Exam 7: Budgeting and Risk Management

You have been asked to estimate the costs for a project to build an industrial power plant.Based on historical data,the steam turbine accounts for 30 percent of the total costs for the plant.If the steam turbine costs $300,000,the expected top-down estimated cost for this project would be __________.

Many lower-level managers often treat the entire budgeting process as if it were a __________,a situation in which any individual's gain is another individual's loss.This can make competition among junior managers quite intense.

An easy method of evaluating risk in certain situations by modifying project parameters and evaluating the corresponding changes is __________.

Describe the top-down budgeting process.

Kaplan et al.(2012)identified three types of risk that must be faced.List and describe each one.

__________ budgeting aggregates income and expenditures by project or program,often in addition to aggregation by organizational unit or activity.

Briefly describe the seven processes for risk management.

__________ budgeting allows income and expenditures to be aggregated across projects.

Describe the bottom-up budgeting process.

The budget process generally begins when the top management invites each division to submit a__________ for the upcoming year.

Suppose that a person requires 60 minutes to complete a work element on the first attempt.On the second attempt,the work element is completed in 48 minutes.The learning rate for this person is __________% for this work element.

The __________ charge is composed of the costs of senior management,the various data functions,and any other expenses not included in overhead.Often,these charges are a fixed percentage of either the direct costs or the total of all direct and indirect costs.

Which cost should the project manager completely ignore in managing a project?

The Pathfinder Mission was to go where?

If a project budget is underfunded,it will often __________.

__________ relies on well-known statistical correlations between various factors such as the total cost of a house relative to the square feet of living area.

The advantage of the______ process is that it is generally associated with participative management.

Given a project salary cost of $400,000 per year and forecasted wage increases of 5 percent per year,calculate the non-discounted total salary cost over a three-year project lifecycle.

When a firm has professional cost estimators,what is their main responsibility?

Which of the following is not one of the risk management subprocesses?