What is the cost estimating relationship?
Cost Estimating Relationships (CER) An algorithm relating the cost of an element to physical or functional characteristics of that cost element or a separate cost element; or relating the cost of one cost element to the cost of another element.
How do you calculate cost estimation?
To use parametric estimating, first divide a project into units of work. Then, you must determine the cost per unit, and then multiply the number of units by the cost per unit to estimate the total cost.
What is a cost estimating relationship or CER?
Cost Estimating Relationship or “CER” means a mathematical expression of varying degrees of complexity expressing cost as a function of one or more variables.
What are the 3 main methods of cost estimating?
Methods of Cost Estimation in Projects – Tools and Techniques
- Expert Judgement Method.
- Analogous Estimating Method.
- Parametric Estimating Method.
- Bottom-up Estimating Method.
- Three-Point Estimating Method.
- Data Analysis Method.
- Project Management Information System Method.
- Decision-Making Method.
Which estimating technique is most accurate?
The bottom-up estimating technique is also called the “definitive technique.” This is the most accurate cost estimation tool, but it consumes time and resources.
What are the basic types of cost estimating?
4 Project Cost Estimation Techniques
- Analogous Estimating. Through analogous estimating, a project manager calculates the expected costs of a project-based upon the known costs associated with a similar project that was completed in the past.
- Parametric Estimating.
- Bottom-Up Estimating.
- Three-Point Estimating.
What are different cost estimation techniques?
What are cost estimating ratios relationships )? How are they used?
Cost Estimating Relationship Definition. As the name implies, a cost estimating relationship (CER) is a technique used to estimate a particular cost or price by using an established relationship with an independent variable.
What is the estimated relationship?
Mathematical formula used in projecting a value based on other related variables. An example is projecting the cost of material consumed based on the number of hours worked and the number of workers involved. Grandparent Rights: Everything You Need To Know.
Which model is used for cost estimation?
Typical software cost estimation models are COCOMO (Barry Boehm) and GECOMO (GEC Software, UK), PRICE S (RCA), PROMPT Estimator (LBMS, UK), and SLIM (Putnam, Norden, Rayleigh model, software from QSM Inc, US). The models make no apportionment of costs to different life-cycle phases, and generally give cost to deliver.
When do you use a cost estimating relationship?
A cost estimating relationship (CER) is a technique used to estimate a particular cost or price by using an established relationship with an independent variable.
How does a cost estimator choose a method?
The cost estimator must select the most appropriate cost estimating methodology (or combination of methodologies) for the data available to develop a high quality cost estimate.
When to use a CER in a cost estimate?
If you can identify an independent variable (driver) that demonstrates a measurable relationship with contract cost or price, you can develop a CER. Many contractors develop and use CERs in their cost estimates to avoid the time consuming necessity to prepare discrete estimates for every cost.
How is the analogy method used in cost estimating?
The type of cost estimating method used will depend on the adequacy of Project/Program definition, level of detail required, availability of data, and time constraints. The analogy method finds the cost of a similar space system, adjusts for differences, and estimates the cost of the new space system.