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How do you know exactly the 'Most Likely' cost/estimate/num?

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achakrab@ualberta.ca
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Location: Alberta, Canada

How do you know exactly the 'Most Likely' cost/estimate/num?

Postby achakrab@ualberta.ca Wed Sep 14, 2016 4:56 pm

Hello Dear team,

According to the PMBOK and izenbridge videos we know that the Beta distribution involves the calculation of (Optimistic + 4* Most Likely+ Pes)6 . Please see this question in the PMP math section test

You are project manager in planning phase for a Port construction project. It has been decided to outsource work for painting. In most probability you will be using services of vendor A which will cost around 650 Mn - however it may also happen that you may end up using services of vendor B which will cost you around 1200Mn but as project manager you would want to use services of vendor C which will cost you 800 Mn. Your sponsor wants you to estimate cost of Painting using Betadistribution and provide range using Budget estimate. The range you should provide



~620 –~ 975


~577-~854


~680-~970


~757-~1052

Solution

Beta Distribution : (Optimistic+4*Most likely+ Pessimistic)/6

Based on information provided

Optimistic estimate: 650 Mn

Pessimistic Estimates: 1200 Mn

My question is, from my understanding of the problem I took the Most Probably as the Most Likely option to use of the B distribution. However the answer took another one as Realistic which it says is Most Likely. I fail to understand that if 'I' am the PM and I already have a Most Likely option, then why I am choosing another one as the Realistic? Please advise,

Thanks always ,
Ani
Realistic Estimates: 800 Mn
ANIRBAN CHAKRABORTY (PMP, SSGB)

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