What Is Guesstimating? Why Should a Project Manager Not Rely

question 41

Essay

What is guesstimating? Why should a project manager not rely on this technique for estimating a project?

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Definitions:

Capital Goods

Long-term assets such as machinery, buildings, and equipment purchased by businesses to produce goods and services.

Production Possibility Frontier

A curve depicting all maximum output possibilities for two or more goods given a set of inputs, assuming full and efficient utilization of resources.

Opportunity Cost

The exclusion of favorable outcomes from different choices upon selecting one option.

Increasing Opportunity Cost

A scenario where choosing more of one option increasingly limits the ability to choose other options, demonstrating the trade-offs in resource allocation.