Cost question

Submitted by pmasp1 on Wed, 11/30/2011 - 22:56

You’re managing a construction project to install 7,500 light switches in a new high-rise building.
You’ve installed 3,575 of them so far, and you’ve spent $153,500 of your total budget of $245,000. Which
of the following is true?
A. The AC is $153,500, so I’m ahead of schedule
B. The ETC is $168,995, so I’m within by budget
C. The CV is $36,880, so I’ve exceeded my budget
D. The CPI is .7597, so I’m within my budget

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nmarkous13

Thu, 12/01/2011 - 01:42

 since Budget is $245,000 for 7,500 light Switches

One Switch cost = $245,000 / 7,500 = $32.67 

EV = $32.67 * 3,575 = $116,783.34

AC = $153,500

 

CPI = EV/AC = 116,783.34/153,500 = 0.76

CV= EV-AC = 116,783.34-153,500 = -36,716.67

So, you are exceeding the budget (mean choice B and D are incorrect)

Choice C can't be correct because CV is +ve which is incorrect too..

which makes A is the best choice as AC is 153,500 which no idication to the Schedule which you might be head of.

 

Hope this is correct answer.. I will let others confirm ;-)

 

kmrk

Thu, 12/01/2011 - 03:29

I am fine with all your formulas and calculations but I think the "A" might not be the answer, by knwing AC how can we decide the schedule? But I dont have the right answer :(

 

nmarkous13

Thu, 12/01/2011 - 12:37

Actually in this question, I think the best way is to eleminate the definitely wrong answers and choose the best one..

 

We are sure B, C and D can't be correct so A is the best answer, he didn't mention anything about Schedule.. so might be correct and might be incorrect but all other questions are for sure incorrect...

 

Maybe someone else correct me... :)

 

pmasp1

Thu, 12/01/2011 - 15:05

This is the Headfirst question and answer to my surprise is D ...

I went with C ..because it is the case of exceeding budget and CV i got is -36,880 ...I still feel i got the question right ..Let me know if anyone feels other answer ?

 

 

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bunnynbear

Mon, 01/09/2012 - 22:02

I think none of above is correct. C is seems the closest because the cost overruns but the number should be a negative number.


anyone knows why the answer is D??


Please help.

abhi742

Tue, 01/10/2012 - 09:24

Obviously the budget has exceeded and so C stands close to reality, but the value of CV is positive. So, the next best choice is A, which states the correct value of AC, and with the rest of the statement not proven incorrect...


since the question is which of the statement is true, A is the closest to truth.. my vote for A..