In a project similar to that in the case study example, relatively small unit cost changes are not likely to pose a significant risk to the project viability.

Question

BlackTom AI · Accepted Answer

Question restatement: The claim is that in a project similar to the case study example, relatively small unit cost changes are not likely to pose a significant risk to project viability.
Option 1: True. This would assert that small unit cost changes do not threaten viability. In practice, even modest cost fluctuations can accumulate across many components or phases, potentially affecting cash flows, profitability, and viability milestones, especially in tightly constrained budgets or high-uncertainty projects. Therefore this statement tends to overlook cumulative risk and sensitivity factors, making the claim unreliable.
Option 2: False. This choice accurately challenges the idea that small unit cost changes are harmless. The reasoning is that even minor cost variations can compound over time, impact contingency adequacy, and alter baseline forecasts. Risk analysis, margin erosion, and schedule pressures can all amplify the effect of small cost changes, leading to viability concerns in some scenarios.
To understand the nuance, consider that project viability depends on many interacting variables: cost estimates, contingency levels, funding availability, and schedule commitments. A seemingly small unit cost change, when multiplied across quantities or spread over multiple work packages, can become material. Hence, the statement that such changes are not likely to pose a significant risk is misleading, aligning with the assessment that the correct stance is that small unit cost changes can matter to viability, depending on context.

CVEN30008_2025_SM1 Module 5.1 Quiz

In a project similar to that in the case study example, relatively small unit cost changes are not likely to pose a significant risk to the project viability.

View Explanation

Log in for full answers

Similar Questions

TB MC Qu. 13-16 Which prescriptive analytics technique... Which prescriptive analytics technique predicts how changing one input will affect an outcome variable?

What is the name of a decision support tool that asks what-if questions repeatedly to predict outcomes in a variety of situations?

OK, forget about the above change to the cost of Jan-Apr internships. Suppose instead that the full cost of a May-Aug internship decreases by $2,396. What is the new total cost of this model? Hint: you should be able to answer this question using the sensitivity report.

Craig is a marketing manager for a construction supply company. If he queries his marketing databases to determine the effect of three different levels of price for a new product, he is using a(n)

If the profit/kg for Serano that goes into Boost decreases by $6, how much will the target cell decrease by?

More Practical Tools for Students Powered by AI Study Helper

Homework AI Solver

Stylized AI Paper Writer

Plagiarism Checker Assistant

Citation AI Academic Writing Tool

In-Class Translation Assistant

AI Note Generator

AI Quiz Answers

Past Exam Questions from University Test Bank

Smart Practice Assistant

Adaptive Practice

Making Your Study Simpler