A key factor for a contractor to consider in pricing its goods and services at an amount that is both palatable to the purchaser and profitable for the contractor is an astute evaluation of the underlying costs and any expected increases. Accuracy in evaluating and forecasting these figures is important because even a minor deviation could effectively render a profitable contract unviable. Of course, the problem facing contractors is that a construction contract may cover a project spanning several years, during which time unforeseen circumstances, both micro and macroeconomic, may result in increases to costs that were completely unexpected at