What is Burn Rate ?

Saw this question on BURN RATE on Oliver Lehmann. What is it and how do we calculate it?. Thanks for any help. 

Burn rate = AC/EV

Burn Rate=1/CPI

Where CPI is cost performance index.

 

 

A project was assessed and the following Earned value data have been found: PV: $750,000 EV: $750,000 AC: $900,000 What is the Burn rate of the project?

o 1.20

o 1.10

o 1.00

o 0.83 

 

Burn Rate =900,000/750,00=1.2

 

ok So Burn Rate Formula is AC/EV ?

 

What is Burn rate in other word ?

What it is usefull for ?

 

thanks

its the rate you are burning through your money.  Its common term for CPI,  The CPI stands for Cost Performance Index, which is equal to Earned Value / Actual Cost. You'll need to know CPI. For the Earned Value questions

I tought the burn rate was also CPI or EV/AC

But Oliver Lehmann Q87/175

A project was assessed and the following earned value data have been found: PV: $750,000 EV: $750,000 AC: $900,000 What is the burn rate of the project?87
o 1.20
o 1.10
o 1.00
o 0.83

Answer : 1
Monitoring and controlling Answer: 1 Reference: Project Management, A Systems Approach to Planning, Scheduling and Controlling by H. Kerzner, 10th edition, page 647,

IT'S AC/EV

Can you help ?

in that question the burn rate is .83  Oliver is wrong. You get what you pay for I guess. I only used prep question I paid for.  

 

 

If I Google, i found many answer different answer from Burn rate

Doesn't matter, What matters is what the earn value formulas are, what they mean and when to apply each. 

ok but, if the exam ask what is the burn rate.. you are in  trouble..

 

I am wondering if burn rate is EV/ac  or AC/ev

 

Admin can help on this one ?

 

There is many contradictions on the internet,  Lehmann says AC/EV

ok, I did some checking for you, and talk to a few other PMPs I work with.  The consensus was PMI would mostly have Burn Rate = 1 / CPI

for butn rate.   AC/EV isn't consider as the propert formula.  the Lehmann answer would be correct.   It was also assume they would not test on the term burn rate, but good to know.

ok but be carefull here

 

You said  Burn Rate = 1/CPI   and AC/EV  is'int correct

This is the same thing !!    1/CPI  or AC/EV   = SAME !

 

EX:

 

AC = 5

EV = 6

 

CPI = 6/5 = 1,2

1/CPI     OR   1 / 1,2     = 0,8333 

AC/EV  OR    5/6         = 0,8333

 

SO   burn Rate  is NOT CPI,    BURN Rate is like Lehman says   AC/EV   OR 1/CPI

 

 

Yes, Burn rate is not CPI, it is the inverse of CPI.  Lehman is correct

nice post