ASTM E833-08
(Terminology)Standard Terminology of Building Economics
Standard Terminology of Building Economics
SCOPE
1.1 This terminology relates to the economic evaluation of building construction as used in other standards under the jurisdiction of ASTM Committee E06 on Performance of Buildings, and it does not necessarily correspond to the terminology used in other areas of accounting and economics. DEFINITIONS Top
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Designation:E833–08
Standard Terminology of
1
Building Economics
This standard is issued under the fixed designation E 833; the number immediately following the designation indicates the year of
original adoption or, in the case of revision, the year of last revision. A number in parentheses indicates the year of last reapproval. A
superscript epsilon (´) indicates an editorial change since the last revision or reapproval.
1. Scope benefit-cost analysis, n—a method of evaluating projects or
investments by comparing the present value or annual value
1.1 This terminology relates to the economic evaluation of
of expected benefits to the present value or annual value of
building construction as used in other standards under the
expected costs.
jurisdiction of ASTM Committee E06 on Performance of
benefit-to-cost ratio (BCR), n—benefits divided by costs,
Buildings, and it does not necessarily correspond to the
where both are discounted to a present value or equivalent
terminology used in other areas of accounting and economics.
uniform annual value (syn. benefit-cost ratio).
DEFINITIONS break even analysis, n—a technique for determining that
value of a variable which results in benefits (savings) just
adjusted internal rate-of-return (AIRR), n—the compound
equal to costs.
rate of interest that, when used to discount the terminal
building decision, n—a decision regarding the design, financ-
values of costs and benefits of a project over a given study
ing, engineering, construction, management, or operation of
period, will make the costs equal the benefits when cash
a building.
flows are reinvested at a specified rate (syn. financial
building economics, n—the application of economic analysis
management rate of return (FMRR)).
to the design, financing, engineering, construction, manage-
allowance, n—in construction design planning and estimating,
ment, operation, ownership, or disposition of buildings.
an allocation of money that is intended to be spent for a
building system, n—an aggregation or assemblage of items
specific purpose.
joined in regular interaction or interdependence in buildings
DISCUSSION—An allowance is used in the absence of precise knowl-
or building construction.
edge, and estimated, to be of one’s knowledge, to ensure a full and
capital cost, n—the costs of acquiring, substantially improv-
complete estimate. Allowances cover events and activities that are
ing, expanding, changing the functional use of, or replacing
normally directly controllable within a project plan.
a building or building system.
annual value, n—a uniform annual amount equivalent to the cash flow, n—the stream of monetary (dollar) values—costs
project costs or benefits taking into account the time value of and benefits—resulting from a project investment.
money throughout the study period (syn. annual worth, certainty equivalent technique, n—a technique used to adjust
equivalent uniform annual value). economic measures of project worth to reflect risk exposure
annual worth, n—See annual value. and risk attitude.
annually recurring costs, n—those costs that are incurred in
DISCUSSION—Estimated project returns are multiplied by a certainty
a regular pattern each year throughout the study period.
equivalent factor (CEF) to determine the certainty equivalent amount a
base date, n—See base time.
decision maker finds equally acceptable to the estimated project
basetime, n—the date to which all future and past benefits and
returns.
costs are converted when a present value method is used
code of accounts, n—a hierarchical, company-specific system
(usually the beginning of the study period) (syn. base date).
for cost accounting, control, and management.
baseline plan, n—an established scope, cost, schedule, and
Comprehensive Environmental Response, Compensation,
technical performance plan against which the status of
and Liability Act (CERCLA), n—also known as “Super-
resources and the effort of the overall program or project
fund,” CERCLA prescribes actions and regulatory require-
activities are measured, assessed, and controlled.
ments for reducing risks to human health and the environ-
ment resulting from releases or threatened releases of
hazardous substances into the environment.
1
This terminology is under the jurisdiction of ASTM Committee E06 on
constant dollars, n—dollars of uniform purchasing power
Performance of Buildings and is the direct responsibility of Subcommittee E06.81
on Building Economics.
exclusive of general inflation or deflation.
Current edition approved Nov. 1, 2008. Published November 2008. Originally
approved in 1981. Last previous edition approved in 2004 as E 833 – 06. DISCUSSION—Constant dollars are tied to a reference year.
Copyright © ASTM International, 100 Barr Harbor Drive, PO Box C700, West Conshohocken, PA 19428-2959, United States.
1
---------------------- Pa
...
This document is not an ASTM standard and is intended only to provide the user of an ASTM standard an indication of what changes have been made to the previous version. Because
it may not be technically possible to adequately depict all changes accurately, ASTM recommends that users consult prior editions as appropriate. In all cases only the current version
of the standard as published by ASTM is to be considered the official document.
Designation:E 833–06 Designation: E 833 – 08
Standard Terminology of
1
Building Economics
This standard is issued under the fixed designation E 833; the number immediately following the designation indicates the year of
original adoption or, in the case of revision, the year of last revision. A number in parentheses indicates the year of last reapproval. A
superscript epsilon (´) indicates an editorial change since the last revision or reapproval.
1. Scope
1.1 Thisterminologyrelatestotheeconomicevaluationofbuildingconstructionasusedinotherstandardsunderthejurisdiction
of ASTM Committee E06 on Performance of Building Constructions, Buildings, and it does not necessarily correspond to the
terminology used in other areas of accounting and economics.
DEFINITIONS
adjusted internal rate-of-return (AIRR), n—the compound rate of interest that, when used to discount the terminal values of
costs and benefits of a project over a given study period, will make the costs equal the benefits when cash flows are reinvested
at a specified rate. (Syn.rate (syn. financial management rate of return (FMRR))).
allowance, n—in construction design planning and estimating, an allocation of money that is intended to be spent for a specific
purpose.
DISCUSSION—An allowance is used in the absence of precise knowledge, and estimated, to be of one’s knowledge, to ensure a full and complete
estimate. Allowances cover events and activities that are normally directly controllable within a project plan.
annual value, n—a uniform annual amount equivalent to the project costs or benefits taking into account the time value of money
throughout the study period (Syn.(syn. annual worth, equivalent uniform annual value).
annual worth, n—See annual worth, n—See annual value.
annually recurring costs, n—those costs that are incurred in a regular pattern each year throughout the study period.
base date, n— See base date, n—See base time.
base time, n—the date to which all future and past benefits and costs are converted when a present value method is used (usually
the beginning of the study period) (Syn.(syn. base date).
baseline plan, n—an established scope, cost, schedule, and technical performance plan against which the status of resources and
the effort of the overall program or project activities are measured, assessed, and controlled.
benefit-cost analysis, n—a method of evaluating projects or investments by comparing the present value or annual value of
expected benefits to the present value or annual value of expected costs.
benefit-to-cost ratio (BCR), n—benefits divided by costs, where both are discounted to a present value or equivalent uniform
annual value (Syn.(syn. benefit-cost ratio).
break even analysis, n—a technique for determining that value of a variable which results in benefits (savings) just equal to costs.
building decision, n—a decision regarding the design, financing, engineering, construction, management, or operation of a
building.
building economics, n—the application of economic analysis to the design, financing, engineering, construction, management,
operation, ownership, or disposition of buildings.
building system, n—an aggregation or assemblage of items joined in regular interaction or interdependence in buildings or
building construction.
capital cost, n—the costs of acquiring, substantially improving, expanding, changing the functional use of, or replacing a building
or building system.
cash flow, n—the stream of monetary (dollar) values—costs and benefits—resulting from a project investment.
certainty equivalent technique, n—a technique used to adjust economic measures of project worth to reflect risk exposure and
risk attitude.
DISCUSSION—Estimated project returns are multiplied by a certainty equivalent factor (CEF) to determine the certainty equivalent amount a decision
maker finds equally acceptable to the estimated project returns.
1
This terminology is under the jurisdiction of ASTM Committee E06 on Performance of Buildings and is the direct responsibility of Subcommittee E06.81 on Building
Economics.
Current edition approved Sept. 15, 2006.Nov. 1, 2008. Published October 2006.November 2008. Originally approved in 1981. Last previous edition approved in 2004 as
E 833 – 046.
Copyright © ASTM International, 100 Barr Harbor Drive, PO Box C700, West Conshohocken, PA 19428-2959, United States.
1
---------------------- Page: 1 ----------------------
E833–08
code of accounts, n—a hierarchical, company-specific system for cost accounting, control, and management.
Comprehensive Environmental Response,
...
This document is not an ASTM standard and is intended only to provide the user of an ASTM standard an indication of what changes have been made to the previous version. Because
it may not be technically possible to adequately depict all changes accurately, ASTM recommends that users consult prior editions as appropriate. In all cases only the current version
of the standard as published by ASTM is to be considered the official document.
Designation:E 833–06 Designation: E 833 – 08
Standard Terminology of
1
Building Economics
This standard is issued under the fixed designation E 833; the number immediately following the designation indicates the year of
original adoption or, in the case of revision, the year of last revision. A number in parentheses indicates the year of last reapproval. A
superscript epsilon (´) indicates an editorial change since the last revision or reapproval.
1. Scope
1.1 Thisterminologyrelatestotheeconomicevaluationofbuildingconstructionasusedinotherstandardsunderthejurisdiction
of ASTM Committee E06 on Performance of Building Constructions, Buildings, and it does not necessarily correspond to the
terminology used in other areas of accounting and economics.
DEFINITIONS
adjusted internal rate-of-return (AIRR), n—the compound rate of interest that, when used to discount the terminal values of
costs and benefits of a project over a given study period, will make the costs equal the benefits when cash flows are reinvested
at a specified rate. (Syn.rate (syn. financial management rate of return (FMRR))).
allowance, n—in construction design planning and estimating, an allocation of money that is intended to be spent for a specific
purpose.
DISCUSSION—An allowance is used in the absence of precise knowledge, and estimated, to be of one’s knowledge, to ensure a full and complete
estimate. Allowances cover events and activities that are normally directly controllable within a project plan.
annual value, n—a uniform annual amount equivalent to the project costs or benefits taking into account the time value of money
throughout the study period (Syn.(syn. annual worth, equivalent uniform annual value).
annual worth, n—See annual worth, n—See annual value.
annually recurring costs, n—those costs that are incurred in a regular pattern each year throughout the study period.
base date, n— See base date, n—See base time.
base time, n—the date to which all future and past benefits and costs are converted when a present value method is used (usually
the beginning of the study period) (Syn.(syn. base date).
baseline plan, n—an established scope, cost, schedule, and technical performance plan against which the status of resources and
the effort of the overall program or project activities are measured, assessed, and controlled.
benefit-cost analysis, n—a method of evaluating projects or investments by comparing the present value or annual value of
expected benefits to the present value or annual value of expected costs.
benefit-to-cost ratio (BCR), n—benefits divided by costs, where both are discounted to a present value or equivalent uniform
annual value (Syn.(syn. benefit-cost ratio).
break even analysis, n—a technique for determining that value of a variable which results in benefits (savings) just equal to costs.
building decision, n—a decision regarding the design, financing, engineering, construction, management, or operation of a
building.
building economics, n—the application of economic analysis to the design, financing, engineering, construction, management,
operation, ownership, or disposition of buildings.
building system, n—an aggregation or assemblage of items joined in regular interaction or interdependence in buildings or
building construction.
capital cost, n—the costs of acquiring, substantially improving, expanding, changing the functional use of, or replacing a building
or building system.
cash flow, n—the stream of monetary (dollar) values—costs and benefits—resulting from a project investment.
certainty equivalent technique, n—a technique used to adjust economic measures of project worth to reflect risk exposure and
risk attitude.
DISCUSSION—Estimated project returns are multiplied by a certainty equivalent factor (CEF) to determine the certainty equivalent amount a decision
maker finds equally acceptable to the estimated project returns.
1
This terminology is under the jurisdiction of ASTM Committee E06 on Performance of Buildings and is the direct responsibility of Subcommittee E06.81 on Building
Economics.
Current edition approved Sept. 15, 2006.Nov. 1, 2008. Published October 2006.November 2008. Originally approved in 1981. Last previous edition approved in 2004 as
E 833 – 046.
Copyright © ASTM International, 100 Barr Harbor Drive, PO Box C700, West Conshohocken, PA 19428-2959, United States.
1
---------------------- Page: 1 ----------------------
E833–08
code of accounts, n—a hierarchical, company-specific system for cost accounting, control, and management.
Comprehensive Environmental Response,
...
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