CAPM Earned Value Management 2 — Questions and Answers
Question 1: A project has a Budget at Completion (BAC) of $100,000 and is 60% complete. The Planned Value (PV) is $70,000 and the Actual Cost (AC) is $65,000. What is the Earned Value (EV)?
- $60,000 (Correct answer)
- $65,000
- $70,000
- $100,000
Correct answer: $60,000
EV = BAC × % complete = $100,000 × 0.60 = $60,000.
Question 2: Which EVM metric directly measures the efficiency of the budget used for the work performed?
- Schedule Performance Index (SPI)
- Cost Performance Index (CPI) (Correct answer)
- Schedule Variance (SV)
- Cost Variance (CV)
Correct answer: Cost Performance Index (CPI)
CPI = EV / AC measures how efficiently the budget is being spent relative to the work accomplished.
Question 3: A project has EV = $40,000 and PV = $50,000. What does this indicate?
- The project is ahead of schedule
- The project is behind schedule (Correct answer)
- The project is under budget
- The project is on schedule
Correct answer: The project is behind schedule
SV = EV − PV = $40,000 − $50,000 = −$10,000, indicating the project is behind schedule.
Question 4: What does an SPI of 1.2 indicate about a project?
- The project is 20% over budget
- The project is 20% behind schedule
- The project is 20% ahead of schedule (Correct answer)
- The project is 20% under budget
Correct answer: The project is 20% ahead of schedule
SPI = EV / PV; an SPI > 1.0 means the project is progressing faster than planned.
Question 5: The Estimate to Complete (ETC) represents which of the following?
- Total funds authorized for the project
- Expected cost to finish remaining project work (Correct answer)
- Difference between BAC and AC
- Total cost variance at completion
Correct answer: Expected cost to finish remaining project work
ETC is the expected cost needed to complete all remaining project work from the current point forward.
Question 6: If BAC = $200,000 and CPI = 0.8, what is the Estimate at Completion (EAC) using the typical EAC formula?
- $160,000
- $200,000
- $240,000
- $250,000 (Correct answer)
Correct answer: $250,000
EAC = BAC / CPI = $200,000 / 0.8 = $250,000, assuming future work continues at the current cost efficiency.
Question 7: Which of the following best defines the Performance Measurement Baseline (PMB)?
- The original project budget before any changes
- The approved integrated scope-schedule-cost plan used to measure project performance (Correct answer)
- The sum of all actual costs incurred
- The total earned value at project completion
Correct answer: The approved integrated scope-schedule-cost plan used to measure project performance
The PMB is the approved time-phased plan integrating scope, schedule, and cost against which project execution is compared.
CAPM Earned Value Management 2
A project has a Budget at Completion (BAC) of $100,000 and is 60% complete.
The Planned Value (PV) is $70,000 and the Actual Cost (AC) is $65,000.
What is the Earned Value (EV)?