Practice Quiz

PMI PMP Project Management

Category - Cost Management

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Tom has drawn up an estimate for his project that he’s projected is accurate within 40 to 60 percent of actual cost. This type of estimate is classified as:
  1. Definitive
  2. Rough Order of Magnanimity
  3. Rough Order of Magnitude
  4. One helluva guess
  5. Analogous estimate
Explanation
Answer: c - Although we might venture to say d, Rough Order of Magnitude is the right answer, typically falling within the -50 to 100 percent of the actual. Definitive estimates fall within -5 to +10 percent of actual. Rough Order of Magnanimity is non-sensical.

Key Takeaway: The Rough Order of Magnitude Estimate is one made early in the project. As the project details emerge, the project manager should quickly be able to revise these towards the definitive range.
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