PK0-005 Tools and Documentation Practice Question
A project has a budget at completion (BAC) of $500,000. After 3 months, the earned value (EV) is $200,000, the actual cost (AC) is $250,000, and the planned value (PV) is $180,000. What is the cost performance index (CPI) 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
✓
CPI = 0.8, over budget
CPI = EV/AC = 200,000/250,000 = 0.8. A CPI less than 1 indicates the project is 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.
- ✓
CPI = 0.8, over budget
Why this is correct
Correct. CPI of 0.8 means for every dollar spent, only $0.80 of work is earned.
- ✗
CPI = 1.11, under budget
Why it's wrong here
1.11 would be AC/EV (250k/200k), not the correct formula.
- ✗
CPI = 0.8, behind schedule
Why it's wrong here
CPI measures cost efficiency, not schedule. Schedule performance is measured by SPI.
- ✗
CPI = 1.25, over budget
Why it's wrong here
1.25 is EV/PV (200k/180k), which is SPI, not CPI.
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