A Company Wants to Use CPM Analysis to Manage Their

question 38

Multiple Choice

A company wants to use CPM analysis to manage their project.One of the activities that make up the project has an uncertain duration.Three estimates have been given to determine this activity's duration.The estimates are optimistically 1 hour,most likely 5 hours and pessimistic 6 hours.Using the three activity time estimation procedure for CPM,what is the expected time this activity will take?

• A)2.5 hours
• B)3.5 hours
• C)4.5 hours
• D)5.5 hours
• E)None of the above

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Definitions:

Consumer Surplus

The difference between the total amount that consumers are willing and able to pay for a good or service and the total amount they actually pay.

Equilibrium Price

The market price at which the quantity of goods supplied is equal to the quantity of goods demanded, resulting in no excess supply or demand.

Willing To Pay

The maximum amount a consumer is prepared to spend on a good or service, reflecting their valuation and demand.

Maximum Prices

Price caps set by the government on certain goods and services to protect consumers from excessive prices.