Task 6 Plan and Manage Finance PMP Practice Questions (Page 7)

Questions 31–32

1. 31foundation · easy

   What is the purpose of monitoring financial variations?

   • ATo define the content of financial reports
   • BTo quantify risks for contingency reserves
   • CTo allocate contingency funds to specific risks
   • DTo track and analyze variances between planned and actual financial performance to detect deviations early
   Reveal Solution Discussion Select an answer first
2. 32application · medium

   A software project has identified two key risks: a third-party API may become unavailable (30% probability, $50,000 impact) and a key developer may leave (10% probability, $200,000 impact). The project manager needs to set aside contingency reserves. According to best practice, what is the most appropriate contingency amount?

   • A$35,000, calculated as the sum of expected values (0.3 × $50,000 + 0.1 × $200,000).
   • B$15,000, only for the API risk, because the developer leaving is unlikely.
   • C$250,000, the sum of both risk impacts, to be fully prepared.
   • D$50,000, the larger single risk impact, to cover the worst case.
   Reveal Solution Discussion Select an answer first