PK0-004 · Question #74
A senior manager asks a project manager for an estimated budget on a new project. Which of the following is the BEST step for the project manager to take?
The correct answer is B. Use the budget from a similar project to generate estimates. Using historical data from a similar past project is analogous estimating, the most practical early-stage technique when detailed information is not yet available.
Question
A senior manager asks a project manager for an estimated budget on a new project. Which of the following is the BEST step for the project manager to take?
Options
- ATell the senior manager the estimation is not available yet
- BUse the budget from a similar project to generate estimates.
- CAsk a SME for an opinion and propose an estimate.
- DGather the team to immediately generate estimates.
How the community answered
(31 responses)- A13% (4)
- B77% (24)
- C3% (1)
- D6% (2)
Why each option
Using historical data from a similar past project is analogous estimating, the most practical early-stage technique when detailed information is not yet available.
Telling the manager no estimate is available is unhelpful and ignores available historical information that could support an early estimate.
Analogous estimating (top-down estimating) leverages actual cost data from a comparable completed project as a basis for the new estimate. It is the recognized best practice for quickly producing a credible budget figure at the initiation phase before a full scope and WBS are defined, balancing speed with reasonable accuracy.
Seeking a single SME opinion produces an informal rough order of magnitude but lacks the structured basis that historical project data provides, making it less reliable.
Assembling the full team to generate detailed estimates is time-consuming and premature at the early request stage when high-level analogous data is sufficient.
Concept tested: Analogous estimating using historical project data
Topics
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