what is burn rate?

87. 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=1/CPI

BURN RATE=1/CPI

CPI = EV/AC

=> Burn rate = AC/EV = 900,000/750,000 = 1.2


Perhaps part of your question has to do with understanding the relationship between burn rate and Earned Value Management. PMI has an article on this topic. It's free if you are a member. Please see http://marketplace.pmi.org/Pages/ProductDetail.aspx?GMProduct=00100294501 for more information.

CPI is 1 so if they are asking about Burn Rate not sure this is the answer.

pmcoe's picture

CPI is not 1

when CPI is
EV/AC
than this is here
750.000/900.000
equals 0.83

when burn rate is 1/CPI=0,83
then burn rate is 1.2

what i wanna know:
could anybody explain where we need to know this burn rate for and what tells it difference in comparison to the CPI.
Like i udnerstand tna tells a burn rate higher than 1, that the project "eats" budget faster than it should and we would end up over budget, right?
But that is the same what CPI less than 1 tells us, isn't it?
I do not really get the point.
Any thoughts?

btw: Since this "burn rate" is wether mentioned in the PMBok Guide neither not in any of the Prep Book Guides i know so far, i assume we do not really need to know about, do we?