In project estimation, what is the term for the estimate based on net present value analysis?

The term for the estimate based on net present value (NPV) analysis is known as a life cycle estimate. This type of estimate considers all costs associated with the project over its entire life cycle, including initial costs, operating costs, maintenance, and disposal costs. NPV analysis plays a crucial role as it helps to determine the financial viability of a project by evaluating the present value of expected cash flows over time.

By using life cycle estimates, project managers can assess the total cost of ownership of a project, which supports informed decision-making regarding budget allocations and project feasibility. This holistic approach ensures that all financial aspects are considered, making it a robust tool for project estimation in various sectors.