PMP Formulae Flashcards
Beta distribution method
CE = (cO+4cM+cP)/6
CE= expected cost
CO=optimistic cost
CM=Most likely cost
CP=Pessimistic cost
Note: standard deviation = (P-O)/6
Triangular distribution method
CE = (cO+cM+cP)/3
CE= expected cost
CO=optimistic cost
CM=Most likely cost
CP=Pessimistic cost
What is planned value?
The authorised budget assigned to scheduled work. The value of the work planned to be completed at a point in time
What is earned value?
The measure of work performed expressed in terms of the budget authorised for that work
What is actual cost?
The realized cost incurred for the work performed on an activity during a specific time period
What is budget at completion?
The sum of all budgets established for the work to be performed (the project cost baseline)
What is cost variance?
The difference between the value of the work completed and the actual costs to the same point in time
CV = EV - AC
Positive > under planned costs
What is schedule variance?
The amount by which the project is ahead or behind the planned delivery date, at a given point in time, expressed as the difference between the earned value and the planned value
SV = EV - PV
Positive > ahead of schedule
What is variance at completion?
A pro=jection of the amount of budget deficit or surplus, expressed as the difference between the budget at completion and the estimate at completion
VAC=BAC - EAC
Positive > under planned cost
What is the Cost Performance Index?
A measure of the cost efficiency
CPI = EV / AC
Bigger than 1 > under planned cost
What is the Schedule Performance Index?
A measure of schedule efficiency
SPI = EV / PV
Bigger than 1 > ahead of schedule
What is the Estimate At Completion?
The expected total cost of completing all work. This can be calculated in different ways:
- Planned rate: EAC = AC + BAC - EV
- Initial plan no longer valid: EAC = AC + ETC(new)
- Continue at the same rate: BAC/CPI
- If influenced by both CPI and SPI: EAC = AC + (BAC - EV)/(CPI x SPI)
What is the Estimate To Complete?
The expected cost to finish all the remaining project work
ETC=EAC - AC
What is the To Complete Performance Index?
A measure of the cost performance that must be achieved with the remaining resources in order to meet a specified management goal
1. To complete on plan: TCPI = (BAC-EV)/(BAC-AC)
If greater than 1 > harder to complete
2. To complete current EAC: TCPI=(BAC-EV)/(EAC-AC)
If greater than 1 > harder to complete
How do you calculate present value?
PV = FV / (1+r)^n
FV= future value
R=interest rate
n=number of time periods
