What type of reserves are allocated for specific work packages and managed by the project team?

The correct answer focuses on the term used to describe funds set aside for specific work packages that are effectively managed by the project team. Such reserves are part of the overall project budget and are intended to address identified risks associated with particular tasks or deliverables. Contingency reserves are earmarked specifically for unforeseen risks that may arise during the project but are not tied to specific work packages in the same way that budget reserves are.

Budget reserves are typically allocated at the project level and designated for use by the team as needed for specific components of the project, allowing for flexibility in the execution phase. These reserves are planned in advance and fall within the purview of the project management team, ensuring that the project remains on track, even if adjustments are necessary. This ensures that teams can proactively manage their finances and resources, enhancing their ability to deliver on commitments without significant delays or overruns.

In contrast, management reserves are typically held by upper management to cover unforeseen risks that are broader and not associated with specific work packages. Therefore, they are not directly managed by the project team in the same way budget reserves are.