All Five Members of a Project Team Add 20% to Their

question 95

Multiple Choice

All five members of a project team add 20% to their individual serial activities as a safety margin and submit their time estimates to the project manager.The manager adds the activity length estimates together and adds 20% for his personal safety margin.Then,anticipating a cut by top management,he adds another 20% to his final project estimate.The executive level of the organization just completed a retreat where they read The One Minute Manager,Who Moved My Cheese,and Critical Chain.They return from their retreat both energized and much wiser in the ways of project management.They know that everyone has been routinely adding 20% and want to scale the project back to an unpadded estimate.How much should they cut?

• A)42%
• B)60%
• C)33%
• D)27%

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Definitions:

Probability

The measure of the likelihood that an event will occur, expressed as a number between 0 (impossible) and 1 (certain).

Foreclosed

The legal process by which an owner's right to a property is terminated, usually due to failure to meet mortgage payment obligations.

Vickrey Auction

A sealed-bid auction where the highest bidder wins but pays the second-highest bid price.

Willingness To Pay

The maximum amount an individual is ready to spend for a good or service.