CCT Earned Value Management 2 — Questions and Answers
Question 1: Which Estimate at Completion (EAC) formula is used when the current CPI is expected to continue for the remainder of the project?
- EAC = BAC + (BAC - EV)
- EAC = AC + (BAC - EV)
- EAC = BAC / CPI (Correct answer)
- EAC = AC + ETC
Correct answer: EAC = BAC / CPI
When current cost efficiency (CPI) is expected to remain constant, EAC = BAC / CPI, projecting final cost based on how efficiently budget has been used so far.
Question 2: The To-Complete Performance Index (TCPI) based on BAC is calculated as:
- (BAC - EV) / (BAC - AC) (Correct answer)
- (EV - AC) / (BAC - EV)
- (BAC - AC) / (BAC - EV)
- (AC - EV) / (BAC - AC)
Correct answer: (BAC - EV) / (BAC - AC)
TCPI = (BAC - EV) / (BAC - AC); it represents the cost efficiency that must be achieved on remaining work to meet the original budget.
Question 3: What does Variance at Completion (VAC) measure?
- The difference between planned and actual start dates
- The difference between BAC and the Estimate at Completion (Correct answer)
- The ratio of earned value to actual cost
- The total amount of approved changes
Correct answer: The difference between BAC and the Estimate at Completion
VAC = BAC - EAC; it projects how much over or under the original budget the project is expected to finish.
Question 4: If EV = $120,000 and PV = $140,000, what is the Schedule Variance (SV)?
- +$20,000
- -$20,000 (Correct answer)
- +$260,000
- -$260,000
Correct answer: -$20,000
SV = EV - PV = $120,000 - $140,000 = -$20,000, indicating $20,000 worth of planned work has not yet been completed.
Question 5: The Estimate to Complete (ETC) when current CPI is expected to continue is calculated as:
- ETC = BAC - EV
- ETC = (BAC - EV) / CPI (Correct answer)
- ETC = EAC - BAC
- ETC = AC / CPI
Correct answer: ETC = (BAC - EV) / CPI
ETC = (BAC - EV) / CPI estimates the cost to complete remaining work at the current spending efficiency rate.
Question 6: Actual Cost (AC) in EVM terminology is also known as:
- Budgeted Cost of Work Performed (BCWP)
- Budgeted Cost of Work Scheduled (BCWS)
- Actual Cost of Work Performed (ACWP) (Correct answer)
- Estimate to Complete (ETC)
Correct answer: Actual Cost of Work Performed (ACWP)
Actual Cost (AC) is the traditional term ACWP—Actual Cost of Work Performed—representing real expenditures incurred for completed work.
Question 7: A TCPI value greater than 1.0 indicates that:
- The remaining work must be performed more efficiently than current performance (Correct answer)
- The project is under budget and ahead of schedule
- Future work can be performed less efficiently and still meet the budget
- The project has been completed within the approved budget
Correct answer: The remaining work must be performed more efficiently than current performance
A TCPI > 1.0 means the efficiency required to complete remaining work exceeds current performance, indicating the original budget is increasingly difficult to meet.
CCT Earned Value Management 2
Which Estimate at Completion (EAC) formula is used when the current CPI is expected to continue for the remainder of the project?