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Test 2 Chap 7

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Question
Answer
If a project budget is over funded, it will often __________.   produce waste and encourage slack management  
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Identify the statement that is not correct regarding a project budget.   The budget is not an expression of organizational policy  
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In order to develop a budget, the PM must forecast __________.   All of the above (the resources required, when resources will be needed, the cost of resources)  
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The traditional organizational budget is __________.   category-oriented  
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The authors identify __________ estimation errors as the two types of generic estimation errors.   random and systematic  
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The pattern of deviations in cost and usage used for exception reporting to management is called __________.   variances  
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__________ costs vary with output.   Direct  
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Unless the project manager is familiar with the firm’s __________ it will be very difficult to exercise budget control.   accounting system  
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The __________ form of budgeting has the advantage of using individuals closer to the work to provide estimates of resource requirements.   bottom-up budgeting  
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A possible reason for the poor record of project cost overruns is __________.   all of the above (scope creep, optimistic estimates, unaware of some costs)  
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Created by: bmarietto