1、Designation: E 833 06Standard Terminology ofBuilding Economics1This standard is issued under the fixed designation E 833; the number immediately following the designation indicates the year oforiginal adoption or, in the case of revision, the year of last revision. A number in parentheses indicates
2、the year of last reapproval. Asuperscript epsilon (e) indicates an editorial change since the last revision or reapproval.1. Scope1.1 This terminology relates to the economic evaluation ofbuilding construction as used in other standards under thejurisdiction of ASTM Committee E06 on Performance ofBu
3、ilding Constructions, and does not necessarily correspond tothe terminology used in other areas of accounting and econom-ics.DEFINITIONSadjusted internal rate-of-return (AIRR), nthe compoundrate of interest that, when used to discount the terminalvalues of costs and benefits of a project over a give
4、n studyperiod, will make the costs equal the benefits when cashflows are reinvested at a specified rate. (Syn. financialmanagement rate of return (FMRR)allowance, nin construction design planning and estimating,an allocation of money that is intended to be spent for aspecific purpose.DISCUSSIONAn al
5、lowance is used in the absence of precise knowl-edge, and estimated, to be of ones knowledge, to ensure a full andcomplete estimate. Allowances cover events and activities that arenormally directly controllable within a project plan.annual value, na uniform annual amount equivalent to theproject cos
6、ts or benefits taking into account the time value ofmoney throughout the study period (Syn. annual worth,equivalent uniform annual value).annual worth, nSee annual value.annually recurring costs, nthose costs that are incurred ina regular pattern each year throughout the study period.base date, nSee
7、 base time.base time, nthe date to which all future and past benefits andcosts are converted when a present value method is used(usually the beginning of the study period) (Syn. base date).baseline plan, nan established scope, cost, schedule, andtechnical performance plan against which the status of
8、resources and the effort of the overall program or projectactivities are measured, assessed, and controlled.benefit-cost analysis, na method of evaluating projects orinvestments by comparing the present value or annual valueof expected benefits to the present value or annual value ofexpected costs.b
9、enefit-to-cost ratio (BCR), nbenefits divided by costs,where both are discounted to a present value or equivalentuniform annual value (Syn. benefit-cost ratio).break even analysis, na technique for determining thatvalue of a variable which results in benefits (savings) justequal to costs.building de
10、cision, na decision regarding the design, financ-ing, engineering, construction, management, or operation ofa building.building economics, nthe application of economic analysisto the design, financing, engineering, construction, manage-ment, operation, ownership, or disposition of buildings.building
11、 system, nan aggregation or assemblage of itemsjoined in regular interaction or interdependence in buildingsor building construction.capital cost, nthe costs of acquiring, substantially improv-ing, expanding, changing the functional use of, or replacinga building or building system.cash flow, nthe s
12、tream of monetary (dollar) valuescostsand benefitsresulting from a project investment.certainty equivalent technique, na technique used to adjusteconomic measures of project worth to reflect risk exposureand risk attitude.DISCUSSIONEstimated project returns are multiplied by a certaintyequivalent fa
13、ctor (CEF) to determine the certainty equivalent amount adecision maker finds equally acceptable to the estimated projectreturns.code of accounts, na hierarchical, company-specific systemfor cost accounting, control, and management.Comprehensive Environmental Response, Compensation,and Liability Act
14、 (CERCLA), nalso known as “Super-fund,” CERCLA prescribes actions and regulatory require-ments for reducing risks to human health and the environ-ment resulting from releases or threatened releases ofhazardous substances into the environment.1This terminology is under the jurisdiction of ASTM Commit
15、tee E06 onPerformance of Buildings and is the direct responsibility of Subcommittee E06.81on Building Economics.Current edition approved Sept. 15, 2006. Published October 2006. Originallyapproved in 1981. Last previous edition approved in 2004 as E 833 04.1Copyright ASTM International, 100 Barr Harb
16、or Drive, PO Box C700, West Conshohocken, PA 19428-2959, United States.constant dollars, ndollars of uniform purchasing powerexclusive of general inflation or deflation.DISCUSSIONConstant dollars are tied to a reference year.construction contingency, nthe funds added to estimatedand known costs in c
17、ase of cost overruns during construc-tion.construction documents, nmaterials that convey the physi-cal, aesthetic, technical, performance, and administrativerequirements necessary to initiate a contract for constructionof the proposed project.contingency, nin construction design planning and estimat
18、-ing, a sum of money that is provided to cover the occurrenceof unintended departures from the planned scope of work.DISCUSSIONA contingency is used in the absence of preciseknowledge, and estimated, to be of ones knowledge, to ensure that afinancial buffer is available within a budget. Contingencie
19、s assist inmitigating the effects of unplanned events and other risks that arenormally not directly controllable within a project plan.cost analysis, nsubdividing the project estimate into com-ponent parts to find and compare their relationship topreviously established historical costs.cost effectiv
20、e, adjthe condition whereby the present valuebenefits (savings) of an investment exceeds its present valuecosts.cost limitations, nthe budget boundaries for project ele-ments.cost model, nthe description of the project divided intodiscrete elements showing quantities and unit price for eachelement.c
21、ost overruns, nin project design or construction, or both,the unanticipated increase in cost due to factors such asunanticipated site conditions, changes in the cost of buildingmaterials, labor, weather, and labor disputes.cost professional, nin project design or construction, orboth, a person engag
22、ed in the occupation of understanding,managing or estimating project costs, or a combinationthereof.current dollars, ndollars of purchasing power in whichactual prices are stated, including inflation or deflation.DISCUSSIONIn the absence of inflation or deflation, current dollarsequal constant dolla
23、rs.deactivation, nthe process of placing a facility in a safe andstable condition to minimize the long-term cost of a surveil-lance and maintenance program and to protect the workers,the public, and the environment.decision analysis, na technique for making economic deci-sions in an uncertain enviro
24、nment that allows a decisionmaker to include alternative outcomes, risk attitudes, orsubjective impressions about uncertain events in an evalua-tion of investments.decommissioning, ntakes place after deactivation, and in-cludes surveillance and maintenance, decontamination, dis-mantlement, surveilla
25、nce and long-term monitoring, or anycombination thereof.decontamination, nthe removal of hazardous or radioactivematerial, or both, from facilities, soils, or equipment topreclude the occurrence of foreseeable adverse health ef-fects.design contingency, nin project design/construction, theamount of
26、funds added to the estimated construction costs tocover unanticipated construction costs due to the incom-pleteness of the design, where the contingency is inverselyproportional to the level of completeness of the designdocumentation.design development, nthe phase of a project consisting ofdrawings
27、and document preparation to fix and describe thesize and character of the building systems, material, andelements.design program, nthe information detailing project func-tion, purpose, and characteristics inclusive of floor area,functional spaces, equipment, and building systems.desires, nthe functi
28、ons that the value analysis team deter-mines to be fulfilled if cost is not a factor, or functions whichdo not otherwise violate a constraint.differential price escalation rate, nthe expected percentdifference between the rate of increase assumed for a givenitem of cost (such as energy), and the gen
29、eral rate ofinflation.discounting, na technique for converting cash flows thatoccur over time to equivalent amounts at a common time.discount rate, nthe rate of interest reflecting the investorstime value of money, used to determine discount factors forconverting benefits and costs occurring at diff
30、erent times toa base time.DISCUSSIONThe discount rate may be expressed as nominal or real.discount factor, na multiplicative number (calculated froma discount formula for a given discount rate and interestperiod) that is used to convert costs and benefits occurring atdifferent times to a common time
31、.discounted payback (DPB) period, nthe time required forthe cumulative benefits from an investment to pay back theinvestment cost and other accrued costs considering the timevalue of money.economic evaluation methods, na set of economic analysistechniques that consider all relevant costs associated
32、with aproject investment during its study period, comprising suchtechniques as life-cycle cost, benefit-to-cost ratio, savings-to-investment ratio, internal rate of return, and net savings.economic life, nthat period of time over which an invest-ment is considered to be the least-cost alternative fo
33、rmeeting a particular objective.element, nin construction planning, design, specification,estimating, and cost analysis, is a significant component partof the whole that performs a specific function, or functions,regardless of design, specification, or construction.DISCUSSIONWhile through analysis,
34、or by direct application, con-struction estimates categorized into elements (functional elements)with allocated costs, may be summarized in an elemental costsummary or elemental cost analysis; elements (functional elements)also provide a framework for consistent preliminary description,E833062outlin
35、e, and performance specification, though all stages of planning,design, construction, and maintenance.elemental cost analysis, nin construction planning, design,specification, estimating, and cost analysis, is a tabulation ofcost categorized by group element, element,orsub-element, or any combinatio
36、n thereof, to which a parameterquantity, or parameter quantities, has, or have, been appliedto derive benchmark figures (rates, ratios, percentages, andso forth).DISCUSSIONElemental cost analyses are valuable tools in planning,estimating, and controlling construction cost through all stages ofplanni
37、ng and design. The benchmark figures are primarily derived fromunderlying estimate detail but can, in some circumstances, be useddirectly to approximate estimates for other projects.elemental cost summary, nin construction planning, de-sign, specification, estimating, and cost analysis, is a tabu-la
38、tion of cost categorized by group element, element,orsub-element.engineering economics, nthe application of economic tech-niques to the evaluation of design and engineering alterna-tives.equivalent uniform annual value, nSee annual value.ex situ treatment, ntreatment, remediation, or cleanup ofconta
39、minated material in a treatment facility at a differentlocation from the contaminated site.field requirements, nin construction design planning andestimating, the nonpermanent portion of construction costthat is essential to permit implementation of the constructionwork in the field.DISCUSSIONUsuall
40、y relating to permits, insurances, supervision,site set-up, and other requirements that permit the construction process,but excluding such temporary construction work as formwork, bracing,shoring, and other work required to install the permanent constructionwork.financial management rate-of-return (
41、FMRR), nSee ad-justed internal rate-of-return (AIRR).first cost, ncosts incurred in placing a building or buildingsubsystem into service, including, but not limited to, costs ofplanning, design, engineering, site acquisition and prepara-tion, construction, purchase, installation, property taxes andi
42、nterest during the construction period, and constructionrelated fees (Syn. initial investment cost, initial cost).function, na purpose of the entire project or some portionthereof determined by the needs or desires of the user/ownerand expressed in two words, an active verb and a measurablenoun.func
43、tion analysis, nan examination of the project consistingof (1) the determination of the project functions; (2) theexamination and sorting of these functions into categories;(3) the selection of the critical functions and arrangementinto a logical order; and (4) the determination of the projectcost a
44、llocated to performing each critical function.function, basic, na function that is necessary to achieve theprimary purpose of a building system or element.functional element, nin construction planning, design,specification, estimating, and cost analysis; see element.future value, nthe value of a ben
45、efit or a cost at some pointin the future, considering the time value of money (Syn.future worth).future worth, nSee future value.general overhead, nthe fixed cost associated with operationof the corporate or main office, plant, equipment, and staffingmaintained by a contractor for general business
46、operations.DISCUSSIONGeneral overhead costs may not be specifically appli-cable to a particular job or project.group element, nin construction planning, design, specifi-cation, estimating, and cost analysis, is a component part ofthe whole that includes relevant elements which, as a group,perform ma
47、jor specific function, or functions, regardless ofdesign, specification, or construction.hazardous waste, nwaste that is listed as hazardous by theEnvironmental Protection Agency (EPA) and/or exhibits oneor more of the following characteristics: ignitability, reac-tivity, corrosivity, or toxicity, a
48、s specified in the Code ofFederal Regulations (CFR) part 261.DISCUSSIONEPA did not intend to regulate many common materialssuch as paper, wood, vinegar, detergents, and other waste as hazardous.As a result, EPA has developed a list of products that are consideredhazardous waste and has developed cri
49、teria and test methods todetermine if the waste has hazardous characteristics. These listings andtesting criteria can be found in the CFR 261.in situ treatment, ntreatment, remediation, or cleanup ofcontaminated sites and materials in placeincremental cost (benefit), nthe additional cost (benefit)resulting from an increase in the investment in a buildingproject (Syn. marginal cost (benefit).inflation, na rise in the general price level, usually expressedas a percentage rate.initial cost, nSee first cost
