Cost Estimating Approaches - 1
Various approaches are possible
- Depending on the time and data available
- This approach is "top down"
- Sometimes known as "Analogy Method"
- The estimate is based on comparing the project, or major system elements with data from a previous similar project
- Adjustments are made to account for obvious differences such as size, time, location, inflation, etc
- Results in an "Order of Magnitude" estimate
- Target range: -25% to +75% or higher