Project Planning and Estimating Flashcards

A project manager for a new highway interchange is developing a preliminary cost estimate. Detailed plans are not yet available, but a similar interchange was built in an adjacent county two years ago. The manager uses the final cost of the previous project, adjusted for inflation and a 15% increase in size, to estimate the new project's cost. Which estimating technique is being used?

Answer: Analogous Estimating

Analogous estimating uses historical data from a similar past project as the basis for estimating the cost or duration of a current project. It is a form of expert judgment and is generally less accurate but quicker than other methods. In this scenario, the manager is using a single, similar past project as the direct basis for the new estimate.

In a critical path method (CPM) network diagram for a bridge construction project, an activity has an early start (ES) of day 10, a late start (LS) of day 15, an early finish (EF) of day 20, and a late finish (LF) of day 25. What is the total float for this activity?

Answer: 5 days

Total float is the amount of time that a schedule activity can be delayed without delaying the project finish date. It is calculated as the difference between the late start and early start (LS - ES) or the late finish and early finish (LF - EF). In this case, Float = 15 - 10 = 5 days, or Float = 25 - 20 = 5 days. Activities on the critical path have zero float.

A project is midway through its schedule. The Planned Value (PV) is $500,000, the Earned Value (EV) is $450,000, and the Actual Cost (AC) is $480,000. Which of the following statements accurately describes the project's status?

Answer: The project is behind schedule and over budget.

Schedule Variance (SV) = EV - PV = $450k - $500k = -$50k. A negative SV indicates the project is behind schedule. Cost Variance (CV) = EV - AC = $450k - $480k = -$30k. A negative CV indicates the project is over budget. Therefore, the project is both behind schedule and over budget.

Which of the following is the primary purpose of creating a Work Breakdown Structure (WBS) in project planning?

Answer: To define the total scope of the project by breaking it down into smaller, manageable components.

The Work Breakdown Structure (WBS) is a foundational project management tool used to define and organize the total scope of a project. It is a hierarchical decomposition of the project into smaller, more manageable deliverables or work packages. The WBS ensures that all required work is identified and serves as the basis for subsequent planning activities like scheduling, cost estimating, and resource allocation.

A project manager is facing a situation where several key engineering staff are overallocated across multiple concurrent tasks. The project has a fixed, non-negotiable completion date. Which resource optimization technique would be most appropriate to use?

Answer: Resource Smoothing

Resource smoothing is used to optimize resources when the project completion date is fixed. It adjusts activities within their available float to balance resource demand, avoiding peaks and troughs without changing the critical path or extending the project duration. Resource leveling, in contrast, can extend the project schedule to resolve resource over-allocations.

During the budgeting phase of a large-scale dam construction project, the project manager adds a specific monetary amount to the cost baseline to account for the potential impact of a well-identified risk of encountering unexpectedly hard rock formations. This budget allocation is best described as a:

Answer: Contingency Reserve

A Contingency Reserve is an amount of money or time added to the project's baseline to address the impact of identified risks, or 'known-unknowns'. Since the risk of hard rock formations is identified, the funds allocated to mitigate its potential cost impact are a contingency reserve. A Management Reserve is for 'unknown-unknowns'—risks that were not identified.