Practical Spreadsheet Risk Modeling for Management

116 Practical Spreadsheet Risk Modeling for Management

information to suggest whether some values are more likely than others for

a parameter.

The Triangle distribution is commonly used to model expert opinion and

uses three parameters: the minimum, most likely, and maximum values.

We prefer the use of the PERT distribution, however, because the mean and

standard deviation of the PERT are less sensitive to extreme values for the

minimum and maximum. For example, experts may provide extremely

small minima or large maxima and the mean of the Triangle distribution is

greatly affected by these. In contrast, the PERT distribution is less