Definition
A cost structure describes how the costs of a project or activity are divided according to their type, source or function.
Human Explanation
It shows what the total cost of an undertaking consists of.
Why it Matters
Understanding the cost structure supports budgeting, viability assessment and identification of areas for optimisation.
Conceptual Boundary
A cost structure does not determine the amount of funding or how it will be obtained.
Practical Perspective
The analysis may include capital, operating, personnel and administrative costs as well as external services and materials.