CMA Final · Strategic Cost Management · Network Analysis - PERT, CPM
For a PERT activity, the optimistic time is 4 days, the most likely time is 7 days and the pessimistic time is 16 days. What are the expected time and the variance of the activity?
The expected time is 8 days and the variance is 4. The expected time is (4 + 4×7 + 16)/6 = 8. The variance is the square of (pessimistic − optimistic)/6, which is 2 squared, or 4. A figure of 2 would be the standard deviation.
- A8 days and 4Correct
- B9 days and 4
- C8 days and 2
- D7 days and 12
Explanation
Expected time = (4 + 4×7 + 16) / 6 = 48/6 = 8 days. Variance = ((16 − 4)/6)² = 2² = 4. The 9 days figure is a simple average of the three estimates. The 2 is the standard deviation, not the variance.
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