Cost Estimation Quiz: Product Management

20 Questions | Total Attempts: 187

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Cost Estimation Quiz: Product Management

The quiz below is designed to test what you know about cost estimation when it comes to product management. The whole product management plan depends on different resources that require some money to be used if someone does not put a cost estimate; the project may be under or overfunded. Take up this quiz and see how good you are when it comes to cost estimation.


Questions and Answers
  • 1. 
    The additional percentage or dollar amount by which actual costs exceed estimates
    • A. 

      Controlling Costs

    • B. 

      Estimating Costs

    • C. 

      Overrun

  • 2. 
    The processes required to ensure that a project team completes a project within an approved budget 
    • A. 

      Indirect Costs

    • B. 

      Project Cost Management

    • C. 

      Tangible Costs or Benefits

  • 3. 
    Developing an approximation or estimate of the costs of the resources needed to complete a project 
    • A. 

      Estimating Costs

    • B. 

      Profit Margin

    • C. 

      Cash Flow Analysis

  • 4. 
    Allocating the overall cost estimate to individual work items to establish a baseline for measuring performance 
    • A. 

      Controlling Costs

    • B. 

      Determining The Budget

    • C. 

      Estimating Costs

  • 5. 
    Controlling changes to the project budget
    • A. 

      Determining The Budget

    • B. 

      Estimating Costs

    • C. 

      Controlling Costs

  • 6. 
    Revenues minus expenditures
    • A. 

      Intangible Costs or Benefits

    • B. 

      Profits

    • C. 

      Cash Flow Analysis

  • 7. 
    The ratio of revenues to profits
    • A. 

      Tangible Costs or Benefits

    • B. 

      Indirect Costs

    • C. 

      Profit Margin

  • 8. 
    A big-picture view of the cost of a project throughout its life cycle
    • A. 

      Life Cycle Costing

    • B. 

      Cash Flow Analysis

    • C. 

      Profits

  • 9. 
    A method for determining the estimated annual costs and benefits for a project and the resulting annual cash flow 
    • A. 

      Cash Flow Analysis

    • B. 

      Profits

    • C. 

      Reserves

  • 10. 
    Costs or benefits that an organization can easily measure in dollars 
    • A. 

      Cash Flow Analysis

    • B. 

      Tangible Costs or Benefits

    • C. 

      Intangible Costs or Benefits

  • 11. 
    Costs or benefits that are difficult to measure in monetary terms
    • A. 

      Tangible Costs or Benefits

    • B. 

      Cash Flow Analysis

    • C. 

      Intangible Costs or Benefits

  • 12. 
    Costs that can be directly related in producing the products and services of the project 
    • A. 

      Indirect Costs

    • B. 

      Life Cycle Costing

    • C. 

      Direct Costs

  • 13. 
    Costs that are not directly related to the products or services of the project, but are indirectly related to performing the project 
    • A. 

      Tangible Costs or Benefits

    • B. 

      Indirect Costs

    • C. 

      Direct Costs

  • 14. 
    Money that has been spent in the past
    • A. 

      Sunk Cost

    • B. 

      Reserves

    • C. 

      Direct Costs

  • 15. 
    States that when many items are produced repetitively, the unit cost of those items decreases in a regular pattern as more units are produced. 
    • A. 

      Management Reserves (Unknown Unknowns)

    • B. 

      Cash Flow Analysis

    • C. 

      Learning Curve Theory

  • 16. 
    Dollars included in a cost estimate to mitigate cost risk by allowing for future situations that are difficult to predict 
    • A. 

      Sunk Cost

    • B. 

      Budgetary Estimate

    • C. 

      Reserves

  • 17. 
    Allow for future situations that may be partially planned for and are included in the project baseline 
    • A. 

      Learning Curve Theory

    • B. 

      Contingency Reserves (Known Unknowns)

    • C. 

      Management Reserves (Unknown Unknowns)

  • 18. 
    Allow for future situations that are unpredictable 
    • A. 

      Management Reserves (Unknown Unknowns)

    • B. 

      Contingency Reserves (Known Unknowns)

    • C. 

      Cost Management Plan

  • 19. 
    Provides an estimate of what a project will cost. 
    • A. 

      Budgetary Estimate

    • B. 

      Definitive Estimate

    • C. 

      Rough Order of Magnitude (ROM) Estimate

  • 20. 
    Used to allocate money into an organization’s budget
    • A. 

      Rough Order of Magnitude (ROM) Estimate

    • B. 

      Budgetary Estimate

    • C. 

      Definitive Estimate

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