- A
EAC = BAC / CPI
Why wrong: This assumes the cost variance is typical and will continue, which is not the case.
- B
EAC = AC + [(BAC - EV) / (CPI * SPI)]
Why wrong: This formula considers both cost and schedule performance, but schedule is on track and variance is atypical.
- C
EAC = AC + (BAC - EV)
This formula is used when past cost variances are not expected to continue.
- D
EAC = AC + ETC
Why wrong: ETC would need to be re-estimated, but given the one-time variance, the formula is most appropriate.
Question 694 of 892
PMP Process — Managing Technical Aspects Practice Question
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.
Your IT infrastructure project is running 15% over budget at the midpoint. After analyzing the variance, you find that the cost overrun is due to a one-time increase in licensing fees that will not recur. The project is on schedule. What is the BEST estimate for the Estimate at Completion (EAC)?
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
✓
EAC = AC + (BAC - EV)
Option C is correct because the cost overrun is due to a one-time increase in licensing fees that will not recur, meaning the remaining work will be performed at the original budgeted rate. This scenario calls for the EAC formula that adds the actual costs incurred to the remaining budget (BAC - EV), which assumes future cost performance will match the planned rate. This is the 'atypical variance' formula, as the cause of the variance is not expected to continue.
Key principle: Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
EAC = BAC / CPI
Why it's wrong here
This assumes the cost variance is typical and will continue, which is not the case.
- ✗
EAC = AC + [(BAC - EV) / (CPI * SPI)]
Why it's wrong here
This formula considers both cost and schedule performance, but schedule is on track and variance is atypical.
- ✓
EAC = AC + (BAC - EV)
Why this is correct
This formula is used when past cost variances are not expected to continue.
Related concept
Read the scenario before looking for a memorised answer.
- ✗
EAC = AC + ETC
Why it's wrong here
ETC would need to be re-estimated, but given the one-time variance, the formula is most appropriate.
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates often default to the typical variance formula (EAC = BAC / CPI) without recognizing that the question explicitly states the cost overrun is due to a one-time event that will not recur, making the atypical formula the correct choice.
Detailed technical explanation
How to think about this question
In earned value management (EVM), the choice of EAC formula depends on whether the variance is typical (expected to continue) or atypical (one-time). For atypical variances, the formula EAC = AC + (BAC - EV) is used because it assumes the remaining work will be completed at the original budgeted rate, effectively resetting performance expectations. This is critical in IT projects where one-time cost spikes (e.g., licensing fee hikes, hardware price surges) should not distort future cost forecasting.
KKey Concepts to Remember
- Read the scenario before looking for a memorised answer.
- Find the constraint that changes the correct option.
- Eliminate answers that are true in general but not in this case.
TExam Day Tips
- Watch for words such as best, first, most likely and least administrative effort.
- Review why wrong options are wrong, not only why the correct option is correct.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
How this comes up in practice
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
Got this wrong? Here's your next step.
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
Questions learners often ask
What does this PMP question test?
Process — Managing Technical Aspects — This question tests Process — Managing Technical Aspects — Read the scenario before looking for a memorised answer..
What is the correct answer to this question?
The correct answer is: EAC = AC + (BAC - EV) — Option C is correct because the cost overrun is due to a one-time increase in licensing fees that will not recur, meaning the remaining work will be performed at the original budgeted rate. This scenario calls for the EAC formula that adds the actual costs incurred to the remaining budget (BAC - EV), which assumes future cost performance will match the planned rate. This is the 'atypical variance' formula, as the cause of the variance is not expected to continue.
What should I do if I get this PMP question wrong?
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
What is the key concept behind this question?
Read the scenario before looking for a memorised answer.
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Last reviewed: Jul 4, 2026
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