Question 1) Cert Associate in Project Management
Objective: Project Initiating
SubObjective: Develop Preliminary Project Scope Statement
Single Answer Multiple Choice
Which type of cost estimate would MOST likely be used early in the Develop Preliminary Project Scope Statement process?
A. budget
B. detailed
C. definitive
D. order of magnitude
Answer:
D. order of magnitude
Tutorial:
An order of magnitude cost estimate would most likely be used early in the Develop Preliminary Project Scope Statement process. An order of magnitude estimate is an approximation that is made without detailed data. An order of magnitude estimate has an accuracy of -25% and 75%. An order of magnitude estimate would most likely be used to create a ballpark estimate because it is the easiest to create.
A budget estimate would not likely be used early in the Develop Preliminary Project Scope Statement process because it would require more detail to create. A budget estimate has an accuracy of between -10% and 25%.
A detailed estimate would not likely be used early in the Develop Preliminary Project Scope Statement process because it would require more detail to create than would be available. A detailed estimate is created from well-defined specifications. A detailed estimate, also referred to as a definitive estimate, is typically created using a bottom-up estimating technique.
A definitive estimate would not likely be used early in the Develop Preliminary Project Scope Statement process because it would require more detail to create than would be available. A definitive estimate is created from well-defined specifications. A definitive estimate is typically created using a bottom-up estimating technique. A definitive estimate has an accuracy of between -5% and 10%.
Reference:
1. A Guide to the Project Management Body of Knowledge – PMBOK Guide 3rd Edition – Project Integration Management – 4.2 Develop Preliminary Project Scope Statement
2. A Guide to the Project Management Body of Knowledge – PMBOK Guide 3rd Edition – Project Cost Management – 7.1 Cost Estimating
These questions are derived from the Self Test Software Practice Test for PMI exam #CAPM3ED – Certified Associate in Project Management, Third Edition
