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Unit 10: The Cost Approach—Part I: Reproduction/Replacement Cost

1. What is the cost approach formula, and why is the principle of substitution important in this valuation method?
2. What is the difference between reproduction cost and replacement cost?
3. What is Marshall & Swift, and how does it assist appraisers in estimating replacement cost? Visit their website or watch a video (CoreLogic Video on Marshall and SwiftLinks to an external site. and Marshall and Swift Estimator Links to an external site.) and determine which cost estimation method it is primarily associated with.
4. What types of costs are included in the unit-in-place method, and how does it differ from the square-foot method?
5. What is the quantity survey method, and why is it the most detailed approach to cost estimation?
6. Below are the four methods of finding reproduction/replacement cost. Choose one and explain how it works:
   • Index Method
   • Square-Foot Method
   • Unit-in-Place Method
   • Quantity Survey Method