PMI-RMP · Question #117
You are the project manager of the NHQ project for your company. Management has told you that you must implement an agreed upon contingency response if the Cost Performance Index in your project is le
The correct answer is B. 0.91. To calculate CPI, use the formula: CPI = EV / AC. First, calculate Earned Value (EV): EV = BAC × Actual % Complete = $250,000 × 0.60 = $150,000. The Actual Cost (AC) is given as $165,000. Therefore: CPI = $150,000 / $165,000 = 0.909, which rounds to 0.91. Since the threshold is C
Question
You are the project manager of the NHQ project for your company. Management has told you that you must implement an agreed upon contingency response if the Cost Performance Index in your project is less than 0.90. Consider that your project has a budget at completion of $250,000 and is 60 percent complete. You are scheduled to be however, 75 percent complete, and you have spent $165,000 to date. What is the Cost Performance Index for this project to determine if the contingency response should happen?
Options
- A-$37,500
- B0.91
- C0.88
- D0.80
How the community answered
(20 responses)- A10% (2)
- B80% (16)
- C5% (1)
- D5% (1)
Explanation
To calculate CPI, use the formula: CPI = EV / AC. First, calculate Earned Value (EV): EV = BAC × Actual % Complete = $250,000 × 0.60 = $150,000. The Actual Cost (AC) is given as $165,000. Therefore: CPI = $150,000 / $165,000 = 0.909, which rounds to 0.91. Since the threshold is CPI < 0.90, and the calculated CPI of 0.91 is above 0.90, the contingency response is NOT triggered. Note: the scheduled completion of 75% is used to calculate Schedule Performance Index (SPI), not CPI. The $37,500 in option A represents the cost variance, not the CPI.
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