Quick Answer
The correct answer is that the project is over budget but ahead of schedule. This conclusion comes directly from interpreting CPI and SPI values in earned value management: a CPI of 0.8 means for every dollar spent, only $0.80 of work is earned, signaling a cost overrun, while an SPI of 1.1 means $1.10 of work is earned for every dollar of planned work, indicating the project is ahead of schedule. On the CAPM exam, this question tests your ability to quickly read these indices without calculation—a common trap is confusing the direction of the values, such as thinking a CPI below 1.0 is good. Remember the memory tip: “CPI under 1, cost underdone; SPI over 1, schedule overrun” (or for this case, SPI over 1 means schedule ahead).
This CAPM practice question tests your understanding of project management fundamentals and core concepts. Compare every option against the stated constraints before choosing — the best answer satisfies all requirements, not just the most obvious one. After answering, compare your reasoning against the explanation and wrong-answer breakdown below. Once you have made your selection, read the full explanation to reinforce the concept and understand why each distractor is designed to mislead on exam day.
A project manager is assigned to a project that is in execution phase. The project has a cost performance index (CPI) of 0.8 and a schedule performance index (SPI) of 1.1. Which of the following best describes the current status of the project?
Clue words in this question
Noticing these words before you look at the options changes how you read each choice.
Clue: "best"
Why it matters: Signals that multiple options may be partially correct. Choose the option that most directly solves the exact problem described, not the one that sounds most complete.
The project is under budget and ahead of schedule.
Why wrong: CPI < 1 means over budget, not under.
The project is under budget and behind schedule.
Why wrong: Both indices are opposite of this statement.
The project is over budget but ahead of schedule.
CPI=0.8 (<1) indicates cost overrun; SPI=1.1 (>1) indicates ahead of schedule.
The project is over budget and behind schedule.
Why wrong: SPI > 1 means ahead of schedule, not behind.
Answer choices
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
The project is over budget but ahead of schedule.
A CPI of 0.8 means the project is earning only $0.80 for every $1.00 spent, indicating it is over budget. An SPI of 1.1 means the project is earning $1.10 for every $1.00 of planned work, indicating it is ahead of schedule. Therefore, the project is over budget but ahead of schedule, making option C correct.
Key principle: Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Answer analysis
For each option: why learners choose it and why it is or isn't the right answer here.
The project is under budget and ahead of schedule.
Why it's wrong here
CPI < 1 means over budget, not under.
The project is under budget and behind schedule.
Why it's wrong here
Both indices are opposite of this statement.
The project is over budget but ahead of schedule.
Why this is correct
CPI=0.8 (<1) indicates cost overrun; SPI=1.1 (>1) indicates ahead of schedule.
Clue confirmation
The clue word "best" in the question point toward this answer.
Related concept
Read the scenario before looking for a memorised answer.
The project is over budget and behind schedule.
Why it's wrong here
SPI > 1 means ahead of schedule, not behind.
Common exam traps
The trap here is that candidates often confuse the direction of the indices, incorrectly assuming a CPI less than 1 means under budget or an SPI greater than 1 means behind schedule, when in fact CPI < 1 indicates over budget and SPI > 1 indicates ahead of schedule.
Detailed technical explanation
CPI and SPI are derived from Earned Value Management (EVM) calculations: CPI = EV/AC and SPI = EV/PV. A CPI of 0.8 means the cost variance (CV = EV - AC) is negative, indicating cost overrun. An SPI of 1.1 means the schedule variance (SV = EV - PV) is positive, indicating the project is ahead of schedule. In practice, a project can be ahead of schedule but over budget if tasks are being completed faster than planned but at a higher cost, such as due to overtime or expedited shipping.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
A practitioner preparing for the CAPM exam encounters this exact type of scenario on the job. The correct answer here is not the most general option — it is the best answer for the specific constraint described. Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option. Real exam questions reward reading the full scenario before eliminating options, because the constraint defines which answer fits.
What to study next
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
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FAQ
Project Management Fundamentals and Core Concepts — This question tests Project Management Fundamentals and Core Concepts — Read the scenario before looking for a memorised answer..
The correct answer is: The project is over budget but ahead of schedule. — A CPI of 0.8 means the project is earning only $0.80 for every $1.00 spent, indicating it is over budget. An SPI of 1.1 means the project is earning $1.10 for every $1.00 of planned work, indicating it is ahead of schedule. Therefore, the project is over budget but ahead of schedule, making option C correct.
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
Yes — watch for: "best". Signals that multiple options may be partially correct. Choose the option that most directly solves the exact problem described, not the one that sounds most complete.
Read the scenario before looking for a memorised answer.
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Last reviewed: Jun 11, 2026
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