The PV is $1000, EV is $2000 and AC is $1500. What is CPI?

The correct answer is A. 1.33. CPI (Cost Performance Index) = EV ÷ AC = $2000 ÷ $1500 = 1.33, making option A correct - a CPI above 1.0 means you're getting more value than you're spending, so the project is under budget. Option B (2.00) confuses CPI with SPI (Schedule Performance Index): EV ÷ PV = $2000 ÷…

Project Control

Question

Options

A1.33
B2.00
C0.75
D0.5

How the community answered

(51 responses)

A
73% (37)
B
14% (7)
C
10% (5)
D
4% (2)

Explanation

CPI (Cost Performance Index) = EV ÷ AC = $2000 ÷ $1500 = 1.33, making option A correct - a CPI above 1.0 means you're getting more value than you're spending, so the project is under budget.

Option B (2.00) confuses CPI with SPI (Schedule Performance Index): EV ÷ PV = $2000 ÷ $1000 = 2.00 measures schedule efficiency, not cost. Option C (0.75) inverts the formula, calculating AC ÷ EV instead of EV ÷ AC. Option D (0.5) inverts the SPI formula (PV ÷ EV), which has nothing to do with cost performance.

Memory tip: "Earned Value always goes on top" - both CPI and SPI use EV as the numerator; what changes is the denominator: CPI uses AC (cost), SPI uses PV (schedule/plan).

Topics

#CPI#earned value management#cost performance index#EVM formula

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