Discuss Cost Benefit Analysis questions

Discuss Cost Benefit Analysis questions
 Your project team is involved in estimating the cost of the project as a part of project cost
management. Which of the following tools and techniques will NOT be applicable for this purpose?
a) Cost Benefit Analysis
b) Reserve Analysis
c) Cost of Quality
d) Vendor Bid Analysis
Answer: (a) Cost Benefit Analysis. Reserve Analysis, option (b), is an analytical technique to
determine a reserve for budget, estimated costs and funds for the project. It is an important
technique in the process of estimating costs. Option (c) Cost of Quality is the sum of all costs a
company invests into the release of a quality product and can be used to prepare cost estimates.
Option (d) Vendor Bid Analysis can also be used as a technique to evaluate the project cost based on
responsive bids from qualified vendors. However, (a) Cost Benefit Analysis is a technique that
compares positive factors or benefits with negative ones to determine the net result of doing the
action. It is a popular technique for selecting projects, but will not be useful during cost estimation t
the activity level. Please refer to PMBOK® Guide – Sixth Edition Project Cost Management pg. 231
for more details.
Discuss Cost Benefit Analysis questions
38. The common term for an authorized time phase budget at completion (BAC) used to measure cost
performance and displayed in the form of an S curve is:
a) Earned Value
b) Cost Performance Index
c) Cost Baseline
d) Project Budget
Answer: (c) Cost Baseline. It provides a yardstick against which you can measure cost performance.
Please refer to PMBOK® Guide – Sixth Edition pg. 231 for definition of cost baseline.
39. A project team is in the process of identifying quality requirements and standards for the project
and documenting how the project will demonstrate compliance. They have referred to