A project manager is creating the monthly report for top management. The project manager has collected the information below:
AC = 100
PV = 80
EV = 120
Based on this information, the CPI reflects which of the following about the project?
A. It is under budget.
B. It is over budget.
C. It is ahead of schedule.
D. It is behind schedule.
The cost performance index is a ratio that measures the financial effectiveness of a project by dividing the budgeted cost of work performed by the actual cost of work performed. If the result is more than 1, as in 1.25, then the project is under budget, which is the best result. A CPI of 1 means the project is on budget, which is also a good result. A CPI of less than 1 means the project is over budget. This represents a risk in that the project may run out of money before it is completed.
Answer is A.
Answer is B
120/100 = 1.2