1 The following types of costs are relevant to making a financial decision except:

　　A opportunity costs

　　B direct costs

　　C sunk cost

　　D unavoidable costs

　　E None of the above

　　ans:C

　　2 Which of the following types of cost are relevant to making financial decisions:

　　A sunk cost

　　B opportunity cost

　　C material cost

　　D A and C only

　　E B and C only

　　ans:E

　　3 In which of the following cost estimating techniques are statistics models used:

　　A nonparametric cost estimating

　　B parametric cost estimating

　　C life cycle cost estimating

　　D bottom-up estimating

　　E All of the above.

　　ans:B

　　4 Under the terms of 2/10 net 30, the buyer may:

　　A deduct 10% of the invoice amount for payment within 30 days

　　B deduct 2% of the invoice for payment within 10 days

　　C incurs a penalty on 10% for payments more than 30 days late

　　D settle the invoice with 2 equal payments; one within 10 days and the other within 30 days

　　E None of the above

　　ans:B

　　5 Which of the following is referred to as payback period:

　　A the number of periods required to recover the initial investment

　　B the rate of return on the investment

　　C the number of periods required to bring project cost back to the original budget, based on current performance

　　D loan payment schedule

　　E None of the above

　　ans:A

　　6 Which of the following is referred to as sunk cost:

　　A management reserve

　　B contingency fund

　　C cost budgeted for construction under water

　　D expended funds over which there is no further control

　　E forecasted budget over-runs

　　ans:D

　　7 The future value of an annual income flow of $1000 for 2 years at 10% is:

　　A $2,200

　　B $2,280

　　C $2,300

　　D $2,310

　　E None of the above

　　ans:D

　　8 The net present value of $110 one year from now at 10% is:

　　A $100

　　B $120

　　C $121

　　D $100 less taxes

　　E $100 less taxes and interest

　　ans:A

　　9 Which of the following depreciation methods provides for accelerated depreciation of an asset:

　　A Double declining balance.

　　B Straight line.

　　C Exponential depreciation

　　D Double sum of the years digits

　　E Double increasing balance

　　ans:A

　　10 Which of the following is considered a direct cost for producing a widget?

　　A The cost of the materials used to produce a widget.

　　B The labor costs of the workers who actually produced the widget.

　　C The rent for the building in which the widget was manufactured

　　D The salary of senior management and the project sponsor

　　E A and B only

　　ans:E

　　11 The reason that cost management is so difficult in project management is that:

　　A Projects by definition and nature are non-recurring events and are therefore difficult to predict.

　　B There are no tools for identifying project tasks.

　　C Project managers do not care about tracking costs, as only schedules are important to all project managers.

　　D A and B only

　　E B and C only

　　ans:A

　　12 Upon completion of 75% of the project, the original schedules and cost estimates that were submitted at the inception of the project are referred to as the:

　　A Baseline costs

　　B Budgeted costs.

　　C Estimates upon completion costs

　　D Scheduled costs

　　E None of the above

　　ans:A

　　13 The difference between the BCWS and the BCWP is referred to as the:

　　A Schedule variance

　　B Cost variance.

　　C Estimate of completion

　　D Actual cost of the work performed

　　E None of the above

　　ans:A

　　14 When a project manager is running over the budgeted costs, the project manager can typically _____ to attempt to get the project back on budget.

　　A Reduce features and/or functionality

　　B Increase risk.

　　C Incur a schedule slippage （to obtain more favorable pricing due to lengthened delivery times）

　　D All of the above.

　　E A and B only

　　ans:D

　　15 Typically, during which phase in a project life cycle are most of the project expenses incurred.

　　A Concept phase

　　B Development of design phase

　　C Execution phase.

　　D Termination phase.

　　E None of the above

　　ans:C

　　16 What tool have project managers come to use to identify all of the costs associated with a project.

　　A A bill of materials

　　B A Gantt chart

　　C An arrow diagram network.

　　D A work breakdown structure.

　　E B and C only.

　　ans:D

　　17 You must produce 27 widgets. You can only produce 9 widgets per production run. Each production line setup costs $1000. Each widget consumes $10 worth of material and $5 worth of labor. What is total variable cost for producing one widget.

　　A $1,020

　　B $1,010

　　C $1,015

　　D $20

　　E None of the above

　　ans:E

　　18 You must produce 27 widgets. You can only produce 9 widgets per production run. Each production line setup costs $1000. Each widget consumes $10 worth of material and $5 worth of labor. What is the total fixed cost for producing the widgets.

　　A $3,000

　　B $27,000

　　C $27,270

　　D $1,335

　　E $1,000

　　ans:E

　　19 In a contract, the point of total assumption refers to the point where:

　　A The customer incurs the total financial responsibility for each additional dollar spent.

　　B The contractor incurs the total financial responsiblity for each dollar spent.

　　C The schedule and cost variance are zero.

　　D The customer will incur no further costs for the work the contractor performs in the completion of the contract.

　　E B and D only.

　　ans:E

　　20 The salvage value of an asset is:

　　A The value of the scrap metal if a new asset were taken to a scrap yard.

　　B The value that an asset has on the books after one year of depreciation.

　　C The costs that have been sunk into the project to date.

　　D The expected cash value at the end of an assets useful life.

　　E A and D only.

　　ans:D