10The Role of Risk, Value, and Cost in Making Decisions
10.1 INTRODUCTION
At its core, the purpose of cost estimation is to support the decision-making process. For both organizations and individuals, decisions are the only mechanism available to influence future outcomes. A decision is an important event as it involves a commitment of resources. Decisions are either made or they are not. Speculation, hypothesizing, and procrastination decision aren’t decisions. According to Howard and Abbas (2016) a decision is defined as “A choice between two or more alternatives that involves an irrevocable allocation of resources.” The important characteristic of decisions is that they can at times be simple and straightforward ...
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