AnswerverifiedShow Answer

A budget is a plan for allocating resources to project activities.

Correct AnswerverifiedShow Answer

Mechanical tasks typically have higher learning rates than more mental tasks.

Correct AnswerverifiedShow Answer

Explain how budget uncertainly changes as the project progresses.

Correct AnswerAnswered by ExamLex AIBudget uncertainty in a project typicall...View AnswerShow Answer

Activity budgets show expenses by task and expected time period of the expenditure.

Correct AnswerverifiedShow Answer

A key advantage of top-down budgeting is that the overall budget costs can be estimated quite accurately.

Correct AnswerverifiedTrue

Organizations can use both top-down and bottom-up budgeting.

Correct AnswerverifiedShow Answer

Individual elements of project budgets are generally more accurate in bottom-up budgeting.

Correct AnswerverifiedShow Answer

Contingency planning is generally begun at that point in time when an organization finds itself in serious financial trouble.

Correct AnswerverifiedFalse

The project manager recognizes an expense when an invoice is actually paid.

Correct AnswerverifiedShow Answer

A disaster is an event that may have an extraordinarily high cost if it occurs, but has a very low probability of occurring.

Correct AnswerverifiedShow Answer

Random errors will tend to cancel out.

Correct AnswerverifiedShow Answer

Risk management includes what three areas?

Correct AnswerverifiedShow Answer

A requirement of top-down budgeting is:

Correct AnswerverifiedShow Answer

Which of the following is not true regarding bottom-up budgeting?

Correct AnswerverifiedShow Answer

The result of game theory analysis is a Risk Priority Number.

Correct AnswerverifiedFalse

Correct Answer
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Correct Answer
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Correct Answer
Answered by ExamLex AI
Activity budgeting and program budgeting...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
Answered by ExamLex AI
Budget uncertainty in a project typicall...
View Answer

Correct Answer
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Correct Answer
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True

Correct Answer
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Correct Answer
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Correct Answer
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False

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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False