PK0-005 Tools and Documentation Practice Question
A project has a BAC of $200,000. After three months, the earned value (EV) is $80,000 and the actual cost (AC) is $90,000. What is the cost variance (CV) and what does it indicate?
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
CV = -$10,000; the project is over budget
CV = EV - AC = $80,000 - $90,000 = -$10,000. Negative CV means over budget.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✓
CV = -$10,000; the project is over budget
Why this is correct
Correct calculation and interpretation.
- ✗
CV = $10,000; the project is ahead of schedule
Why it's wrong here
Incorrect sign and interpretation.
- ✗
CV = $10,000; the project is under budget
Why it's wrong here
Incorrect sign; AC > EV.
- ✗
CV = -$10,000; the project is behind schedule
Why it's wrong here
CV is cost, not schedule.
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