A project manager is analyzing the cost variances produced when comparing two different projects completions. Which of the following factors could be causing the increased variance for the…

The correct answer is D. Increased labor cost E. Increased labor overhead. Cost variance measures the difference between earned value and actual cost. For a four-month project compared to a shorter one, labor-related costs are the primary drivers of increased variance. (D) Increased labor cost directly raises actual expenditures beyond what was…

Project management concepts

Question

A project manager is analyzing the cost variances produced when comparing two different projects completions. Which of the following factors could be causing the increased variance for the four-month projects? (Select two.)

Options

AIncreased resource productivity
BIncreased resource allocation
CIncreased schedule variance
DIncreased labor cost
EIncreased labor overhead

How the community answered

(51 responses)

A
14% (7)
B
27% (14)
C
8% (4)
D
51% (26)

Explanation

Cost variance measures the difference between earned value and actual cost. For a four-month project compared to a shorter one, labor-related costs are the primary drivers of increased variance. (D) Increased labor cost directly raises actual expenditures beyond what was budgeted, widening the cost variance. (E) Increased labor overhead (benefits, taxes, facilities) compounds the effect over a longer timeframe. Increased resource productivity (A) would actually reduce variance by improving efficiency. Increased resource allocation (B) relates to scheduling, not directly to cost variance. Increased schedule variance (C) measures time performance, not cost, and is a different metric (SV, not CV).

Topics

#cost variance#labor cost#overhead#cost analysis

Community Discussion

No community discussion yet for this question.

Full PK0-004 Practice