CAPM Cost Management 2

Question 1

A project manager is reviewing a project with a BAC of $100,000, EV of $60,000, and AC of $70,000. What is the Cost Performance Index (CPI)?

Accepted Answer

0.86

Answer

CPI = EV / AC = $60,000 / $70,000 = 0.857, rounded to 0.86, indicating the project is over budget.

Question 2

Which cost estimating technique relies on historical data from similar past projects to predict current project costs?

Accepted Answer

Analogous estimating

Answer

Analogous estimating uses historical data from similar projects as a basis for estimating current project costs.

Question 3

A project has SPI of 1.2 and CPI of 0.9. What does this indicate?

Accepted Answer

Ahead of schedule and over budget

Answer

SPI > 1 means ahead of schedule, while CPI < 1 means over budget.

Question 4

What is the Estimate to Complete (ETC) when using the formula ETC = (BAC - EV) / CPI?

Accepted Answer

Remaining work priced at the current efficiency rate

Answer

ETC = (BAC - EV) / CPI calculates the cost of remaining work based on current cost performance efficiency.

Question 5

During project execution, the team discovers a $5,000 cost overrun on a $50,000 budget. Which document should be updated first?

Accepted Answer

Issue log

Answer

Cost variances should be logged in the issue log first for tracking and analysis before initiating a change request.

CAPM Practice Test