Wednesday, 10 July 2013

cost estimates

cost estimates

An approximation of the probable cost of a product, program, or project, computed on the basis of available information.
Four common types of cost estimates are
: (1) Planning estimate: a rough approximation of cost within a reasonable range of values, prepared for information purposes only. Also called ball park estimate.
 (2) Budget estimate: an approximation based on well-defined (but preliminary) cost data and established ground rules.
(3) Firm estimate: a figure based on cost data sound enough for entering into a binding contract.
 (4) Not-to-exceed /Not-less-than estimate: the maximum or minimum amount required to accomplish a given task, based on a firm cost estimate.

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