AACE International PSP Exam With Confidence Using Practice Dumps

 Cost for 2000 Series Activities:

Activity 2001: $150,000.

Activity 2002: $25,000.

Activity 2003: $18,000.

Activity 2004: $96,000.

Total: 150,000+25,000+18,000+96,000=289,000150,000 + 25,000 + 18,000 + 96,000 = 289,000150,000+25,000+18,000+96,000=289,000.

 Total Project Cost:

Total cost: $7,308,000 (sum of all activities in "normal" schedule).

 Percentage Contribution:

289,0007,308,000×100≈3.95%\frac{289,000}{7,308,000} \times 100 \approx 3.95\%7,308,000289,000​×100≈3.95%.

 Verification with PSP Guidelines:

The PSP Study Guide emphasizes accuracy in percentage-based cost contributions as a critical analysis tool in project cost management (Ref: PSP Study Guide, Chapter 1B: Cost Breakdown Structure).

 Impact of Scope Definition on Cost Overruns:

Poor scope definition leads to unrealistic budgets and unforeseen changes, which significantly contribute to cost overruns.

Other factors like change management and WBS definitions are secondary contributors compared to scope inadequacy.

 PSP Study Guide References:

The guide emphasizes scope definition as a critical factor for accurate budgeting and planning​.

 Conclusion: The correct answer is D, as scope definition at the estimate stage has the most frequent and significant impact on cost overruns.

The sum of all budgets for work scheduled to be accomplished within a specific time period is referred to as the Budgeted Cost of Work Scheduled (BCWS). It represents the planned value of work to be performed during the reporting period.

Option A (Estimate at Completion - EAC) refers to the projected final cost of the project.

Option B (Budget at Completion - BAC) is the total project budget.

Option C (Budgeted Cost of Work Performed - BCWP) refers to the earned value.

This definition aligns with earned value management concepts covered in the PSP Study Guide​.