Using the Following Figures, What Is the Incremental Crash Cost

question 6

Multiple Choice

Using the following figures, what is the incremental crash cost for this project activity?
Normal time = 6 months, Crash time = 4 months
Normal cost = $27,000, Crash cost = $35,000

• A) $16,000 per month
• B) $8,000 per month
• C) $4,000 per month
• D) $6,000 per month
• E) None of the above

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Definitions:

Normal Approximation

A method used to approximate the distribution of various sample statistics to the normal distribution under certain conditions.

Nonzero Differences

Refers to the outcomes in statistical analyses where the differences between compared measures or values are not equal to zero, indicating variability or effect.

Binomial Distribution

The binomial distribution is a probability distribution that summarizes the likelihood of obtaining a fixed number of successes in a fixed number of trials in a binary context, where there are only two possible outcomes.

Sign Test

A non-parametric test used to determine if the median of a population differs from a specified value by examining the signs (+, -, =) of the differences rather than their magnitudes.