Construction Cost Estimation
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Questions and Answers

Which estimating method involves pricing each activity individually and then combining them?

  • Historical Estimate
  • Plinth Area Estimate
  • Bottom-Up Estimate (correct)
  • Parametric Estimate

    • What is the basis of a historical estimate?

  • Costs from a similar past project (correct)
  • Expert opinions on future costs
  • Current market prices of materials
  • A standard installation factor

    • Which type of estimate uses the area covered by the external dimensions of a building?

  • Bottom Up Estimate
  • Equipment Factored Estimate
  • Plinth Area Estimate (correct)
  • Three Point Estimate

    • What is the basis of an equipment factored estimate?

    <p>Cost of the equipment (A)</p> Signup and view all the answers

    What three scenarios are considered in a three-point estimate?

    <p>Optimistic, most likely, pessimistic (B)</p> Signup and view all the answers

    What is the primary function of construction estimates?

    <p>To predict the cost of a construction project. (A)</p> Signup and view all the answers

    During which project phase is a preliminary cost estimate typically used?

    <p>During the early phases of a project. (D)</p> Signup and view all the answers

    What is another name for a preliminary cost estimate?

    <p>Abstract cost estimate (A)</p> Signup and view all the answers

    What does a detailed estimate involve?

    <p>Breaking down the project scope into smaller, individually priced units. (A)</p> Signup and view all the answers

    What main components are included in a detailed estimate?

    <p>Costs for materials, equipment, and labor. (C)</p> Signup and view all the answers

    What is the basis of a quantity cost estimate?

    <p>Based on the actual quantity of work that needs to be provided. (B)</p> Signup and view all the answers

    What is typically assumed in a quantity cost estimate?

    <p>A standard cost for each unit of work and materials. (A)</p> Signup and view all the answers

    What additional components are included in a bid cost estimate, beyond the contractor’s direct project costs?

    <p>Overhead costs and profit margin. (D)</p> Signup and view all the answers

    What is the purpose of a control cost estimate?

    <p>Monitoring the project during construction. (B)</p> Signup and view all the answers

    Which of these is a component that contractors consider when preparing an estimate?

    <p>Estimating technique (A)</p> Signup and view all the answers

    What is a top-down estimate?

    <p>An estimate created by distributing the total estimated cost to each task. (A)</p> Signup and view all the answers

    Which estimating technique is considered the most detailed and accurate?

    <p>Bottom-up estimate (D)</p> Signup and view all the answers

    What primarily influences the accuracy of a construction estimate?

    <p>The amount of information provided in the design documents. (C)</p> Signup and view all the answers

    What is a parametric estimate based on?

    <p>Unit costs from third-party data or in-house data. (B)</p> Signup and view all the answers

    What does an analogous estimate rely on?

    <p>Comparison to similar completed projects. (A)</p> Signup and view all the answers

    What does direct construction cost include in a parametric estimate data source?

    <p>Materials and quantity of work (B)</p> Signup and view all the answers

    Flashcards

    Purpose of Construction Estimate

    To predict the cost of a construction project and assist in feasibility and scope determination.

    Preliminary Cost Estimation

    An early estimate used before design is completed to determine if a project will proceed.

    Detailed Estimate

    Breaks down project costs into unit prices, requiring completed design documents for accuracy.

    Quantity Cost Estimate

    Estimates based on the number of work units, summing individual costs from quantified pieces.

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    Bid Cost Estimate

    Cost estimate submitted to a client to secure a contract, including overhead and profit margin.

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    Types of Construction Estimates

    Five main types used at different project lifecycle stages to establish costs accurately.

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    Abstract Cost Estimate

    Another term for a preliminary estimate used in early project phases without completed designs.

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    Total Project Cost

    The sum of all costs from a detailed estimate, including materials, labor, and equipment.

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    Historical Estimate

    An estimate based on past project costs adjusted for inflation.

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    Parametric Estimate

    A cost estimate calculated using standard rates and simple calculations.

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    Plinth Area Estimate

    An estimate based on the area covered by a building's external dimensions multiplied by a rate.

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    Bottom-Up Estimate

    An estimate where each project activity is priced individually and summed.

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    Three Point Estimate

    An estimate based on the average of optimistic, most likely, and pessimistic cost scenarios.

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    Control Cost Estimate

    A cost estimate for monitoring project finances during construction.

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    Estimating Technique

    Methods used to create cost estimates: top-down and bottom-up.

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    Top-Down Estimate

    Estimates the total project cost and distributes to tasks.

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    Accuracy of Cost Estimates

    Depends on the amount of design information provided.

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    Magnitude Estimate

    An early estimate based on minimal design information.

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    Expert Judgment

    Cost estimate based on opinion of a building expert.

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    Study Notes

    Construction Estimates

    • Construction estimates are calculations predicting the cost of a construction project.
    • These estimates are also valuable for project planners to check feasibility and the scope of the project.

    Types of Construction Estimates

    • There are five main types, each used at different stages of a project's lifecycle.

    1. Preliminary Cost Estimation

    • Also called abstract cost estimate, approximate cost or budget estimate.
    • Used in early project phases, often before design documents are finalized.
    • Helps determine if a project is worth pursuing before significant time investment.

    2. Detailed Estimate

    • Breaks down the project scope into smaller, individually priced units.
    • Includes costs for materials, equipment, and labor to get a total project cost.
    • Requires a complete project design for accurate quantification of work.

    3. Quantity Cost Estimate

    • Based on the actual number of units or amount of work required.
    • Breaks down the project into quantifiable units and adds up the costs for each.
    • Assumes standard costs for each unit of work and materials.
    • Typically quantified via takeoff.

    4. Bid Cost Estimate

    • The cost estimate submitted to potential clients.
    • Includes all contractor costs, overhead costs, and profit margin, used as a proposal for winning the job.

    5. Control Cost Estimate

    • Used to monitor the project during construction.
    • Consists of three estimates: financing budget, budget after contracting but before construction, and estimated cost to complete.
    • Regularly revised to reflect approved customer changes and actual costs.

    Components of Construction Estimates

    • Estimating technique, accuracy, and data source are key components.

    1. Estimating Technique

    • Two methods: top-down and bottom-up.
    • Top-down determines the overall project cost and allocates to tasks based on that cost.
    • Bottom-up prices each task individually, summing up to the overall cost. Bottom-up is the most accurate method, often using takeoff software.

    2. Accuracy of Cost Estimates

    • Accuracy depends on the information provided in the design documents.
    • Estimates become progressively more accurate as project development advances.
    • Different levels of estimates exist, like magnitude, feasibility, preliminary, and definitive estimates.

    3. Data Sources for Estimated Cost Estimates

    • Three potential sources: parametric, expert judgment, and analogous estimates.
    • Parametric estimate starts with unit costs from third parties or in-house data, used to estimate the total project cost based on the materials and work.
    • Expert judgment involves the opinion of a building expert.
    • Analogous estimate compares the current project to similar past projects for cost estimation.

    Other Types of Construction Estimates

    1. Historical

    • Based on past project costs of similar projects size and scope, often adjusted for inflation.

    2. Parametric

    • Uses simple calculations and standardized rates from a third party or contractor’s historical data to estimate costs.

    3. Plinth Area

    • A parametric-based approach using the area covered by the external dimensions of a building and a standard rate to estimate costs.

    4. Bottom-Up

    • Each activity is individually priced, then rolled up to establish the overall project cost. Most accurate approach.

    5. Three Point Estimate

    • Based on the average of optimistic, most likely, and pessimistic cost scenarios. The three values are added and divided by 3 to find an average.

    6. Equipment Factored Estimate

    • Used for equipment installations. The cost of equipment is multiplied by an installation factor (including subcontractors, direct labor, and materials) to arrive at the total cost.

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    Related Documents

    Construction Estimates PDF

    Description

    Construction cost estimation involves predicting the expenses of a building project. Several types exist, including preliminary, detailed, and quantity cost estimates. Each estimate type serves a specific purpose in project planning and feasibility assessment.

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