The choice of a development life cycle methodology significantly impacts both project cost and time-to-market. For instance, the Waterfall model, with its sequential phase completion, can lead to longer time-to-market due to its lack of flexibility and late testing phase. Changes or issues discovered late in the process can result in costly revisions and delays. On the other hand, methodologies like RAD and Iterative, with their focus on rapid development and frequent iterations, can accelerate time-to-market. However, these methodologies may incur higher costs due to the need for more resources, ongoing user involvement, and the potential for scope creep. Iterative methods, while offering faster initial releases, might lead to incremental costs with each iteration. In contrast, the Waterfall model often has a more predictable cost structure but at the expense of adaptability and speed. Ultimately, the choice of methodology should align with the project's priorities, whether that is minimising costs, speeding up delivery, or balancing both.

Choosing between RAD (Rapid Application Development) and other models like Waterfall and Iterative depends on several critical factors. Firstly, project size and complexity play a significant role. RAD is well-suited for small to medium-sized projects with less complexity, whereas Waterfall and Iterative are more appropriate for larger, more complex projects. Secondly, the project timeline is crucial; RAD is ideal for projects with tight deadlines due to its focus on rapid development and iteration. Thirdly, the level of user involvement is a determining factor. RAD requires active user participation for feedback and testing, making it suitable for projects where user requirements are a central focus and can be frequently updated. Additionally, the project’s requirement stability is a key consideration. The Waterfall model is preferable for projects with well-defined and stable requirements, while RAD and Iterative models are better for projects where requirements are expected to evolve. Finally, the availability of skilled resources is critical; RAD requires a team adept in RAD-specific methodologies, which might not be necessary for Waterfall or Iterative projects.

Combining the Iterative model with other methodologies can bring several benefits but also poses certain challenges. A common combination is using Iterative principles within the Agile framework, which incorporates iterative development with flexible planning, evolutionary development, and continual improvement. This hybrid approach allows for the adaptability and client engagement of Agile with the structured and systematic process of the Iterative model.

The benefits of such a combination include enhanced flexibility to adapt to changing requirements, improved client satisfaction through regular feedback and involvement, and the ability to more effectively manage complex projects by breaking them down into manageable iterations.

However, challenges include potential conflicts between the methodologies' core principles, such as the balance between structure and flexibility. Additionally, managing such a hybrid approach requires skilled personnel familiar with both methodologies and adept at navigating their integration. This complexity can lead to increased management overhead and the need for effective communication and collaboration among team members. Despite these challenges, combining methodologies can lead to a more tailored and effective approach to software development, provided it is executed with careful consideration of the project's specific needs and constraints.

The Iterative model manages risks in software development by breaking down the project into smaller, more manageable segments, allowing for regular assessment and adaptation. This approach offers several advantages in risk management. Firstly, it enables early detection and resolution of issues, as each iteration involves a full software development cycle, including testing. Early testing and feedback mean that problems can be identified when they are less complex and cheaper to fix. Secondly, the iterative nature allows for constant evaluation and re-evaluation of project requirements and goals, ensuring that the project stays aligned with user needs and market trends. This adaptability reduces the risk of developing software that does not meet user expectations or is obsolete by the time of its release. Lastly, by producing a working version of the software early in the development process, the Iterative model provides a proof of concept, which can be used to garner stakeholder support and potentially secure additional resources. This early validation helps in mitigating financial and market-related risks.

The rigidity of the Waterfall model, characterized by its linear and sequential phases, has a significant impact on its application in contemporary software development. In today's dynamic tech environment, where requirements often evolve during the development process, the Waterfall model's inflexibility becomes a major limitation. Once a stage is completed, revisiting or altering it can be difficult and costly, making the model unsuitable for projects where adaptability is key. Furthermore, the late testing phase means that any defects or requirement changes discovered late in the process require a return to earlier stages, leading to delays and increased costs. Despite these drawbacks, the Waterfall model still finds relevance in projects with very stable requirements or where a clearly defined, unchanging process is necessary. However, its use has diminished in favour of more flexible methodologies like Agile, which better accommodate the fast-paced and changeable nature of modern software development.