Cost Estimation: Flashcards
Cost estimation is a blend of ___ and ____.
Art, Science
True or False: a high degree of accuracy is attainable without much effort
False
Factors that affect cost estimation?
Optimism
Marketing
Blaming/Killing the messenger
Scoping of requirements
Ways to get better cost estimates:
- Study lessons learned
- insist on estimation integrity
- Analyse cost early on
- Define project better
Cost Estimation Methods:
- Bottom up analysis
- Analogous Estimating
- Parametric Esimating
Estimation Method: Bottom up Analysis
estimate based on material/labor costs
not appropriate for conceptual design phase
Estimation Method: Analogous
Experience based approach (heuristic)
based on similar products
can be applied at any level
Not flexible during trade studies due to limited past cases
Estimation Method: Parametric
Based on CERs (Cost Estimation Formulas)
Can apply complexity factor for changing tech
Accounts for hardware dev
Cost Estimation methods with appropriate lifecycle phase:
Pre A & A - Parametric
B - Any method
C - Bottom up (detailed)
D - Bottom up (detailed)
True or False: Use of the detailed cost estimation method increase over project maturity.
True
True of False: Use of the parametric cost estimation method increases over project maturity.
False
Pros & Cons: Parametric Estimation
Pros:
- less time consuming
- more effective for what ifs
- More consistent estimates
- Traceable to past space systmes
Cons:
- applicable to set range of historical data
- Must adjust CERs for new technology an shit
- Usually not accurate for later phases in project
CER
Cost Estimate Formula:
We fit curves to data points between some measured parameter (weight/volume) and associated cost
We should ____ historical data to account for gradual inflation over time when using the parametric estimation method.
Normalize/Adjust/Account for
The ‘complexity factor’ for a CER ______ with the increase in component design changes.
Complexity
CER Complexity Factor:
Used to adjust CER for unique features unaccounted for in historical data.
What is the learning curve for cost estimation?
The idea that we learn how to use less resources and do things faster with each iteration of a design.
Formulae: Learning Curve
Y = k*x^n Y - production effort unit (hours,$) k - first unit effort x - number of units n - learning factor (percentage)
The learning curve factor for aerospace projects is approximately ____ %.
85%
Cost estimates include ____ aspects of mission effort
All
Multi-System Wraps:
costs incurred when integrating subsystems
Cost distributions skewed to the right are ____ costly.
More
Cost distributions skewed to the left are ____ costly.
Less
The _____ _____ _____ is a method used to sum cost distributions.
Monte Carlo Simulation
What does an “S-Curve” show?
The cost risk relationship
The ______ is a result of the statistical summation of cost distributions.
S-Curve
An S-Curve shows _____ that a project will cost an estimated amount or less.
Confidence
We want the S-Curve to track to the ____ as the project matures.
Left: results in higher probability of lower cost.
What is cost phasing?
Spreading the estimated cost over the design phases, years, or other time metric.
Complex, single copy, projects have a ___, ___ skewed BETA curve. (left, right, even short, tall)
Tall, Left
Complex, multiple copy, projects have ____, ____ skewed BETA curve. (left, right, even short, tall)
Tall, Even
Simple, single copy, projects have ____, ____ skewed BETA curve. (left, right, even short, tall)
Short, Even
Simple, multiple copy, projects have ____, ____ skewed BETA curve. (left, right, even short, tall)
Tall, Right
A beta curve shows the relationship between ____ and ______
Cost and time
True or False: wraps cost 33% of project
True
True or False: 75% of recurring cost is incurred by the CDR.
False.
75% of non-recurring by CDR
