Cost estimation methods

Question 1

Expert judgement

Answer 1

Expert judgment is also used in other methods as Reserve, group decision-makin techniques and analogous cos estimation.

Expert judgment is basically someone that provides valuable insight.

The gut feeling/intuition of someone who is experienced.

Question 2

Analogous estimating

Answer 2

Also called top-down estimating

This method uses the actual cost of a previous, similar project as the basis for estimating the cost of the current project.

Analogous cost estimating uses historical information and expert judgment.

Generally less costly and less time consuming than other techniques, but also less accurate.

The downside of using this techniques is that it estimates based on only one historical point, which may not be representive of the problem being addressed.

Question 3

Parametric estimating

Answer 3

Uses a statistical relationship between relevant historical data and other variables to calculate a cost estimate for project work.

Question 4

Bottom-Up Estimating

Answer 4

WBS

Question 5

Three-Point Estimating

Question 6

Reserve Analysis

Question 7

Cost of Quality

Answer 7

Don’t need this fucker

Question 8

Project Management Software

Answer 8

Don’t need this fucker

Question 9

Vendor Bid Analysis

Answer 9

Don’t need this fucker

Question 10

Group Decision-Making Techniques

Answer 10

Don’t need this fucker

Question 11

What is the Analogous cost estimation equation?

Answer 11

Cost of new project = (Cost driver new project/cost driver old project) * Cost of old project

y_2 = (x_2/x_1)*y_1