estimate

Estimation, or an estimate, is the process of deriving an approximate value for a quantity when exact measurement is impractical or impossible. An estimate relies on available data, models, experience, or educated judgment and inherently includes some uncertainty. In everyday language, to estimate is to form a best-guess value, and a noun estimate refers to the resulting value. The word originates from the Latin aestimare, meaning to value or appraise.

In statistics and data analysis, an estimate is a statistic used to infer a population parameter. Point estimates provide a single best guess (for example, the sample mean as an estimate of the population mean), while interval estimates (such as confidence intervals) express uncertainty around that guess. Common methods include maximum likelihood estimation, least squares, Bayesian estimation, and nonparametric approaches.

In practical contexts, estimates are used for planning and budgeting. Cost estimates, time estimates, and resource estimates range from rough orders of magnitude to detailed budgets, often with contingencies and expressed uncertainty. Techniques include expert judgment, analogy with past projects, parametric modeling, three-point estimation, and structured methods like the Delphi technique.

Uncertainty, data quality, and model assumptions limit accuracy. Biases, missing data, and changing conditions can distort estimates. Good practice involves documenting assumptions, methods, data sources, and the quantified uncertainty; updating estimates as new information becomes available; and communicating the level of confidence alongside the estimate.