PMI-SP Earned Value 3 — Questions and Answers
Question 1: A project has CPI = 0.90 and SPI = 1.10. Which statement best describes the project's status?
- Over budget and behind schedule
- Over budget but ahead of schedule (Correct answer)
- Under budget but behind schedule
- Under budget and ahead of schedule
Correct answer: Over budget but ahead of schedule
CPI < 1.0 means over budget (spending more than earned), while SPI > 1.0 means ahead of schedule (earning more than planned).
Question 2: A PMI-SP practitioner uses a composite EAC formula that weights both CPI and SPI. Which formula reflects this approach?
- EAC = AC + (BAC - EV)
- EAC = AC + [(BAC - EV) / (CPI × SPI)] (Correct answer)
- EAC = BAC / CPI
- EAC = AC + ETC
Correct answer: EAC = AC + [(BAC - EV) / (CPI × SPI)]
The composite EAC = AC + [(BAC - EV) / (CPI × SPI)] accounts for both cost and schedule performance inefficiencies in forecasting.
Question 3: During a project status review, EV equals PV. What does this tell the project manager?
- The project is on budget
- The project is on schedule (Correct answer)
- The project is over budget
- The project has no cost variance
Correct answer: The project is on schedule
When EV = PV, SV = 0 and SPI = 1.0, meaning the project is progressing exactly as scheduled.
Question 4: What is the primary purpose of Earned Value Management (EVM) in project scheduling?
- To calculate the project's return on investment
- To integrate scope, schedule, and cost performance into a single framework (Correct answer)
- To determine the critical path of a project
- To allocate resources across project activities
Correct answer: To integrate scope, schedule, and cost performance into a single framework
EVM integrates scope, time, and cost baselines to provide an objective measure of project performance and progress.
Question 5: A project team reports that $75,000 of planned work has been completed, but $90,000 was spent. The planned budget for this period was $80,000. What is the cost variance?
- -$15,000 (Correct answer)
- +$5,000
- -$10,000
- +$15,000
Correct answer: -$15,000
CV = EV - AC = $75,000 - $90,000 = -$15,000, indicating the project is $15,000 over budget for the work accomplished.
Question 6: What does TCPI (To-Complete Performance Index) measure when calculated against BAC?
- The actual cost efficiency achieved to date
- The required cost efficiency for remaining work to finish within the original budget (Correct answer)
- The forecasted cost at project completion
- The ratio of completed work to planned work
Correct answer: The required cost efficiency for remaining work to finish within the original budget
TCPI (BAC) = (BAC - EV) / (BAC - AC), showing the efficiency needed for remaining work to stay within the original budget.
Question 7: In EVM, which baseline serves as the time-phased budget against which project performance is measured?
- Cost Baseline
- Performance Measurement Baseline (PMB) (Correct answer)
- Scope Baseline
- Quality Baseline
Correct answer: Performance Measurement Baseline (PMB)
The Performance Measurement Baseline (PMB) is the time-phased budget that integrates scope and cost for EVM tracking.
PMI-SP Earned Value 3
A project has CPI = 0.90 and SPI = 1.10.
Which statement best describes the project's status?