PCC PCC Earned Value Management 1 — Questions and Answers
Question 1: In Earned Value Management (EVM), the Planned Value (PV) represents:
- The authorized budget for work actually completed
- The authorized budget for work scheduled to be completed by a given date (Correct answer)
- The actual cost incurred for work performed
- The difference between budgeted and actual costs
Correct answer: The authorized budget for work scheduled to be completed by a given date
Planned Value (PV) is the portion of the approved project budget planned to be spent up to a specific point in time based on the schedule.
Question 2: A project has a Budget at Completion (BAC) of $500,000, an Earned Value (EV) of $200,000, and actual costs (AC) of $250,000. What is the Cost Variance (CV)?
- -$50,000 (Correct answer)
- $50,000
- -$300,000
- $300,000
Correct answer: -$50,000
CV = EV − AC = $200,000 − $250,000 = −$50,000, indicating the project is over budget for the work performed.
Question 3: A Schedule Performance Index (SPI) of 0.85 indicates that the project:
- Is 15% ahead of schedule
- Is completing only 85 cents of planned work for every dollar of schedule (Correct answer)
- Has spent 15% more than budgeted
- Will finish 15% under budget
Correct answer: Is completing only 85 cents of planned work for every dollar of schedule
SPI = EV/PV; a value of 0.85 means the project is accomplishing only 85% of the planned schedule progress, indicating it is behind schedule.
Question 4: Which EVM metric is used to forecast the total cost of the project at completion?
- Budget at Completion (BAC)
- Estimate at Completion (EAC) (Correct answer)
- Estimate to Complete (ETC)
- Variance at Completion (VAC)
Correct answer: Estimate at Completion (EAC)
The Estimate at Completion (EAC) is the forecasted total project cost based on current performance trends and remaining work estimates.
Question 5: The Control Account (CA) in an EVM system is best described as:
- A financial account used to pay project vendors
- A management control point where scope, schedule, and budget are integrated for performance measurement (Correct answer)
- The total budget allocated to a project phase
- A reserve fund for risk mitigation
Correct answer: A management control point where scope, schedule, and budget are integrated for performance measurement
A Control Account is the intersection of the Work Breakdown Structure (WBS) and Organizational Breakdown Structure (OBS), where EVM metrics are measured and managed.
Question 6: In EVM, the To-Complete Performance Index (TCPI) based on BAC measures:
- The cost efficiency needed for the remaining work to meet the original budget (Correct answer)
- The schedule efficiency achieved to date on the project
- The ratio of earned value to planned value
- The forecasted cost variance at project completion
Correct answer: The cost efficiency needed for the remaining work to meet the original budget
TCPI (BAC) = (BAC − EV) / (BAC − AC), representing the cost efficiency required on remaining work to complete within the original budget.
PCC PCC Earned Value Management 1
In Earned Value Management (EVM), the Planned Value (PV) represents: