Earned Value Management: Measure Project Performance and Forecast Outcomes

Question 1

Which of the following accurately describes the advantages of Earned Value Management (EVM)?

Accepted Answer

EVM offers real-time insights into project progress.

Accepted Answer

EVM assists in early identification of project risks and issues.

Accepted Answer

EVM aids in optimizing resource allocation and reducing project expenses.

Answer

EVM adds complexity and administrative overhead to projects.

Question 2

Which of the following is NOT a fundamental component of Earned Value Management (EVM)?

Accepted Answer

Net Present Value (NPV)

Answer

Planned Value (PV)

Answer

Actual Cost (AC)

Answer

Earned Value (EV)

Question 3

Which of the following is NOT a component of Earned Value Management (EVM)?

Accepted Answer

Return on Investment (ROI)

Answer

Planned Value (PV)

Answer

Actual Cost (AC)

Answer

Earned Value (EV)

Question 4

What is the primary purpose of the Schedule Variance (SV)?

Accepted Answer

To assess the difference between planned and actual progress

Answer

To identify potential delays or risks

Answer

To calculate the earned value of a work package

Answer

To estimate the project completion date

Question 5

Which of the following is a potential limitation of EVM?

Accepted Answer

Reliance on accurate and timely data

Answer

Complexity in calculations

Answer

Inability to predict future project outcomes

Answer

Only applicable to large projects

Question 6

Calculate Schedule Performance Index (SPI) using which formula?

Accepted Answer

SPI = EV / PV

Answer

SPI = PV / EV

Answer

SPI = AC / PV

Answer

SPI = EV / AC

Question 7

What does a negative Cost Performance Index (CPI) represent?

Accepted Answer

Actual costs exceeding baseline costs

Answer

Actual costs below baseline costs

Answer

Earned value exceeding planned value

Answer

Schedule ahead of plan

Question 8

What is the purpose of a Variance at Completion (VAC)?

Accepted Answer

Estimating the total cost overrun or underrun of a project

Answer

Calculating the time remaining to complete a project

Answer

Identifying the critical path of a project

Answer

Determining the earned value of a project

Question 9

How do Earned Value Management (EVM) techniques help predict project outcomes?

Accepted Answer

By analyzing earned value trends to forecast future costs and schedules.

Answer

By using past project data to make future estimates.

Answer

By identifying and assessing potential risks and challenges.

Answer

By calculating the project's return on investment.

Question 10

Which of the following is a known limitation of Earned Value Management (EVM)?

Accepted Answer

EVM is not well-suited for projects with an uncertain scope.

Accepted Answer

EVM does not provide insights into the root causes of project variances.

Answer

EVM is only applicable to large-scale projects.

Answer

EVM is overly complex and challenging for most project teams to use effectively.

Question 11

What is the significance of the Cost Performance Index (CPI)?

Accepted Answer

It measures cost-effectiveness and efficiency

Answer

It indicates the project's overall financial performance

Answer

It predicts the project's final cost

Answer

It determines the project's timeliness

Question 12

What does a negative Schedule Variance (SV) indicate?

Accepted Answer

The project is behind schedule

Answer

The project is ahead of schedule

Answer

The project is on schedule

Answer

The project is under budget

Question 13

What is meant by Cost Variance Threshold?

Accepted Answer

The maximum allowable deviation in cost before corrective action is taken

Answer

The minimum acceptable level of cost performance

Answer

The estimated cost to complete the project

Answer

The actual cost incurred to date

Question 14

Earned Value Management is a technique for measuring:

Accepted Answer

Project performance

Answer

Project schedule performance only.

Answer

Project costs only

Question 15

What is the formula for calculating Earned Value (EV)?

Accepted Answer

Actual work performed (percent complete) * total planned value

Answer

Planned cost of work performed * actual cost of work performed

Answer

Actual cost of work performed / planned cost of work performed

Question 16

The difference between Earned Value and Actual Cost of Work Performed (ACWP) is known as:

Accepted Answer

Cost Variance (CV)

Answer

Performance Variance (PV)

Answer

Schedule Variance (SV)

Question 17

Schedule Variance (SV) measures the difference between:

Accepted Answer

Earned Value and Planned Value

Answer

Actual Cost of Work Performed and Budgeted Cost of Work Performed

Answer

Earned Value and Actual Work Performed

Question 18

Which of the following is an advantage of using EVM?

Accepted Answer

It provides early warning of potential project problems

Answer

It guarantees project success

Answer

It eliminates the need for project planning

Question 19

The Cost Performance Index (CPI) is used to assess:

Accepted Answer

Efficiency of project cost performance

Answer

Accuracy of project cost estimates

Answer

Effectiveness of project schedule performance

Question 20

In EVM, Planned Value (PV) represents:

Accepted Answer

The budgeted cost of work scheduled

Answer

The actual cost of work completed

Answer

The estimated cost of work remaining

Question 21

Which method is used to forecast project completion date using EVM?

Accepted Answer

Estimate at Completion (EAC)

Answer

Critical Path Method (CPM)

Answer

PERT analysis