The accuracy of an estimate can be improved by considering uncertainty and risk.
PERT uses 3 estimates to define a range for an activity’s cost. This formula can be used for cost estimating and for scheduling.
Most likely – based on a realistic assessment
Optimistic – estimated cost based on the best-case scenario
Pessimistic – estimated cost based on the worst-case scenario
The PERT estimate, also called the 3 Point Estimate, is determined using the following formula:
