According to the PMBOK® Guide, Analogous Estimating is a technique for estimating the duration or cost of an activity or a project using historical data from a similar activity or project. It is frequently used in the Estimate Costs and Estimate Activity Durations processes.

How it Works: It uses the values of parameters—such as scope, cost, budget, and duration—or measures of scale (size, weight, complexity) from a previous, similar project as the basis for estimating the same parameter or measure for a current project.

When to Use: It is generally used when there is a limited amount of detailed information about the project (e.g., in the early phases of a project).

Accuracy and Cost: Analogous estimating is generally less costly and time-consuming than other techniques, but it is also generally less accurate. It is most reliable when the previous projects are similar in fact and not just in appearance, and the project team members preparing the estimates have the needed expertise.

Top-Down Approach: This is often referred to as a " top-down " estimating technique because it looks at the project as a whole based on past performance rather than breaking it down into minute details.

Analysis of Other Options:

A. Estimates are created by individuals or groups with specialized knowledge: This describes Expert Judgment. While expert judgment is often used during analogous estimating to determine if a past project is a valid comparison, the definition of analogous estimating specifically hinges on the use of historical data from similar projects.

C. Estimates are created by analyzing data: This is a broad description of Data Analysis (such as Alternative Analysis or Reserve Analysis). While estimating involves data, it is not the specific definition of the analogous technique.

D. Estimates are created at the task level and aggregated upwards: This describes Bottom-Up Estimating, which is the opposite of analogous estimating. Bottom-up estimating is more detailed and accurate but requires a well-defined WBS.