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PMI Exam PMI-SP Topic 6 Question 10 Discussion
Topic #: 6
Maurice is the project manager of the NHQ Project and his project team has just finished the project activities. The quality control team reports that the project deliverables are perfect. The only thing left to in the project is to verify scope. This process will be performed by the project stakeholders. Maurice is required to submit a final project report and report on the project performance. Maurice's project had a budget of $234,000 but the project spent $245,000. In the final report management wants to know the project's cost performance index (CPI). What value should Maurice report?
Cost performance index (CPI) is used to calculate performance efficiencies. It is used in
trend analysis to predict future performance. CPI is the
ratio of earned value to actual cost. The CPI is calculated based on the following formula:
CPI = Earned Value (EV) / Actual Cost (AC)
If the CPI value is greater than 1, it indicates better than expected performance, whereas if the value
is less than 1, it shows poor
performance. The CPI value of 1 indicates that the project is right on target. In this instance, the
earned value is $234,000 as the project
work is 100 percent. The actual costs are $245,000.
Answer option D is incorrect. This is the schedule performance index value.
Answer option A is incorrect. This is the variance at completion for the project.
Answer option C is incorrect. There is enough information to find the answer.
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