PGMP · Question #261
A program has a BAC of $1,750,000 and is expected to last two years. The program is currently at the third milestone which represents 35 percent of the program work. As it happens, this program has al
The correct answer is D. Schedule, because the program has a schedule performance index of .88.. Using Earned Value Management (EVM): EV (Earned Value) = 35% × $1,750,000 = $612,500; AC (Actual Cost) = $620,000; PV (Planned Value) = 40% × $1,750,000 = $700,000. The Schedule Performance Index (SPI) = EV ÷ PV = $612,500 ÷ $700,000 = 0.875, which rounds to 0.88. An SPI below 1.
Question
A program has a BAC of $1,750,000 and is expected to last two years. The program is currently at the third milestone which represents 35 percent of the program work. As it happens, this program has already spent $620,000 of the budget. Management is concerned that the program may also be slipping on schedule because the program should be forty percent complete by this time. Based on this information which type of performing is present in this scenario?
Options
- ACost, because the program has an estimate to complete of $1,151,429.
- BCost, because the program has a cost variance of -7,500
- CSchedule, because the program's planned value is only $700,000.
- DSchedule, because the program has a schedule performance index of .88.
How the community answered
(56 responses)- A9% (5)
- B2% (1)
- C4% (2)
- D86% (48)
Explanation
Using Earned Value Management (EVM): EV (Earned Value) = 35% × $1,750,000 = $612,500; AC (Actual Cost) = $620,000; PV (Planned Value) = 40% × $1,750,000 = $700,000. The Schedule Performance Index (SPI) = EV ÷ PV = $612,500 ÷ $700,000 = 0.875, which rounds to 0.88. An SPI below 1.0 confirms the program is behind schedule. While choice B is also mathematically correct (CV = EV − AC = $612,500 − $620,000 = −$7,500), management's stated concern is schedule slippage, and the SPI of 0.88 is the definitive metric for confirming that. Choice D correctly identifies the schedule problem with the accurate SPI value.
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