Uncertainties in Cost Estimation

UNCERTAINTIES IN COST ESTIMATION

One can perform cost estimation at any point in the software life cycle. As the cost of the project depends on the nature and characteristics of the project, at any point, the accuracy of the estimate will depend on the amount of reliable information about the final product.

When the product is delivered, the cost can be accurately determined as all the data about the project and the resources spent can be accurately known by then. This is cost estimation with complete knowledge about the project. During the time of feasibility study, there is a great deal of uncertainty about the actual specification of the system.

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