Time Mgt question

Submitted by Jigga on Sat, 05/03/2014 - 20:55
 
If you know the expected value is 500 and the standard deviation is 12, you can say with approximately a 95 percent confidence rating which of the following?
The activity will take from 488 to 512 days.
The activity will take from 464 to 536 days.
The activity will take from 494 to 506 days.
The activity will take from 476 to 524 days.
 
The answer is D. But my question is how did they arrive at this answer. Kindly show calculation steps? 
 
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philstinnet

Sat, 05/03/2014 - 21:17

The standard deviation is 12 days. Standard deviation is also called 'Sigma'.

The probability of a data point falling within the range of '+1' Sigma and '-1' Sigma = 68.27%

The probability of a data point falling within the range of  '+2' Sigma and '-2' Sigma = 95.45%

The probability of a data point falling within the range of '+3' Sigma and '-3' Sigma = 99.73%

The three lines mentioend above are the facts of a normally distributed curve. You have to remember and memorize the values. 

The question says '95% confidence rating', it means they are talking abuot two sigma range. One sigma is 12 days; therefore, two Sigma = 24 days.

Your mean or expected value is 500 days. Now, you have to add 24 days into 500, and subtract 24 days from 500. You will get a range. The range is going to be '476 to 524' days.

It means that there are 95% chances that the project (or the phase) will complete between 476 to 524 days. 

Hope it helps. 

 

sunku65

Sun, 05/04/2014 - 07:34

Please help some one:

what abt 6 sigma?  Is this 6 sigma valid for control charts or not?

I never see questions asking 6 sigma type variations in the control chart.

Is it possible  99.99985% of an activity completing in 428 to 572 days.

philstinnet

Mon, 05/05/2014 - 13:50

By reading your other post, it looks like you have already found the answer. 

The concept of Six Sigma (six standard deviation) came from the control chart. Higher the standard deviation, larger the range between Pessimistic and Optimistic estimate.

Six Sigma (including process shift) = 3.4 defects per 1 million data points.