The Cost Performance Index (CPI) in Earned Value Management is defined as:
Choose the correct answer
CPI = Actual Cost / Planned Value
CPI = Earned Value / Actual Cost (CPI > 1 = under budget; CPI < 1 = over budget)
CPI = Planned Value / Earned Value
CPI = Actual Cost / Budget at Completion
Correct Answer
B. CPI = Earned Value / Actual Cost (CPI > 1 = under budget; CPI < 1 = over budget)
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EVM: EV (Earned Value) = % work done x Budget; AC = Actual Cost spent; PV = Planned Value (budgeted work scheduled to date). CPI = EV/AC: > 1 under budget; < 1 over budget. SPI = EV/PV: > 1 ahead of schedule. EAC (Estimate at Completion) = BAC/CPI (if current efficiency continues).
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