CAPM (Certified Associate in Project Management) Practice Exam

What is forecasting used for in project management?

1. To track past performance

2. To estimate future project costs

3. To calculate current expenses

4. To award team performance

The correct answer is: To estimate future project costs

Forecasting in project management is used to estimate future project costs. By analyzing past performance and current trends, project managers can make educated predictions about the budget required for the completion of a project. This helps in effective project planning and budget allocation, ensuring that the project stays on track financially. Options A, C, and D are incorrect as forecasting is not primarily used for tracking past performance, calculating current expenses, or awarding team performance in project management. Although past performance can be a consideration in forecasting, the main purpose is to project and plan for future costs and requirements.