CAPM (Certified Associate in Project Management) Practice Exam

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How is a beta distribution characterized compared to triangular distribution?

Similar shape but inverted
It gives more weight to the most likely estimate
It gives equal weight to all estimates
It is primarily used for risk management

The correct answer is: It gives more weight to the most likely estimate

The correct answer is B. A beta distribution gives more weight to the most likely estimate compared to a triangular distribution. In a beta distribution, the most likely estimate is assigned a higher probability compared to extreme values, resulting in a distribution that is skewed towards the most likely estimate. This characteristic makes the beta distribution useful when there is more confidence in the central estimate compared to extreme values. The other options are not correct: A. Triangular and beta distributions do not have similar shapes, nor is one an inversion of the other. C. In a beta distribution, not all estimates are given equal weight as each estimate can have a different probability assigned to it. D. While the beta distribution can be used in risk management, it is not its primary purpose.