1.

Based on the most likely cost estimates, what is the expected cost of
the building the house, and how does it compare to the budget?
Estimated cost with all optional features: $370,900.00
Estimated cost without any optional features: $349,983.33
Budget: $350,000.00
2. Simulate the cost of building the house in @Risk or similar software.
What is the expected cost of building the house using this method?
How do you reconcile any differences between this and your answer to
#1?
The mean value comes to $370,899.97 which is slightly less than the
original estimate after running 10,000 simulations.
The difference is due to the variance if we try to run it with lesser
number of simulations

3. What are the minimum and maximum amounts the Smiths can expect
to spend on the house?
Minimum amount without any optional items: $283,950.00
Minimum amount with all optional items: $299,700.00
Maximum amount without any optional items: $435,000.00
Maximum amount with all optional items: $463,000

4. Assuming that the Smiths want to be 90% certain the cost of the home
will not exceed $375,000, which of the optional features should they
include?
They should include only Countertops or only Flooring if they want to
be 90% certain