Accession Number:

AD0702424

Title:

AN INTRODUCTION TO EQUIPMENT COST ESTIMATING

Descriptive Note:

Corporate Author:

RAND CORP SANTA MONICA CA

Personal Author(s):

• Batchelder, C. A.
• Boren, Jr., H. E.
• Campbell, H. G.
• Dei Rossi, J. A.
• Large, J. P.

Report Date:

1969-12-01

Pagination or Media Count:

133.0

Abstract:

There are three basic methods used for cost estimation--the industrial engineering, analogy, and statistical approaches. The statistical method is considered the most useful for government cost analysts, whether the purpose is long-range planning or contract negotiation. An estimating procedure must rely on a data base that includes cost, physical and performance descriptions, and a development and production history of previous equipment programs. Experience has proved the value of the learning-curve concept. Its basis is that each time the total quantity of items produced doubles, the cost per item is reduced to a constant percentage of its previous cost. A thorough knowledge of the learning-curve phenomenon is indispensable to persons involved in cost analysis. Author

Descriptors:

• *COSTS
• *MILITARY PROCUREMENT
• MANUFACTURING
• INDUSTRIAL PRODUCTION
• MULTIVARIATE ANALYSIS
• STATISTICAL DATA
• LEARNING CURVES
• MANPOWER
• MATHEMATICAL PREDICTION
• LEAST SQUARES METHOD
• CORRELATION TECHNIQUES
• SYSTEMS ENGINEERING
• MILITARY SUPPLIES
• REGRESSION ANALYSIS

Subject Categories:

• Administration and Management
• Economics and Cost Analysis
• Logistics, Military Facilities and Supplies

Distribution Statement:

APPROVED FOR PUBLIC RELEASE