A project manager is evaluating the cost performance of a project and has the following data: Budget at Completion (BAC) is $200,000 and the Cost Performance Index (CPI) is 0.8. Using the formula EAC = BAC / CPI, what is the Estimate at Completion (EAC) for the project?
The correct EAC is found using the formula EAC = BAC / CPI. Plugging in the values, EAC = $200,000 / 0.8, which results in $250,000. This indicates that, given the current cost performance index, the total project cost at completion is expected to be higher than originally budgeted.
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