Certified Business Analysis Professional (CBAP) — Question 426

You are the business analyst for your organization and are working with Sally, a project manager, for your organization. You and Sally are determining the cost of the labor, materials, equipment, and facilities in order to achieve the different solutions that have been proposed for an identified problem.
What is this process called?

Answer options

• A. Cost budgeting
• B. Expert judgment
• C. Rough order of magnitude cost estimating
• D. Scoping the project costs

Correct answer: C

Explanation

The correct answer is C, as a Rough Order of Magnitude (ROM) cost estimate provides an early approximation of project costs based on limited information. Option A, Cost budgeting, refers to the process of allocating the overall budget rather than estimating costs early on. Option B, Expert judgment, involves relying on the experience of experts for decision-making, and Option D, Scoping the project costs, pertains to defining what costs will be included, rather than estimating them.