Use Cost of Delay to decide which project to start first

What's really being asked

This question tests whether you treat prioritization as a sequencing problem with an economic burn rate rather than a simple comparison of project values. Interviewers want to see if you understand that the cost of delay is an ongoing cost measured per unit of time, and that the order in which you build projects changes the total value captured. They are looking for comfort with quantitative trade-offs and the ability to explain why a smaller absolute project might deserve the front of the queue.

The full answer

A strong answer walks through four things in order. First, define Cost of Delay as the economic value lost per month by not completing a project, calculated by dividing the monthly value by the project duration. Second, compute the numbers for both projects, showing Project A at 10,000 divided by 4 months equals 2,500 per month, and Project B at 5,000 divided by 1 month equals 5,000 per month. Third, explicitly state that because Project B's cost of delay is higher, every month you wait on B costs the organization twice as much as waiting on A. Fourth, recommend starting Project B first, then Project A, and note that over a five month horizon this sequence captures more total value than doing A first.

The mistakes people make

The biggest red flag is choosing Project A solely because 10,000 is larger than 5,000, which ignores the time dimension entirely. Another weak pattern is invoking the "quick win" or "low hanging fruit" rationale without calculating the actual burn rate, since that is just intuition dressed as strategy. Some candidates will calculate net present value or payback period but fail to compare the cost of delaying one project while the other is being built, which is the core insight. A subtle miss is saying you would do both in parallel without acknowledging that the prompt assumes you can only work on one at a time.

What usually comes next

An interviewer might push back by asking what happens if Project A carries significant operational risk or maintenance burden that grows over time. They could also ask how you would incorporate a confidence interval if the revenue projections were uncertain, or how Weighted Shortest Job First would change the calculation if you added a weighting factor for strategic alignment. Another common follow-up is to ask how you would communicate this decision to a stakeholder who is emotionally invested in the cost savings of Project A.

A concrete example

If you start Project B first, you finish it in month 1 and begin capturing 5,000 per month immediately while you build Project A for the next four months. By the end of month 5, you have captured five months of Project B revenue at 5,000 per month for 25,000 total, plus one month of Project A savings at 10,000, giving 35,000 in value captured. If you start Project A first, you capture nothing until month 4, then get one month of B revenue by month 5, yielding only 5,000 plus 10,000 for 15,000 total. The sequencing gap is $20,000 over five months, which makes the priority clear.