Estimate Costs Process

Cost estimating is one of the most integral components of project management. In order to create a reliable project budget, we must have an understanding of the individual costs of project activities. Even though we may not always have a definite number for these expenses, there are tools that we can use to arrive at close estimations.

In PMBOK 7 estimating is a part of ;
Cost management plans and scope baseline are essential components of the cost estimation process. They provide critical information on the scope of the project and its associated constraints and assumptions. 

Furthermore, work breakdown structures are instrumental in giving an accurate account of the work that must be done. When making these estimates, the PMI encourages using various tools and techniques such as 3-point estimation, analogous estimation, parametric estimation, and bottom-up estimation. As a safeguard, reserve analysis should be conducted to calculate reserve funds, and alternative analysis techniques should be applied to the decision-making process.