The way I really understand it, is that its estimating by the highest place value, not a very close estimation, but still around the number.
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A reasonable estimate will give an indication of the order of magnitude of the number. The order of magnitude is determined by the decimal point and so knowing the order can help in placing it.
The magnitude estimate for 12.2 multiplied by 1.56 is approximately 19.03.
1000
The order of magnitude for 15 is 1. -Apex.