Question

Using the Three-Point Estimating and Beta Distribution, what is the Expected Activity Cost if: (1) Most Likely Duration is 111 hours, (2) Optimistic Duration is 80 hours, and (3) Pessimistic Duration is 130 Hours? Assume a labor rate of $83/Hr. O $15,582 O $8,881 $6,664 O $4,984

Answer 1

	1. Three point distribution:
	Three point Distribution: E = (o + m + p ) / 3
	where E is Estimate; o = optimistic estimate; p = pessimistic estimate; m = most likely estimate
	E = (80+111+130)/3
	E = 321/3
	E = 107 hours
	hence labour cost = 107*83 = 8,881
	Option B is correct answer.
	2. Beta distribution method
	E = (o + 4m + p ) / 6
	E = (80 + 444 + 130)/6
	E = 109 Hours
	hence, labour cost = 109*83 = $9047