Quick Answer
The answer is 0.91. The Cost Performance Index (CPI) is calculated by dividing Earned Value (EV) by Actual Cost (AC), so with an EV of $50,000 and an AC of $55,000, the CPI equals 50,000 divided by 55,000, which is 0.909, rounding to 0.91. This metric is central to earned value management because it measures cost efficiency; a CPI below 1.0, as seen here, means the project is over budget—you are spending more than the value of work completed. On the Project Management Professional PMP exam, you will often see CPI tested alongside Schedule Performance Index (SPI) in scenario-based questions, and a common trap is confusing AC with Planned Value (PV). Remember, CPI always uses EV in the numerator and AC in the denominator, so a simple memory tip is “CPI = EV over AC, if it’s less than one, your budget’s done.”
This PMP practice question tests your understanding of process — managing technical aspects. Read the scenario carefully and evaluate each option against the stated constraints before committing to an answer. 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 using earned value management. At month 6 of a 12-month project, the EV is $50,000, PV is $60,000, and AC is $55,000. What is the cost performance index (CPI)?
0.83
Why wrong: 0.83 is SPI (EV/PV), not CPI.
1.20
Why wrong: 1.20 is AC/PV = 55,000/60,000.
0.91
CPI = EV/AC = 50,000/55,000 = 0.909 ≈ 0.91.
1.10
Why wrong: 1.10 is the reciprocal of CPI (AC/EV).
Answer choices
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
0.91
The Cost Performance Index (CPI) is calculated as EV / AC. Here, EV = $50,000 and AC = $55,000, so CPI = 50,000 / 55,000 = 0.909, which rounds to 0.91. A CPI less than 1 indicates the project is over budget, as the cost incurred ($55,000) exceeds the value of work performed ($50,000).
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.
0.83
Why it's wrong here
0.83 is SPI (EV/PV), not CPI.
1.20
Why it's wrong here
1.20 is AC/PV = 55,000/60,000.
0.91
Why this is correct
CPI = EV/AC = 50,000/55,000 = 0.909 ≈ 0.91.
Related concept
Read the scenario before looking for a memorised answer.
1.10
Why it's wrong here
1.10 is the reciprocal of CPI (AC/EV).
Common exam traps
The trap here is that candidates often confuse CPI with SPI, mistakenly dividing EV by PV (which gives SPI) instead of EV by AC, leading to the incorrect answer 0.83 (Option A).
Detailed technical explanation
CPI is a key Earned Value Management (EVM) metric that measures cost efficiency by comparing the budgeted cost of work performed (EV) to the actual cost incurred (AC). A CPI of 0.91 means the project is only getting $0.91 of work done for every $1 spent, indicating a cost overrun. In real-world projects, a sustained CPI below 1 often triggers corrective actions like re-estimating costs or reallocating resources to bring the project back on budget.
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 PMP 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
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FAQ
Process — Managing Technical Aspects — This question tests Process — Managing Technical Aspects — Read the scenario before looking for a memorised answer..
The correct answer is: 0.91 — The Cost Performance Index (CPI) is calculated as EV / AC. Here, EV = $50,000 and AC = $55,000, so CPI = 50,000 / 55,000 = 0.909, which rounds to 0.91. A CPI less than 1 indicates the project is over budget, as the cost incurred ($55,000) exceeds the value of work performed ($50,000).
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
Read the scenario before looking for a memorised answer.
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Last reviewed: Jun 11, 2026
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