People often associate bandwidth with data transfer but all together they are different from each other. But however, they have close connections. Bandwidth is how much data can be transferred at a time and data transfer is how much data is being transferred. Or in other words, Bandwidth is the technology and data transfer is the gateway for bandwidth.
How It Affects Your Site:
Bandwidth and site uploading has a direct relationship.That is, The less bandwidth you have, the slower your site takes to load. If you have more visitors, some of them will have to wait their turn. The least data transfer you have, the more often you'll find your site unavailable because you've reached the maximum allowed until a new month rolls by or you upgrade your account.

Determining Your Requirements:
Usually, when a host talks about bandwidth, they are referring to your transfer. Hence it's purely your assumption of choosing the required amount of bandwidth for your website. Most of this information is available from your traffic history. If you don't have an existing site, provide an optimistic estimate if you intend to heavily promote the site. You can also do some of the daily calculations on your website by;

Find out the daily averages of

  • Number of visitors / expected number of visitors
  • Page size including the graphics of the page
  • Page views / expected pages viewed by each visitor

Then, multiply them as follows:
Visitors x Page size x Page views x 30 days = Monthly Website Transfer
You should also throw in a small margin or error there to take into account email traffic and your own uploads to the server. If you offer downloads, then you should add the following:
Average/Expected downloads x File Size x 30 days = Monthly Download Transfer.