PMI-RMP · Question #27
Pete works as a project manager for BlueWell Inc. The Management has told him that he must implement an agreed-upon contingency response if the cost performance index in his project is less than…
The correct answer is A. 1.02. CPI = EV / AC. First, calculate EV: 65% complete × $275,000 BAC = $178,750. AC (actual cost spent) = $175,000. CPI = $178,750 / $175,000 = 1.021 ≈ 1.02. Since 1.02 > 0.90, the contingency response is NOT triggered. The scheduled completion (78%) is a distractor used to…
Question
Pete works as a project manager for BlueWell Inc. The Management has told him that he must implement an agreed-upon contingency response if the cost performance index in his project is less than 0.90. Consider that Pete's project has a budget at completion of $275,000. His project is 65 percent complete and he has spent $175,000 to date. However, Pete is scheduled to be 78 percent complete. What is the cost performance index for this project to determine if the contingency response should happen?
Options
- A1.02
- B0.96
- C0.90
- D0.89
How the community answered
(33 responses)- A76% (25)
- B15% (5)
- C6% (2)
- D3% (1)
Explanation
CPI = EV / AC. First, calculate EV: 65% complete × $275,000 BAC = $178,750. AC (actual cost spent) = $175,000. CPI = $178,750 / $175,000 = 1.021 ≈ 1.02. Since 1.02 > 0.90, the contingency response is NOT triggered. The scheduled completion (78%) is a distractor used to calculate SV, not CPI. CPI > 1.0 means the project is getting more value per dollar spent than planned (under budget). Option B (0.96) and D (0.89) result from incorrect calculations, and C (0.90) is the threshold itself, not the calculated value.
Topics
Community Discussion
No community discussion yet for this question.