Posted: September 4th, 2013
Project risks & calculation
30% probability of delay of receipt of resources – cost $50,000.
20% probability that the resources will be $10,000 cheaper than planned.
25% probability that there will be a problem integrating with existing software, cost to fix $3,500.
30% probability that the development may be simpler than expected, savings $2,500.
.How much should you plan for your contingency reserve budget based on the above?
What are your assumptions about these reserves?