What are the different types of estimates In Mechanical Engineering?
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Answer:
There are five types of estimates based on accuracy:
Order of Magnitude
Also called Rough Order of Magnitude (ROM) or Rough Cost Estimate, or Conceptual Estimate, this type of estimate is used for project screening, or deciding which among several projects to proceed with. The project should be defined around 0 – 5%, and the accuracy is in the range of 30 – 50%. It does not break the project down into parts. Rather, it involves determining the overall units and scaling them to a known value. For example, the estimate of a house is scaled by square footage from a previous house building project.This type of estimate is used to determine the feasibility of a project and proceed with a decision to carry out the project (a go/no-go decision). Large infrastructure projects develop this type of estimate in order to present the board with the information to make the decision to carry out or abandon the project. The project is defined around 5 – 20%, and the accuracy is in the range of 10 – 25%. The exact project definition level is determined by the minimum amount necessary to make the decisionPreliminary
Also called budget level estimate, this type of estimate is used to aid in a decision to choose among the various options available. The options for the final product, its features, and configuration are analyzed and estimated to make a decision to proceed with one alternative over the others. Hence, the estimate needs only to be as detailed as necessary to distinguish between alternatives. The project definition level is about 10 – 40%, and the accuracy of the estimate is 10 – 15%.Substantive