EVM EVM Forecasting and Completion Estimates 1 — Questions and Answers
Question 1: What does EAC stand for in EVM?
- Estimate at Completion (Correct answer)
- Earned at Completion
- Expenditure at Completion
- Expected Actual Cost
Correct answer: Estimate at Completion
EAC (Estimate at Completion) is the expected total cost of the project when all work is finished.
Question 2: The most commonly used EAC formula, assuming current CPI will continue, is:
- BAC / CPI (Correct answer)
- AC + (BAC - EV)
- AC + (BAC - EV) / CPI
- AC + ETC
Correct answer: BAC / CPI
EAC = BAC / CPI is the standard formula when assuming the current cost efficiency trend will continue for the remaining work.
Question 3: ETC stands for which EVM term?
- Estimate to Complete (Correct answer)
- Earned to Complete
- Expected Time to Completion
- Estimated Total Cost
Correct answer: Estimate to Complete
ETC (Estimate to Complete) represents the expected cost required to finish all remaining project work.
Question 4: Variance at Completion (VAC) is calculated as:
- BAC - EAC (Correct answer)
- EAC - BAC
- BAC - AC
- EV - EAC
Correct answer: BAC - EAC
VAC = BAC - EAC; a positive VAC indicates the project will finish under budget, while a negative VAC signals a cost overrun.
Question 5: If BAC = $500,000 and CPI = 0.80, what is the EAC using the CPI-based formula?
- $625,000 (Correct answer)
- $400,000
- $580,000
- $500,000
Correct answer: $625,000
EAC = BAC / CPI = $500,000 / 0.80 = $625,000, meaning the project is forecast to overrun by $125,000.
Question 6: The formula EAC = AC + (BAC - EV) assumes:
- Remaining work will be performed at the originally budgeted rate (Correct answer)
- Remaining work will be performed at the current CPI rate
- Remaining work will be performed at the combined CPI × SPI rate
- The original estimate was fundamentally flawed
Correct answer: Remaining work will be performed at the originally budgeted rate
This EAC formula assumes the remaining work will be accomplished exactly as originally budgeted, with no further over- or under-runs.
EVM EVM Forecasting and Completion Estimates 1
What does EAC stand for in EVM?