Time andcost estimates are important to project management for the followingreasons:

• Estimatesare key inputs to project planning and control.
• Estimatessupport good decisions.
• Estimatesare used to determine project duration and cost.
• Estimatesare used to develop time-phased budgets and establish the projectbaseline.
• Withoutestimates you have inaccuracies, which result in time and costunder/overruns.

Mostproject tasks are unique and require the project manager to estimateduration/cost for each and every task separately; however, projectsmay also have repetitivetasks completed by the human resources assigned to the project. Toestimate the labor hours/cost for these tasks the project manager mayuse an estimating technique that relies on learning curve theory toestimate the time and/or cost for completing repetitive tasks.

Inthis assignment, you will:

Task #1.Define and thoroughly discuss the Learning Curve Theory and how itapplies to project management.

Task#2. Explain how you wouldapply the principles of the Learning Curve Theory to a real projectin which you are familiar (as a project manager, team member, or onethat you have read about in current events).

Task#3. Complete the followingexercise on learning curves (see Page 2 of this assignment).

Instructionsfor completing the assignment:

• Beforeyou begin this assignment, review the grading rubric for thisassignment to understand how your work will be graded.
• Searchout scholarly resources related to the subject of this assignment;use the UMUC online library databases as a start. You may also usethe PMI site as a resource.
• In MSWord, compose a paper of 300-400 words (approximately 1 page) thataddresses Task #1 and Task #2.
• Insertyour response to the Exercise on learning curves (Task #3) andinclude all supporting calculations.
• Formatyour assignment response in accordance with APA 6^thedition, include a title page and References page, and save the fileas PMAN634_IA5_yourlastname.
• Submityour assignment through the Assignment folder of the course no laterthan 11:59 p.m. on Sunday, Week 5.

EXERCISE:Using the concept of Learning Curves for Estimating consider thefollowing scenario and respond to each question (all work should beshown in your Word document):

Supposethat you are the assigning costs to a major project to be undertakenthis year by your firm, University Applications. One particularcoding process involves many labor-hours, but highly redundant work.You anticipate a total of 200,000 labor-hours to complete the firstiteration of the coding and a learning curve rate of 70%. You areattempting to estimate the cost of the twentieth iteration of thiscoding sequence.

Based onthis information and a $60 per hour labor rate, what would you expectto budget as

A. Thecost of the twentieth iteration?

B. Thecost of the fortieth iteration?