Project Management Professional (PMP) Practice Exam

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Study for the Project Management Professional (PMP) exam. Study with flashcards and multiple choice questions. With over 500 questions. Practice the PMP practice multiple choice questions. Updated for 2023-2025. Get ready for your exam!

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Your project had a cost overrun in the past and you tried to obtain funding on top of the original budget at completion (BAC). Management has told you that they cannot make additional funding available. You have to increase cost performance so that the project will be finished with costs not exceeding the original BAC. Which metric describes the future performance to meet this objective?

TCPI calculated as BAC / CPI
TCPI calculated as (BAC-EV) / (EAC – AC)
TCPI calculated as (BAC-EV) / (BAC-AC)
TCPI cannot be calculated in this situation.

The correct answer is: TCPI calculated as (BAC-EV) / (BAC-AC)

TCPI calculated as (BAC-EV) / (BAC-AC) would best describe the future performance to meet this objective. This formula compares the budget at completion (BAC) to the current value of the project (EV) and the actual costs incurred so far (AC). By dividing the difference between the BAC and EV by the difference between the BAC and AC, the result shows how efficiently the project will need to be managed in order to meet the original budget at completion. Option A is incorrect because it uses the current cost performance index (CPI) to calculate TCPI, which does not take into account the original budget. Option B is also incorrect because it subtracts EV from BAC, which would result in a negative value in this scenario. Option D is incorrect because TCPI can always be calculated using the BAC, EV, and AC values,