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PMI-SP Exam - Topic 4 Question 117 Discussion

You are the project manager of a project that has a budget of $875,000 and you have completed 40 percent of the project work. Due to some errors, however, you have actually spent $425,000 of the budget. Management wants to know what the project's cost performance index is. What value do you report?
C) .82
A) -$75,000
B) $350,000
D) -$187,500

PMI-SP Exam - Topic 4 Question 117 Discussion

Actual exam question for PMI's PMI-SP exam
Question #: 117
Topic #: 4
[All PMI-SP Questions]

You are the project manager of a project that has a budget of $875,000 and you have completed 40 percent of the project work. Due to some errors, however, you have actually spent $425,000 of the budget. Management wants to know what the project's cost performance index is. What value do you report?

Show Suggested Answer Hide Answer
Suggested Answer: C

Cost performance index (CPI) is used to calculate performance efficiencies. It is used in trend analysis

to predict future performance. CPI is the

ratio of earned value to actual cost. The CPI is calculated based on the following formula:

CPI = Earned Value (EV) / Actual Cost (AC)

If the CPI value is greater than 1, it indicates better than expected performance, whereas if the value

is less than 1, it shows poor

performance. The CPI value of 1 indicates that the project is right on target. In this instance it's

$350,000 divided by $425,000 for a CPI

of .82.

Answer option B is incorrect. $350,000 is the earned value of the project.

Answer option A is incorrect. -$75,000 is the cost variance for the project.

Answer option D is incorrect. -$187,500 is the predicted variance at the completion of the project.


by Helaine at May 30, 2026, 03:42 AM

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Jeannetta
I think the CPI should be around .82 based on my calculations, but I need to double-check my math on the actual costs.
upvoted 0 times
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Graciela
5 days ago
I feel like I might be mixing up the formulas, but isn't the earned value just the budget times the percent complete?
upvoted 0 times
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Gwenn
10 days ago
I remember a similar question where we had to find the CPI. If I recall correctly, it's earned value divided by actual cost.
upvoted 0 times
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Kattie
15 days ago
I think the cost performance index is calculated using earned value and actual cost, but I'm not entirely sure how to apply it here.
upvoted 0 times
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