What does the "Velocity" of a team indicate in Agile practices?

In Agile practices, "Velocity" is a key metric that reflects the amount of work completed by a team during a sprint. It is typically quantified in terms of story points, work items, or other units that measure productive output. Understanding velocity allows teams to assess their performance and productivity over time, helping them to make informed decisions for future sprints, including workload planning and forecasting. Tracking velocity can also help the team identify improvements or inefficiencies in their processes.

The other options relate to different concepts in Agile project management. For instance, the time taken to complete a sprint is important but does not represent velocity, as velocity is specifically about output. The number of team members involved doesn’t provide information about productivity. Finally, the overall project budget is a concept that, while relevant in project management, does not pertain to the definition of velocity in the context of Agile practices.