What is a specific advantage of analogous estimating in comparison with other cost estimate techniques?

Question

Options

• AUses contingency reserves
• BLess costly and time consuming
• CCan be applied to segments of work
• DMore accurate

• A
  9% (3)
• B
  74% (26)
• C
  3% (1)
• D
  14% (5)

Explanation

Analogous estimating uses historical data from similar past projects to quickly produce a rough cost estimate, making it the least costly and time-consuming technique - it requires minimal detail and can be done early in a project when little information is available (B is correct).

Why the distractors are wrong:

• A (Uses contingency reserves): Contingency reserves are a risk budgeting concept applied across all estimating techniques, not a distinguishing advantage of analogous estimating specifically.
• C (Can be applied to segments of work): This describes parametric estimating (and to some extent bottom-up), which scales unit costs across work packages. Analogous estimating is typically applied at a high/project level, not granular segments.
• D (More accurate): The opposite is true - analogous estimating is the least accurate technique. Bottom-up estimating is the most accurate because it builds from detailed, granular work packages.

Memory tip: Think of "analogous" as "analogize to the past" - you're quickly borrowing from history, which costs you little time but also gives you less precision. On exams, whenever you see "quick, cheap, early, or high-level," think analogous; whenever you see "accurate or detailed," think bottom-up.

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