PMP Certification Training - Estimate Cost

The video tutorial covers the process of estimating project costs, highlighting the challenges and iterative nature of cost estimation. It discusses the inputs, tools, and techniques used, such as expert judgment, analogous and parametric estimating, and data analysis techniques. The tutorial also explains the importance of documenting assumptions and the basis of estimates, and emphasizes the need for accurate and current information.

What is the primary challenge in estimating project costs?

• Costs are fixed and do not change

• Having too much detailed information

• Projects always have a fixed price quote

• Costs evolve and change over time

Which document is crucial for determining the levels of accuracy in cost estimation?

• Project Schedule

• Cost Management Plan

• Lessons Learned Register

• Risk Register

What is analogous estimating primarily based on?

• Current market rates

• Statistical relationships

• Detailed project scope

• Expert judgment and historical data

Which estimating technique uses a statistical relationship to calculate estimates?

• Analogous Estimating

• Parametric Estimating

• Three-point Estimating

• Bottom-up Estimating

What does three-point estimating involve?

• Using only expert judgment

• Using three estimates: optimistic, pessimistic, and most likely

• Using historical data only

• Using a single estimate

What is the purpose of reserve analysis in cost estimation?

• To reduce project scope

• To increase project costs

• To monitor and manage project reserves

• To eliminate all project risks

What does the cost of quality include?

• Only appraisal costs

• Only prevention costs

• Costs for compliance and noncompliance with quality requirements

• Only costs for noncompliance

What is the role of voting in the cost estimation process?

• To determine project scope

• To engage team members and improve estimate accuracy

• To eliminate unnecessary costs

• To finalize the project budget

What should be recorded along with cost estimates?

• Only the project schedule

• Assumptions and the basis of estimates

• Only the final budget

• Only the risk register

Why is supporting documentation important in cost estimation?

• To provide a clear understanding of how the estimate was derived

• To finalize the project budget

• To increase project costs

• To reduce project scope