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Questions and Answers
Which of the following best defines cost overrun?
Which of the following best defines cost overrun?
- The percentage or dollar amount by which actual costs are equal to estimates
- The additional percentage or dollar amount by which actual costs exceed estimates (correct)
- The percentage or dollar amount by which actual costs meet estimates
- The percentage or dollar amount by which actual costs fall short of estimates
What did a 2011 Harvard Business Review study find about IT project cost overruns?
What did a 2011 Harvard Business Review study find about IT project cost overruns?
- An average cost overrun of 5 percent
- An average cost overrun of 50 percent
- An average cost overrun of 10 percent
- An average cost overrun of 27 percent (correct)
What did the Harvard Business Review study discover about IT project cost overruns?
What did the Harvard Business Review study discover about IT project cost overruns?
- A large number of predictable overages
- A large number of underestimations
- A large number of small overages
- A large number of gigantic overages or 'black swans' (correct)
What is the track record of IT projects in meeting budget goals?
What is the track record of IT projects in meeting budget goals?
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What is a 'black swan' in the context of IT project cost overruns?
What is a 'black swan' in the context of IT project cost overruns?
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Study Notes
Cost Overrun
- Cost overrun refers to a situation where the actual cost of a project exceeds its planned or budgeted cost.
IT Project Cost Overruns
- A 2011 Harvard Business Review study found that 1 in 6 IT projects experience a cost overrun of 200% or more on average.
- The study discovered that IT projects have a poor track record in meeting budget goals, with median cost overruns of 27% and schedule overruns of 29%.
Black Swan
- In the context of IT project cost overruns, a 'black swan' refers to a rare and unpredictable event that has a significant impact on the project's cost and timeline.
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Description
Test your knowledge about project cost management with this quiz based on Chapter 7 of the book "Information Technology Project Management, Ninth Edition." Explore key concepts and techniques used in managing project costs.
