On a project with an Earned Value (EV) of $300,000 and an Actual Cost (AC) of $350,000, what is the Cost Performance Index (CPI)?
1.00
0.86
1.17
0.75
The Cost Performance Index (CPI) is calculated using the formula CPI = EV / AC. Given that the Earned Value (EV) is $300,000 and the Actual Cost (AC) is $350,000, the CPI would be $300,000 / $350,000, which equals approximately 0.86. This means that for every dollar spent, only $0.86 of value is earned, indicating a cost efficiency below 1, which signals that the project is over budget.
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