Question 108 from Oliver Lehmann 175Qs

Submitted by danny2012 on Thu, 06/07/2012 - 08:31

108. Your project exceeded costs in the past caused by an underestimation of resource costs in the cost baseline: PV: $1,200,000, EV: $1,000,000, AC: $1,200,000 You expect the underestimation to influence the future as much as it did in the past. If the value of the remaining work (BAC – EV) is at $1,000,000, what should be your new EAC (estimate at completion)?


o $1,800,000
o $2,000,000
o $2,200,000
o $2,400,000


Answer says to use "EAC forecast for ETC work considering both SPI and CPI factors", i.e. AC + [(BAC-EV)/CPI*SPI]. Why? The question's scenario seems not to meet the application condiction of the formula. I think the other formula is more suitable: AC + [(BAD-EV)/CPI]. Do you thinks so?

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sspawar

Thu, 06/07/2012 - 12:52

EAC = AC + ETC

CPI at current point  = EV/AC = 1000000/1200000

Trend will be same in future

ETC  = Remaining work  (BAC- EV) / CPI = 1000000/1000000/1200000 = 1200000

EAC = AC+ETC = 1200000+1200000 = 2400000, ans would be D

 

sspawar

Fri, 06/08/2012 - 00:27

When Planned deadline is a constraint or condition to complete project, and in any point of time , project is running ahead or behind with any SPI, along with any CPI, then in that case, you apply this formula for EAC :

EAC = AC + [(BAC-EV)/(SPI*CPI)]

But in question it not asked to complete at scheduled date.

hence formula will be applied only with CPI.

Regards

danny2012

Fri, 06/08/2012 - 10:30

yes, it didn't mention schedule factor. That's why I'm confused by the explanation of it. Thanks anyway.