Cost is important to all industry. Costs can be divided into two general classes; absolute costs and relative costs. Absolute cost measures the loss in value of assets. Relative cost involves a comparison between the chosen course of action and the course of action that was rejected. This cost of the alternative action - the action not taken - is often called the "opportunity cost".

What is an estimate? What is included in this estimate and where do these costs come from? Estimate - a list of material and other costs directly and indirectly associated with the construction of your home. Direct costs will be items such as lumber, concrete, and labor. These items are things that will be permanent fixtures in the home, or such things that will have been done to complete the construction.