Project Management Earned Value Management (EVM) 3

Question 1

A project has BAC = $500,000, CPI = 0.90, and is 60% complete by EV. A new EAC is needed assuming past performance continues. What is the EAC?

Accepted Answer

$555,556

Answer

EAC = BAC / CPI = $500,000 / 0.90 ≈ $555,556, reflecting that inefficiency will persist through project completion.

Question 2

Which of the following best describes the Variance at Completion (VAC)?

Accepted Answer

The projected difference between BAC and EAC

Answer

VAC = BAC - EAC; it predicts whether the project will be over or under budget at the end.

Question 3

A project manager observes CPI = 0.75 and SPI = 0.85. What is the most accurate conclusion?

Accepted Answer

The project is both over budget and behind schedule

Answer

CPI < 1 means over budget and SPI < 1 means behind schedule, so both performance dimensions are unfavorable.

Question 4

What is the primary purpose of the Performance Measurement Baseline (PMB) in EVM?

Accepted Answer

To provide the integrated scope, schedule, and cost baseline against which project performance is measured

Answer

The PMB integrates scope, schedule, and cost and serves as the reference point for measuring project performance variances.

Question 5

A work package has a BAC of $10,000, is 50% complete by EV, and has spent $6,000. What is the Cost Variance (CV)?

Accepted Answer

-$1,000

Answer

EV = 50% × $10,000 = $5,000; CV = EV - AC = $5,000 - $6,000 = -$1,000, indicating a cost overrun.

Project Management Practice Test