Cost Estimating: Definition
This chapter is just an introduction to the subject.
It starts by defining the words “cost” and “price”, as they cover different concepts, even if they are so often mixed.
It then adds a few comments about the definitions of cost, as this is the subject of this book.
the relative costs of the projects alternatives should be correct,
their level should be realistic.
We rapidly then mention the three different project phases, from the cost analyst’s point of view. These phases have different objectives and require different tools.
The conclusion of this chapter is what can be called the “fundamental theorem about forecasting”. It will be our Ariane thread in this book.
A few comments are eventually made on the word “parametric”.
KeywordsCost Estimate Cost Estimator Human Effort Cost Accounting Decision Phase
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