Cost and Time Management Flashcards

A construction project has a BAC of $500,000, EV of $200,000, and AC of $250,000. What is the Cost Performance Index (CPI)?

Answer: 0.80

CPI = EV / AC = $200,000 / $250,000 = 0.80, indicating the project is over budget.

Which scheduling technique uses probability distributions to model activity duration uncertainty?

Answer: PERT

PERT uses optimistic, most likely, and pessimistic duration estimates with weighted averages to model uncertainty.

The Estimate at Completion (EAC) formula assuming future work will proceed at the budgeted rate is:

Answer: AC + (BAC - EV)

EAC = AC + (BAC - EV) assumes remaining work will be completed at the originally planned cost rate.

A contractor uses fast-tracking on a project. What is the primary risk associated with this technique?

Answer: Increased rework due to overlapping activities

Fast-tracking overlaps activities that were planned sequentially, increasing the risk of rework if earlier work must be revised.

Which cost estimating technique uses a statistical relationship between historical data and project variables?

Answer: Parametric estimating

Parametric estimating uses statistical relationships such as cost per square foot or cost per unit based on historical data.

A project's Schedule Variance (SV) is -$30,000. What does this indicate?

Answer: The project is $30,000 behind schedule in value terms

SV = EV - PV; a negative SV means the project has earned less value than planned, indicating it is behind schedule.

What is the purpose of a Schedule Performance Baseline in construction project management?

Answer: To provide an approved time-phased plan for measuring schedule performance

The schedule performance baseline is the approved version of the schedule model used as a basis for comparison to actual results.