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Appendix C: Cost Estimating Methodologies

NASA cost Estimating Handbook Version Appendix C cost Estimating Methodologies C-1 February 2015 Appendix C: cost Estimating Methodologies 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. The three basic cost Estimating methods that can be used during a NASA project s life cycle are analogy, parametric, and engineering build-up (also called grassroots ) as well as extrapolation from actuals using Earned Value Management (EVM).

Assuming a linear relationship between power and cost, and assuming also that power is a cost driver of solar array cost, the single-point analogy calculation can be performed as follows: Solar Array Cost for System B = 3.4/2.3 * $10M = $14.8M Complexity or adjustment factors can also be applied to an analogy estimate to make allowances for year

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