statistics project

1. Decide your 10 steps

2. For each step: Decide the type of distribution it will take to complete that step. How much will that step cost? (Base these on logic, market prices, internet searches, etc. – try to be accurate but don’t stress if it’s just an estimate for this project!)

3. Set up the excel spreadsheet. Color code and LABEL 2 columns for each step: one for the distribution and one for the random numbers. Above these: describe the distribution shape and label the alpha, beta, starting and ending points.

4. Create the random numbers for each step (10,000 trials). Lock them in place (do not allow them to change) by copying the column, right click, paste as Values (symbol has “123”).

5. Now create the correct beta distributions for each step using the random numbers generated for that step

6. Run descriptives on each step – what was the mean time needed for each step? What was the min/max? Double check the distribution you chose.

7. Decide what your total formula is for Time Needed (Time = completion of each step but watch for forks in the model)

8. Calculate the time needed for each trail

9. Run descriptives on Total Time Needed including a histogram.

10. Consider the “How Lucky” rule and decide how long you want to ask the investors for. (80%, 50%, 10% of Time Needed???)

11. Now that you have the time needed for each step, open a new sheet and add in the estimated cost for each step. Report these by week 1, week 2, etc. Calculate the estimated total cost per week.

12. Create a column for estimated Revenue per week. Then make a column for Net Profit and Cumulative Profit

13. Graph these so you can tell your investor when they might see a return on their investment.

14. Create your report.