underestimate n : an estimation that is too low; an estimate that is less than the true or actual value [syn: underestimation, underrating, underreckoning] v
1. assign too low a value to; "Don't underestimate the value of this heirlooom-you may sell it at a good price" [syn: undervalue] [ant: overvalue, overvalue]
2. make a deliberately low estimate; "The construction company wanted the contract badly and lowballed" [syn: lowball]
3. make too low an estimate of; "he underestimated the work that went into the renovation"; "Don't underestimate the danger of such a raft trip on this river" [syn: underrate] [ant: overestimate]

Underestimate \Un`der*es"ti*mate\, v. t. To set to? low a value on; to estimate below the truth.

Underestimate \Un`der*es"ti*mate\, n. The act of underestimating; too low an estimate.

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A Cost overrun, also known as a cost increase or budget overrun, is an unexpected cost incurred in excess of a budgeted amount due to an under-estimation of the actual cost during budgeting. Cost overrun should be distinguished from cost escalation, which is used to express an anticipated growth in a budgeted cost due to factors such as inflation.

Cost overrun is common in infrastructure, building, and technology projects. A comprehensive study of cost overrun published in the Journal of the American Planning Association in 2002 found that 9 out of ten construction projects had underestimated costs. Overruns of 50 to one hundred percent were common.

Many major construction projects have incurred cost overruns. The Suez Canal cost 20 times as much as the earliest estimates; even the cost estimate produced the year before construction began underestimated the project's actual costs by a factor of three.

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