PK0-004 · Question #386
Which of the following describes a project's budget overrun?
The correct answer is D. The project spends in excess of the funds. A budget overrun (also called cost overrun) occurs when a project's actual expenditures exceed the approved budget allocation. This means more money was spent than was authorized. Option A (spending only half) describes an underspend or cost savings. Option B (spending only the…
Question
Which of the following describes a project's budget overrun?
Options
- AThe project spends only half of the funds.
- BThe project spends only the allocated funds.
- CThe project spends none of the funds.
- DThe project spends in excess of the funds.
How the community answered
(30 responses)- B3% (1)
- C3% (1)
- D93% (28)
Explanation
A budget overrun (also called cost overrun) occurs when a project's actual expenditures exceed the approved budget allocation. This means more money was spent than was authorized. Option A (spending only half) describes an underspend or cost savings. Option B (spending only the allocated funds) describes perfect budget adherence. Option C (spending none of the funds) would indicate either project cancellation or complete non-execution. Only Option D - spending in excess of the allocated funds - correctly defines a budget overrun, resulting in a negative cost variance (CV < 0) in earned value terms.
Topics
Community Discussion
No community discussion yet for this question.