PMP Referenced Question 13: Estimating Costs for Urgent Funding Using Proven Team Performance
This PMP-style scenario examines the correct choice of estimation method for submitting a project for urgent funding. The scenario involves a proven Scrum team and a critical project that introduces new technology.
📘 Scenario
A new project needs to be submitted for urgent funding approval. The project, which will use a new technology, is vital to the organization. The entire Scrum team has worked together for over 3 years on multiple projects and delivered the previous project under the approved budget.
❓ Question
Which estimation technique should the project manager implement in this context?
A. Definitive estimate
B. Order of magnitude
C. Budget estimate
D. Story points
⚠️ Disclaimer: This PMP-style question is presented for educational and commentary purposes only. It is not sourced from any official PMI exam and is not intended to violate any copyright. This content reflects interpretations based on the PMI mindset and principles, and is designed to help learners prepare for the PMP exam. If this question resembles real PMP exam content, it is coincidental and used solely under the doctrine of fair use for academic discussion. No claim of affiliation with or endorsement by PMI is made.
✅ Correct Answer: C. Budget estimate
⏱ A budget estimate is ideal when funding is needed quickly, but detailed specs are not finalized.
📉 Accuracy range: –10% to +25%, suitable for early approval with reasonable confidence.
🧠 The experienced team provides credibility for historical reference and realistic budgeting.
✔ Why Option C is Correct
The budget estimate strikes the right balance for this situation: it’s quick, informed by historical performance, and appropriate for submitting funding requests during early planning. PMI categorizes it as a mid-level estimate suitable for stakeholder decision-making.
🧮 Estimation Technique Comparison
Technique
Purpose
Accuracy
When Used
Order of Magnitude
Conceptual, very early
–25% to +75%
Project proposal / idea phase
Budget Estimate
Funding decisions, business case
–10% to +25%
Planning, before detailed scope
Definitive Estimate
Execution planning
–5% to +10%
When scope and details are known
Story Points
Relative effort (Agile only)
Not a cost estimate
Sprint planning / velocity tracking
✖ Why Other Options Are Incorrect
A. Definitive estimate → Too detailed; requires complete scope and design, not suitable for urgent approval.
B. Order of magnitude → Too rough (–25% to +75%) for a vital, high-priority project with an experienced team.
D. Story points → Used for relative effort estimation in Agile delivery, not for cost-based funding decisions.
📌 Key Takeaway
For early-stage but high-visibility projects requiring fast funding, PMI recommends budget estimates — especially when historical performance data supports them.
PMP candidates must distinguish between estimation techniques based on timing, accuracy, and purpose. Budget estimates are ideal for early funding decisions when urgency and moderate accuracy are required.
PMP Referenced Question 22: Validating Budget Inputs for Analogous Estimation This PMP-style scenario focuses on avoiding estimation errors when using historical projects as a baseline. PMI...
PMP Referenced Question 21: Rebaselining a Delayed Project Through Change Control This PMP-style scenario focuses on how a project manager should respond when a project is...
PMP Referenced Question 20: Resolving Sprint Failures Caused by Scope Volatility This PMP-style scenario focuses on the project manager’s role in facilitating Agile collaboration and backlog...
PMP Referenced Question 19: Supporting Team Members Through Knowledge Gaps This PMP-style scenario tests how a project manager should respond to a team member’s performance issue...
PMP Referenced Question 18: Empowering Contractors Under Tight Project Deadlines This PMP-style scenario highlights best practices in empowering contracted teams during urgent rollouts. PMI encourages clear...
