Question

A prime contractor in a customer project under CPFF contract has run into unexpected technical problems. Fixing them will require a lot of additional work to be done.


The company made a decision to book more staff and equipment from their subcontractors in order to adhere to the agreed timeline. The customer agreed to this decision.


What will most likely happen?
   
  aThe contractor‘s indirect costs will increase and the customer‘s payment for them will increase, too.
  b The contractor‘s indirect costs will increase but the customer‘s payment for them will not increase.
  c The contractor‘s indirect costs will not increase but the customer‘s payment for them will.
  d Neither the contractor's indirect costs nor the customer‘s payment for them will increase 


In order to speed up a project, you made a decision to fast-track a phase currently performed with five team members and another one which was planned to begin in four weeks time with another five team members.
Which of the following activities should you do first?
 
 
  a. Make sure that all exit criteria of the consecutive phase have been met to ensure the flow of communications in a team situation which is more complex by a factor of 2.
 b.  Make sure that all entry criteria of the previous phase have been met by planning and performing a phase gate meeting to assess technical aptness.
 c.  Make sure that all exit criteria of the previous phase have been met by planning and performing a phase gate meeting to assess technical performance.
 d.  Restructure your team and delegate tasks in order to ensure the flow of communications in a team with the number of communication channels increased by a factor of 4.5. 

 


 


Pls explain the answer, thanks in advance

Q1.  Choice D.  Labor & equipment needed to execute the project are direct costs associated with the project - not indirect costs.  Utilities, rent etc can be classified under indirect costs.  Here Direct costs will increase but none of the choices discuss this.  The question is to assess whether the student can distinguish between these 2 types of costs.

Q2.  I will go with Option C.

 

Chandra

For Q1..I agree with the explanation to the first part that it is an indirect cost but why will the customer's payment not increase? Isnt the seller paid for all allowable costs for performing the contract work. So seller should be paid for all the increased costs also since the customer agreed to it.


Any explanations?? Pls help.