When Resources Such as Overtime, Extra Equipment, and Additional Staff

question 20

Multiple Choice

When resources such as overtime, extra equipment, and additional staff result in higher costs, what should a project manager do?

• A)Hire additional staff and acquire additional resources.
• B)Terminate the project.
• C)Make a tradeoff between the extra costs associated with crashing and the benefits of a reduced project completion time.
• D)Look for a new sponsor of the project.
• E)Delay the project until economic conditions change.

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Definitions:

Relevant Range

The range of activity or volume over which the assumptions about cost behavior are valid.

Cost Driver

Any factor which causes a change in the cost of an activity, influencing the costs of business operations directly.

High-low Method

An approach used in cost accounting to estimate fixed and variable costs based on the highest and lowest levels of activity.

Electricity Cost

The amount charged for the consumption of electric power, which can vary based on factors like usage, time of use, and geographical location.