Ch.5, Instructor Responses 1. Why are accurate estimates critical to effective project management? Without accurate time and cost estimates project control is ineffective. Inaccurate estimates can make the difference between profit and loss. • Time and cost estimates are major inputs to project planning. • Project control is completely dependent on accuracy of estimates. • Estimates are needed to support good decisions. • Estimates are used to determine project duration and cost. • Estimates are used to develop cash flow needs. • Estimates are used to develop time-phased budgets and establish the project baseline. • Absence of estimates results in inaccuracies which result in time and cost under/overruns. • The activity of estimating reduces error. 3. What are the differences between bottom-up and top-down estimating approaches? Under what conditions would you prefer one over the other? Top-down estimates are typically used in the project conceptual phase, and depend on
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