ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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QUESTION TWO (2)
Assume you are managing a one-year project and have listed the project earned management
value as below. Note that PV is the planned value, EV is the earned value, AC is the actual cost,
and BAC is the budget at completion.
PV = $25,000
EV = $22,000
AC = $27,000
BAC = $122,500
Review the project and answer the following to find your project status.
a. Calculate the following for the project.
i. Cost variance
ii. Schedule variance
iii. Cost performance index (CPI )
iv. Schedule performance index (SPI)
b. Discuss the project status whether it is ahead of schedule or behind schedule and whether it
is under budget or over budget.
c. Use the CPI to calculate the estimate at completion (EAC) for this project. Is the project
performing better or worse than planned?
d. Use the SPI to estimate how long it will take to finish this project.
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