Don't let Earned Value questions on the PMP Exam scare you. I have presented this method at the NWA PMI preparation classes for the PMP Exam since 2012. Instead of taking minutes and doing Math, you can answer in seconds, with confidence in seconds.

1. Martin Bailey October 2012 1

2. I fill a bathtub with water and provide a
teaspoon, cup, and bucket.
How do you empty the tub?
Martin Bailey October 2012 2

3. Formulas Getting all mumble-jumbled?
ETC = EAC–AC
EAC = BAC/Cumulative CPI
EV= %Complete*BAC
PERTPV (Planned Value)
CV (Cost Variance)
EV (Earned Value)
SPI (Schedule Performance Index)
EAC = AC+Bottom up ETC
VAC = BAC–EAC
n(n-1)/2
Martin Bailey October 2012 3

4. Is this how you feel?
Martin Bailey October 2012 4

5. Is this how you see the PMI questions?
Bob, a project manager for 25th Century Construction, is working
on his 535th project and is retiring after his 35th year. Using the
new distinctive sky blue Ford F-850 3 ton dump-truck his team
has delivered 4 miles of road consisting of 7/8 grade gravel in 4
months. Jenny, his associate, had planned for 5 miles of road in
this time period.
Is this project:
A. On time
B. Ahead of Schedule
C. Behind Schedule
D. Not enough information to determine

6. Don’t be scared of the Exam Questions
• In many cases you may reach for a calculator
and try to remember formulas when you don’t
need to.
• The goal of this presentation is to “demystify”
determining project status the easy way.
– On time, ahead of schedule, late
– On budget, under budget, overbudget
Martin Bailey October 2012 6

7. 1 2 3 4 5 6 7 8
PROJECT: a gravel (stone) road
Project Plan
8 Months long
10 miles of gravel
Cost of $80,000

8. 1 2 3 4 5 6 7 8
PROJECT: a gravel (stone) road
Project Plan
8 Months long
10 miles of gravel
Cost of $80,000
Simple budget plan:
$8,000 per mile planned cost
$10,000 per month budget
– example at end of 3rd month $30,000 planned budget
$10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000

9. Expected Completion 5 miles- PV
1 2 3 4 5 6 7 8
PROJECT: a gravel (stone) road
Project Plan
8 Months long, 10 miles of gravel BAC $80,000
$10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000
Completion – 5 miles EV
Cost of $40,00
4th month

10. Expected Completion 5 miles- PV
1 2 3 4 5 6 7 8
PROJECT: a gravel (stone) road
Project Plan
8 Months long, 10 miles of gravel BAC $80,000
$10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000
Completion – 5 miles EV
Cost of $40,00
4th month
What can we
tell from this?

11. Expected Completion 5 miles- PV
1 2 3 4 5 6 7 8
PROJECT: a gravel (stone) road
Project Plan
8 Months long, 10 miles of gravel BAC $80,000
$10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000
Completion – 5 miles EV
Cost of $40,00
4th month
On Schedule

12. Expected Completion 5 miles- PV
1 2 3 4 5 6 7 8
PROJECT: a gravel (stone) road
Project Plan
8 Months long, 10 miles of gravel BAC $80,000
$10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000
Completion – 5 miles EV
Cost of $40,00
4th month
On Budget

13. Expected Completion 5 miles- PV
1 2 3 4 5 6 7 8
PROJECT: a gravel (stone) road
Project Plan
8 Months long, 10 miles of gravel BAC $80,000
$10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000
Completion – 4 miles EV Behind
schedule
4th month PV = 5 miles at $40.00
EV = 4 miles
AC = $32,000

14. Expected Completion 5 miles- PV
1 2 3 4 5 6 7 8
PROJECT: a gravel (stone) road
Project Plan
8 Months long, 10 miles of gravel BAC $80,000
$10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000
Completion – 6 miles EV Ahead of schedule
Over budget
4th month PV = 5 miles at $40.00
EV = 6 miles
AC = $48,000

15. Understanding 4 Key Formulas
• Cost Variance
• Cost Performance Index
• Schedule Variance
• Schedule Performance Index
Martin Bailey October 2012 15

16. Understanding 4 Key Formulas
• Cost Variance
• Cost Performance Index
• Schedule Variance
• Schedule Performance Index
Variance means Difference
Or Subtraction
Martin Bailey October 2012 16

17. Understanding 4 Key Formulas
• Cost Variance
CV= EV - AC
• Cost Performance Index
• Schedule Variance
SV = EV - PV
• Schedule Performance Index
Variance means Difference
Or Subtraction
Cost Variance =
Earned Value – Actual Cost
Schedule Variance =
Earned Value – Planned Value
Martin Bailey October 2012 17

18. Understanding 4 Key Formulas
• Cost Variance
CV= EV - AC
• Cost Performance Index
• Schedule Variance
SV = EV - PV
• Schedule Performance Index
Helpful Hints:
BOTH subtract from Earned
Value
The Cost formulas include
“Cost” values
Cost Variance =
Earned Value – Actual Cost
Schedule Variance =
Earned Value – Planned Value
Martin Bailey October 2012 18

19. Understanding 4 Key Formulas
• Cost Variance
• Cost Performance Index
• Schedule Variance
• Schedule Performance Index
Index means Ratio or Fraction
Martin Bailey October 2012 19

20. Understanding 4 Key Formulas
• Cost Variance
• Cost Performance Index
CPI = EV / AC
• Schedule Variance
• Schedule Performance Index
SPI = EV / PV
Index means Ratio or Fraction
Martin Bailey October 2012 20

21. Understanding 4 Key Formulas
• Cost Variance
CV= EV - AC
• Cost Performance Index
CPI = EV / AC
• Schedule Variance
SV = EV - PV
• Schedule Performance Index
SPI = EV / PV
Helpful Hints:
The Cost formulas include
“Cost” values
Cost Variance =
Earned Value – Actual Cost
Cost Performance Index =
Earned Value / Actual Cost
Martin Bailey October 2012 21

22. Understanding 4 Key Formulas
• Cost Variance
CV= EV AC
• Cost Performance Index
CPI = EV / AC
• Schedule Variance
SV = EV PV
• Schedule Performance Index
SPI = EV / PV
Helpful Hints:
The MAGIC function sign
Notice that to get CPI you
“tipped” the minus sign in CV
to make it a “divide by” sign
Notice that to get SPI you
“tipped” the minus sign in SV
to make it a “divide by” sign
This means:
Once you know CV
and SV you know CPI
& SPI !
Martin Bailey October 2012 22

23. What can EV, AC, & PV tell you
Without Calculations
EV = Earned Value
AC = Actual Cost
PV = Planned Value
Martin Bailey October 2012 23

24. What can EV, AC, & PV tell you
Without Calculations
EV = Earned Value
AC = Actual Cost
PV = Planned Value
What can we determine without
using the formulas for
CV, SV, CPI, SPI?
Martin Bailey October 2012 24

25. EV = Earned Value
AC = Actual Cost
What can EV, AC, & PV tell you
Without Calculations
• If EV = AC
– On budget
• If EV > AC
– Under Budget
– Positive Cost Variance
• If EV < AC
– Over Budget
– Negative Cost Variance
If EV =AC CV = EV-AC
CV = 0 (good)
CPI = EV/AC
CV = 1 (good)
If EV > AC CV = EV-AC
CV > 0 positive (good)
CPI = EV/AC
CPI > I (good)
If EV < AC CV = EV-AC
CV < 0 negative (bad)
CPI = EV/AC
CPI < I (bad)
Martin Bailey October 2012 25

26. EV = Earned Value
PV = Planned Value
What can EV, AC, & PV tell you
Without Calculations
• If EV = PV
– On schedule
• If EV > PV
– Ahead of Schedule
– Positive Schedule Variance
• If EV < PV
– Behind Schedule
– Negative Schedule Variance
If PV =AC SV = EV-PV
SV = 0 (good)
SPI = EV/PV
SV = 1 (good)
If EV > PV SV = EV-PV
SV > 0 positive (good)
SPI = EV/PV
SPI > I (good)
If EV < PV SV = EV-PV
SV < 0 negative (bad)
SPI = EV/PV
SPI < I (bad)
Martin Bailey October 2012 26

27. You’ve been hired by a large consulting
firm to evaluate a software project for
them. You have access to the CPI and
EV for the project, but not the AC. The
CPI is .92, and the EV is $172,500. How
much money has actually been spent
on the project?
A. $158,700
B. $172,500
C. $187,500
D. There is not enough information to
calculate the actual cost
Martin Bailey October 2012 27

28. You’ve been hired by a large consulting
firm to evaluate a software project for
them. You have access to the CPI and
EV for the project, but not the AC. The
CPI is .92, and the EV is $172,500. How
much money has actually been spent
on the project?
A. $158,700
B. $172,500
C. $187,500
D. There is not enough information to
calculate the actual cost
Did you
immediately try to
remember the
formula?
Martin Bailey October 2012 28

29. You’ve been hired by a large consulting
firm to evaluate a software project for
them. You have access to the CPI and
EV for the project, but not the AC. The
CPI is .92, and the EV is $172,500. How
much money has actually been spent
on the project?
A. $158,700
B. $172,500
C. $187,500
D. There is not enough information to
calculate the actual cost
First:
Take out the
"noise"
Martin Bailey October 2012 29

30. You’ve been hired by a large consulting
firm to evaluate a software project for
them. You have access to the CPI and
EV for the project, but not the AC. The
CPI is .92, and the EV is $172,500. How
much money has actually been spent
on the project?
A. $158,700
B. $172,500
C. $187,500
D. There is not enough information to
calculate the actual cost
Time for the
formula?
CPI = EV / AC
Martin Bailey October 2012 30

31. You’ve been hired by a large consulting
firm to evaluate a software project for
them. You have access to the CPI and
EV for the project, but not the AC. The
CPI is .92, and the EV is $172,500. How
much money has actually been spent
on the project?
A. $158,700
B. $172,500
C. $187,500
D. There is not enough information to
calculate the actual cost
CPI = EV / AC
Now where is my
Calculator?
Martin Bailey October 2012 31

32. You’ve been hired by a large consulting
firm to evaluate a software project for
them. You have access to the CPI and
EV for the project, but not the AC. The
CPI is .92, and the EV is $172,500. How
much money has actually been spent
on the project?
A. $158,700
B. $172,500
C. $187,500
D. There is not enough information to
calculate the actual cost
It is not that
difficult !
Use
Logic &
Understanding
to answer this in seconds
without a calculator.
Martin Bailey October 2012 32

33. You’ve been hired by a large consulting
firm to evaluate a software project for
them. You have access to the CPI and
EV for the project, but not the AC. The
CPI is .92, and the EV is $172,500. How
much money has actually been spent
on the project?
A. $158,700
B. $172,500
C. $187,500
D. There is not enough information to
calculate the actual cost
What does CPI
Mean?
CPI = Cost Performance Index
CPI of 1 means: we are getting
value equal to what we are
spending
CPI > 1 means that we are
getting more value than what
we are paying for. (Paying less
for more)
CPI < 1 means we are getting
less value than we are paying
for. (Paying more for less)
Martin Bailey October 2012 33

34. You’ve been hired by a large consulting
firm to evaluate a software project for
them. You have access to the CPI and
EV for the project, but not the AC. The
CPI is .92, and the EV is $172,500. How
much money has actually been spent
on the project?
A. $158,700
B. $172,500
C. $187,500
D. There is not enough information to
calculate the actual cost
CPI < 1 means we are
getting less value than
we are paying for.
(Paying more for less)
A CPI of .92 is less than
1. This means we are
paying more for less.
This means Costs are
greater than the
Earned Value.
Martin Bailey October 2012 34

35. You’ve been hired by a large consulting
firm to evaluate a software project for
them. You have access to the CPI and
EV for the project, but not the AC. The
CPI is .92, and the EV is $172,500. How
much money has actually been spent
on the project?
A. $158,700
B. $172,500
C. $187,500
D. There is not enough information to
calculate the actual cost
A CPI of .92 is less than
1. This means we are
paying more for less.
This means Costs are
greater than the
Earned Value.
Only one answer
indicates Costs Greater
Than Earned Value.
© Martin Bailey Sept 2012
Martin Bailey October 2012 35

36. You are managing a project with AC
= $25,100, ETC = $45,600, VAC = -
$2,600, BAC =$90,000, and EAC =
$92,100. Your sponsor asks you to
forecast how much money you
expect to spend on the remainder
of the project. Which is the BEST
estimate to use for this forecast?
A. $45,600
B. $87,400
C. $90,000
D. $92,100
Martin Bailey October 2012 36

37. You are managing a project with AC
= $25,100, ETC = $45,600, VAC = -
$2,600, BAC =$90,000, and EAC =
$92,100. Your sponsor asks you to
forecast how much money you
expect to spend on the remainder
of the project. Which is the BEST
estimate to use for this forecast?
A. $45,600
B. $87,400
C. $90,000
D. $92,100
Trying to
remember a
specific formula?
Ready to Reach for
a calculator?
Martin Bailey October 2012 37

38. You are managing a project with AC
= $25,100, ETC = $45,600, VAC = -
$2,600, BAC =$90,000, and EAC =
$92,100. Your sponsor asks you to
forecast how much money you
expect to spend on the remainder
of the project. Which is the BEST
estimate to use for this forecast?
A. $45,600
B. $87,400
C. $90,000
D. $92,100
It is not that
difficult !
Use
Logic &
Understanding
to answer this in seconds
without a calculator.
Martin Bailey October 2012 38

39. First Let’s look at key point
of the question.
You are managing a project with AC
= $25,100, ETC = $45,600, VAC = -
$2,600, BAC =$90,000, and EAC =
$92,100. Your sponsor asks you to
forecast how much money you
expect to spend on the remainder
of the project. Which is the BEST
estimate to use for this forecast?
A. $45,600
B. $87,400
C. $90,000
D. $92,100
Martin Bailey October 2012 39

40. First Let’s look at key point
of the question.
You are managing a project with AC
= $25,100, ETC = $45,600, VAC = -
$2,600, BAC =$90,000, and EAC =
$92,100. Your sponsor asks you to
forecast how much money you
expect to spend on the remainder
of the project. Which is the BEST
estimate to use for this forecast?
A. $45,600
B. $87,400
C. $90,000
D. $92,100
Martin Bailey October 2012 40

41. First Let’s look at key point
of the question.
You are managing a project with AC
= $25,100, ETC = $45,600, VAC = -
$2,600, BAC =$90,000, and EAC =
$92,100. Your sponsor asks you to
forecast how much money you
expect to spend on the remainder
of the project. Which is the BEST
estimate to use for this forecast?
A. $45,600
B. $87,400
C. $90,000
D. $92,100
how much money you expect to
spend on the remainder of the
project.
This sounds very much like,” Estimate
(of costs) to Completion”.
ETCis short for
Estimate to Completion
Martin Bailey October 2012 41

42. First Let’s look at key point
of the question.
You are managing a project with AC
= $25,100, ETC = $45,600, VAC = -
$2,600, BAC =$90,000, and EAC =
$92,100. Your sponsor asks you to
forecast how much money you
expect to spend on the remainder
of the project. Which is the BEST
estimate to use for this forecast?
A. $45,600
B. $87,400
C. $90,000
D. $92,100
how much money you expect to
spend on the remainder of the
project.
This sounds very much like,” Estimate
(of costs) to Completion”.
ETCis short for
Estimate to Completion
Martin Bailey October 2012 42

43. You are managing a construction
project to install new door frames in
an office building. You planned on
spending $12,500 on the project, but
your costs are higher than expected,
and now you’re afraid that your
project is spending too much money.
What number tells you the difference
between the amount of money you
planned on spending and what you’ve
actually spent so far on the project?
A. AC
B. SV
C. CV
D. VAC
Martin Bailey October 2012 43

44. First Step: get rid of the
"noise"
You are managing a construction
project to install new door frames in
an office building. You planned on
spending $12,500 on the project, but
your costs are higher than expected,
and now you’re afraid that your
project is spending too much money.
What number tells you the difference
between the amount of money you
planned on spending and what you’ve
actually spent so far on the project?
A. AC
B. SV
C. CV
D. VAC
Martin Bailey October 2012 44

45. Now to look at keywords
You are managing a construction
project to install new door frames in
an office building. You planned on
spending $12,500 on the project, but
your costs are higher than expected,
and now you’re afraid that your
project is spending too much money.
What number tells you the difference
between the amount of money you
planned on spending and what you’ve
actually spent so far on the project?
A. AC
B. SV
C. CV
D. VAC
Difference = Variance
Spending = Cost
So what we need
Cost Variance
Martin Bailey October 2012 45

46. Now to look at keywords
You are managing a construction
project to install new door frames in
an office building. You planned on
spending $12,500 on the project, but
your costs are higher than expected,
and now you’re afraid that your
project is spending too much money.
What number tells you the difference
between the amount of money you
planned on spending and what you’ve
actually spent so far on the project?
A. AC
B. SV
C. CV
D. VAC
Difference = Variance
Spending = Cost
So what we need
Cost Variance
CV = Cost Variance
Martin Bailey October 2012 46

47. You are managing a project with an EV
of $15,000, PV of $12,000, and AC of
$11,000. How would you BEST
describe this project?
A. The project is ahead of schedule and
within its budget
B. The project is behind schedule and
within its budget
C. The project is ahead of schedule and
over its budget
D. The project is behind schedule and
over its budget
Martin Bailey October 2012 47

48. You are managing a project with an EV
of $15,000, PV of $12,000, and AC of
$11,000. How would you BEST
describe this project?
A. The project is ahead of schedule and
within its budget
B. The project is behind schedule and
within its budget
C. The project is ahead of schedule and
over its budget
D. The project is behind schedule and
over its budget
Did you
immediately try to
remember the
formulas?
Martin Bailey October 2012 48

49. You are managing a project with an EV
of $15,000, PV of $12,000, and AC of
$11,000. How would you BEST
describe this project?
A. The project is ahead of schedule and
within its budget
B. The project is behind schedule and
within its budget
C. The project is ahead of schedule and
over its budget
D. The project is behind schedule and
over its budget
Did you
immediately try to
remember the
formulas?
CPI = EV / AC
SPI = EV /PV
Martin Bailey October 2012 49

50. You are managing a project with an EV
of $15,000, PV of $12,000, and AC of
$11,000. How would you BEST
describe this project?
A. The project is ahead of schedule and
within its budget
B. The project is behind schedule and
within its budget
C. The project is ahead of schedule and
over its budget
D. The project is behind schedule and
over its budget
Did you
immediately try to
remember the
formulas?
CPI = EV / AC
SPI = EV /PV
Reaching for your
calculator?
Martin Bailey October 2012 50

51. You are managing a project with an EV
of $15,000, PV of $12,000, and AC of
$11,000. How would you BEST
describe this project?
A. The project is ahead of schedule and
within its budget
B. The project is behind schedule and
within its budget
C. The project is ahead of schedule and
over its budget
D. The project is behind schedule and
over its budget
It is not that
difficult !
Use
Logic &
Understanding
to answer this in seconds
without a calculator.
Martin Bailey October 2012 51

52. EV = $15,000 – earned value
AC = $11,000 – actual cost
PV = $12,000 – planned value
A. The project is ahead of schedule and
within its budget
B. The project is behind schedule and
within its budget
C. The project is ahead of schedule and
over its budget
D. The project is behind schedule and
over its budget
Get rid of the “noise”
Martin Bailey October 2012 52

53. EV = $15,000 – earned value
AC = $11,000 – actual cost
PV = $12,000 – planned value
A. The project is ahead of schedule and
within its budget
B. The project is behind schedule and
within its budget
C. The project is ahead of schedule and
over its budget
D. The project is behind schedule and
over its budget
We earned more than
what it cost.
It cost less than we
planned to spend.
Martin Bailey October 2012 53

54. EV = $15,000 – earned value
AC = $11,000 – actual cost
PV = $12,000 – planned value
A. The project is ahead of schedule and
within its budget
B. The project is behind schedule and
within its budget
C. The project is ahead of schedule and
over its budget
D. The project is behind schedule and
over its budget
We earned more than
what it cost.
That means we are
under/ within budget
It cost less than we
planned to spend.
Martin Bailey October 2012 54

55. EV = $15,000 – earned value
AC = $11,000 – actual cost
PV = $12,000 – planned value
A. The project is ahead of schedule
and within its budget
B. The project is behind schedule and
within its budget
C. The project is ahead of schedule and
over its budget
D. The project is behind schedule and
over its budget
We earned more than
what it cost.
That means we are
under/ within budget
It cost less than we
planned to spend.
That means we are
ahead of schedule
Martin Bailey October 2012 55

56. You are managing a project with a total
budget of $450,000. According to the
schedule, your team should have completed
45% of the work by now. But at the latest
status meeting, the team only reported that
40% of the work has actually been
completed. The team has spent $165,000 so
far on the project. How would you BEST
describe this project?
A. The project is ahead of schedule and
within its budget
B. The project is behind schedule and within
its budget
C. The project is ahead of schedule and over
its budget
D. The project is behind schedule and over its
budget
Martin Bailey October 2012 56

57. You are managing a project with a total
budget of $450,000. According to the
schedule, your team should have completed
45% of the work by now. But at the latest
status meeting, the team only reported that
40% of the work has actually been
completed. The team has spent $165,000 so
far on the project. How would you BEST
describe this project?
A. The project is ahead of schedule and
within its budget
B. The project is behind schedule and within
its budget
C. The project is ahead of schedule and over
its budget
D. The project is behind schedule and over its
budget
Don’t be scared.
There are only 1
calculation and
logic involved.
Martin Bailey October 2012 57

58. The Easy Part
You are managing a project with a total budget
of $450,000. According to the schedule, your
team should have completed 45% of the work by
now. But at the latest status meeting, the team
only reported that 40% of the work has actually
been completed. The team has spent $165,000
so far on the project. How would you BEST
describe this project?
A. The project is ahead of schedule and within its
budget
B. The project is behind schedule and within its
budget
C. The project is ahead of schedule and over its
budget
D. The project is behind schedule and over its
budget
Martin Bailey October 2012 58

59. The Easy Part
You are managing a project with a total budget
of $450,000. According to the schedule, your
team should have completed 45% of the work by
now. But at the latest status meeting, the team
only reported that 40% of the work has actually
been completed. The team has spent $165,000
so far on the project. How would you BEST
describe this project?
A. The project is ahead of schedule and within its
budget
B. The project is behind schedule and within its
budget
C. The project is ahead of schedule and over its
budget
D. The project is behind schedule and over its
budget
You are behind
Schedule
Half of the answers
are gone!
Now we need 1
formula, a
calculator, and
logic.
Martin Bailey October 2012 59

60. You are managing a project with a total budget
of $450,000. According to the schedule, your
team should have completed 45% of the work by
now. But at the latest status meeting, the team
only reported that 40% of the work has actually
been completed. The team has spent $165,000
so far on the project. How would you BEST
describe this project?
A. The project is ahead of schedule and within its
budget
B. The project is behind schedule and within its
budget
C. The project is ahead of schedule and over its
budget
D. The project is behind schedule and over its
budget
You are behind
Schedule
Earned Value
EV = BAC * actual % complete
EV = $450,000 * 40%
EV = $180,000
Martin Bailey October 2012 60

61. You are managing a project with a total
budget of $450,000. According to the
schedule, your team should have
completed 45% of the work by now. But at
the latest status meeting, the team only
reported that 40% of the work has
actually been completed. The team has
spent $165,000 so far on the project. How
would you BEST describe this project?
A. The project is ahead of schedule and
within its budget
B. The project is behind schedule and
within its budget
C. The project is ahead of schedule and
over its budget
D. The project is behind schedule and over
its budget
You are behind
Schedule
EV = $180,000
AC = $165,000
Martin Bailey October 2012 61

62. You are managing a project with a total
budget of $450,000. According to the
schedule, your team should have
completed 45% of the work by now. But at
the latest status meeting, the team only
reported that 40% of the work has
actually been completed. The team has
spent $165,000 so far on the project. How
would you BEST describe this project?
A. The project is ahead of schedule and
within its budget
B. The project is behind schedule and
within its budget
C. The project is ahead of schedule and
over its budget
D. The project is behind schedule and over
its budget
You are behind
Schedule
EV = $180,000
AC = $165,000
Cost is less than
value, therefore
you are NOT over
budget
Martin Bailey October 2012 62

63. Which of the following cumulative
measures indicates that your project is
about 9% under budget.
A. The cumulative AC was 100, and the
cumulative EV was 110.
B. The cumulative PV was 100, and the
cumulative AC was 110.
C. The cumulative AC was 110, and the
cumulative EV was 100.
D. The cumulative EV was 100, and the
cumulative PV was 110.
Martin Bailey October 2012 63

64. Which of the following cumulative
measures indicates that your project is
about 9% under budget.
A. The cumulative AC was 100, and the
cumulative EV was 110.
B. The cumulative PV was 100, and the
cumulative AC was 110.
C. The cumulative AC was 110, and the
cumulative EV was 100.
D. The cumulative EV was 100, and the
cumulative PV was 110.
Understand the
question before
getting stuck on
formulas and reaching
for the calculator.
This will make life
easier.
Martin Bailey October 2012 64

65. Which of the following cumulative
measures indicates that your project is
about 9% under budget.
A. The cumulative AC was 100, and the
cumulative EV was 110.
B. The cumulative PV was 100, and the
cumulative AC was 110.
C. The cumulative AC was 110, and the
cumulative EV was 100.
D. The cumulative EV was 100, and the
cumulative PV was 110.
Budget is COST, not
schedule.
So think either
COST Variance
Or
COST Performance
Index
Martin Bailey October 2012 65

66. Which of the following cumulative
measures indicates that your project is
about 9% under budget.
A. The cumulative AC was 100, and the
cumulative EV was 110.
B. The cumulative PV was 100, and the
cumulative AC was 110.
C. The cumulative AC was 110, and the
cumulative EV was 100.
D. The cumulative EV was 100, and the
cumulative PV was 110.
COST Variance
CV = EV - AC
COST Performance
Index
CPI = EV / AC
© Martin Bailey Sept 2012
Martin Bailey October 2012 66

67. Which of the following cumulative
measures indicates that your project is
about 9% under budget.
A. The cumulative AC was 100, and the
cumulative EV was 110.
B. The cumulative PV was 100, and the
cumulative AC was 110.
C. The cumulative AC was 110, and the
cumulative EV was 100.
D. The cumulative EV was 100, and the
cumulative PV was 110.
COST Variance
CV = EV - AC
COST Performance
Index
CPI = EV / AC
PV is NOT in either
formula, so 2 answers
are NOT correct
Martin Bailey October 2012 67

68. Which of the following cumulative
measures indicates that your project is
about 9% under budget.
A. The cumulative AC was 100, and the
cumulative EV was 110.
B. The cumulative PV was 100, and the
cumulative AC was 110.
C. The cumulative AC was 110, and the
cumulative EV was 100.
D. The cumulative EV was 100, and the
cumulative PV was 110.
COST Variance
CV = EV - AC
COST Performance Index
CPI = EV / AC
PV is NOT in either formula,
So 2 answers are NOT correct
Time to reach for the
calculator? Which
formula do I use?
Martin Bailey October 2012 68

69. Which of the following cumulative
measures indicates that your project is
about 9% under budget.
A. The cumulative AC was 100, and the
cumulative EV was 110.
B. The cumulative PV was 100, and the
cumulative AC was 110.
C. The cumulative AC was 110, and the
cumulative EV was 100.
D. The cumulative EV was 100, and the
cumulative PV was 110.
It is not that
difficult !
Use
Logic &
Understanding
to answer this in seconds
without a calculator.
Martin Bailey October 2012 69

70. Which of the following cumulative
measures indicates that your project is
about 9% under budget.
A. The cumulative AC was 100, and the
cumulative EV was 110.
B. The cumulative PV was 100, and the
cumulative AC was 110.
C. The cumulative AC was 110, and the
cumulative EV was 100.
D. The cumulative EV was 100, and the
cumulative PV was 110.
The key words are Under
Budget.
The means getting more
for your money than you
are spending.
You can rephrase that
to: Getting move
value than you are
paying for, or EV > AC.
Martin Bailey October 2012 70

71. Which of the following cumulative
measures indicates that your project is
about 9% under budget.
A. The cumulative AC was 100, and
the cumulative EV was 110.
B. The cumulative PV was 100, and the
cumulative AC was 110.
C. The cumulative AC was 110, and the
cumulative EV was 100.
D. The cumulative EV was 100, and the
cumulative PV was 110.
The key words are Under
Budget.
The means getting more
for your money than you
are spending.
You can rephrase that
to: Getting move
value than you are
paying for, or EV > AC.
The answer is A.
Martin Bailey October 2012 71

72. During the 6 month update on a 10 month
$300,000 project, the earned value
management analysis shows that the
cumulative PV is $190,000, the cumulative AC is
$120,000 and the cumulative EV is $150,000. In
planning its action the project management
team can conclude all of the following from
these measures EXCEPT:
A. Less has been accomplished than planned
B. Less has been spent than planned
C. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed behind schedule and under
budget.
D. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed ahead of schedule and over
budget.
Martin Bailey October 2012 72

73. During the 6 month update on a 10 month
$300,000 project, the earned value
management analysis shows that the
cumulative PV is $190,000, the cumulative AC is
$120,000 and the cumulative EV is $150,000. In
planning its action the project management
team can conclude all of the following from
these measures EXCEPT:
A. Less has been accomplished than planned
B. Less has been spent than planned
C. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed behind schedule and under
budget.
D. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed ahead of schedule and over
budget.
To quote a character from
Little Orphan Annie,
“Oh my goodness,
OH MY GOODNESS!”
There is a lot there!
Martin Bailey October 2012 73

74. During the 6 month update on a 10 month
$300,000 project, the earned value
management analysis shows that the
cumulative PV is $190,000, the cumulative AC is
$120,000 and the cumulative EV is $150,000. In
planning its action the project management
team can conclude all of the following from
these measures EXCEPT:
A. Less has been accomplished than planned
B. Less has been spent than planned
C. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed behind schedule and under
budget.
D. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed ahead of schedule and over
budget.
First the Important thing
Note the word EXCEPT!
Martin Bailey October 2012 74

75. During the 6 month update on a 10 month
$300,000 project, the earned value
management analysis shows that the
cumulative PV is $190,000, the cumulative AC is
$120,000 and the cumulative EV is $150,000. In
planning its action the project management
team can conclude all of the following from
these measures EXCEPT:
A. Less has been accomplished than planned
B. Less has been spent than planned
C. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed behind schedule and under
budget.
D. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed ahead of schedule and over
budget.
Now take out the "noise".
Martin Bailey October 2012 75

76. During the 6 month update on a 10 month
$300,000 project, the earned value
management analysis shows that the
cumulative PV is $190,000, the cumulative AC is
$120,000 and the cumulative EV is $150,000. In
planning its action the project management
team can conclude all of the following from
these measures EXCEPT:
A. Less has been accomplished than planned
B. Less has been spent than planned
C. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed behind schedule and under
budget.
D. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed ahead of schedule and over
budget.
A & B deal with
differences.
C& D look to be dealing
with Performance
(Indexes)
Get rid of the “noise”
Martin Bailey October 2012 76

77. During the 6 month update on a 10 month
$300,000 project, the earned value
management analysis shows that the
cumulative PV is $190,000, the cumulative AC is
$120,000 and the cumulative EV is $150,000. In
planning its action the project management
team can conclude all of the following from
these measures EXCEPT:
A. Less has been accomplished than planned
B. Less has been spent than planned
C. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed behind schedule and under
budget.
D. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed ahead of schedule and over
budget.
Now that the “noise” is
gone lets highlight the
question in green and go
over what we know.
EV = $150,000
AC = $120,000
EV = $150,000
PV = $190,000
Calculator Time ?
What
Formulas?
Martin Bailey October 2012 77

78. During the 6 month update on a 10 month
$300,000 project, the earned value
management analysis shows that the
cumulative PV is $190,000, the cumulative AC is
$120,000 and the cumulative EV is $150,000. In
planning its action the project management
team can conclude all of the following from
these measures EXCEPT:
A. Less has been accomplished than planned
B. Less has been spent than planned
C. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed behind schedule and under
budget.
D. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed ahead of schedule and over
budget.
It is not that
difficult !
Use
Logic &
Understanding
to answer this in seconds
without a calculator.
Martin Bailey October 2012 78

79. During the 6 month update on a 10 month
$300,000 project, the earned value
management analysis shows that the
cumulative PV is $190,000, the cumulative AC is
$120,000 and the cumulative EV is $150,000. In
planning its action the project management
team can conclude all of the following from
these measures EXCEPT:
A. Less has been accomplished than planned
B. Less has been spent than planned
C. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed behind schedule and under
budget.
D. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed ahead of schedule and over
budget.
EV = $150,000
AC = $120,000
We have earned more
value than the cost. We
are Under Budget.
EV = $150,000
PV = $190,000
We have received less
value than we planned to
this point. We are Behind
Schedule.
Martin Bailey October 2012 79

80. Time to Answer the
Question
During the 6 month update on a 10 month
$300,000 project, the earned value
management analysis shows that the
cumulative PV is $190,000, the cumulative AC is
$120,000 and the cumulative EV is $150,000. In
planning its action the project management
team can conclude all of the following from
these measures EXCEPT:
A. Less has been accomplished than planned
B. Less has been spent than planned
C. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed behind schedule and under
budget.
D. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed ahead of schedule and over
budget.
We are Under Budget.
We are Behind Schedule.
A is true
B is true
C is true
D is NOT true
Martin Bailey October 2012 80

81. Time to Answer the
Question
During the 6 month update on a 10 month
$300,000 project, the earned value
management analysis shows that the
cumulative PV is $190,000, the cumulative AC is
$120,000 and the cumulative EV is $150,000. In
planning its action the project management
team can conclude all of the following from
these measures EXCEPT:
A. Less has been accomplished than planned
B. Less has been spent than planned
C. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed behind schedule and under
budget.
D. Continuing performance at the same
efficiency with no management
intervention, the project will probably be
completed ahead of schedule and over
budget.
We are Under Budget.
We are Behind Schedule.
A is true
B is true
C is true
D is NOT true
Don’t forget the EXCEPT !
D is the correct answer!
Martin Bailey October 2012 81

82. If cumulative PV = 100, cumulative EV =
98 and cumulative AC = 104, the
project is likely to be:
A. Ahead of Schedule
B. Headed for a cost overrun
C. Operating at project cost projection
D. Under budget at completion
Martin Bailey October 2012 82

83. If cumulative PV = 100, cumulative EV =
98 and cumulative AC = 104, the
project is likely to be:
A. Ahead of Schedule
B. Headed for a cost overrun
C. Operating at project cost projection
D. Under budget at completion
EV = 98
AC = 104
EV = 98
PV = 100
Martin Bailey October 2012 83

84. If cumulative PV = 100, cumulative EV =
98 and cumulative AC = 104, the
project is likely to be:
A. Ahead of Schedule
B. Headed for a cost overrun
C. Operating at project cost projection
D. Under budget at completion
EV = 98
AC = 104
If EV < AC we are
over budget
EV = 98
PV = 100
If EV < PV we are
behind schedule
Martin Bailey October 2012 84

85. If cumulative PV = 100, cumulative EV =
98 and cumulative AC = 104, the
project is likely to be:
A. Ahead of Schedule
B. Headed for a cost overrun
C. Operating at project cost projection
D. Under budget at completion
EV = 98
AC = 104
If EV < AC we are
over budget
EV = 98
PV = 100
If EV < PV we are
behind schedule
Martin Bailey October 2012 85

86. If cumulative PV = 100, cumulative EV =
98 and cumulative AC = 104, the
project is likely to be:
A. Ahead of Schedule
B. Headed for a cost overrun
C. Operating at project cost projection
D. Under budget at completion
EV = 98
AC = 104
If EV < AC we are
over budget
EV = 98
PV = 100
If EV < PV we are
behind schedule
Martin Bailey October 2012 86

87. You monitored figures on cost and
planned/earned value for each individual
project week until the data date at the end
of the sixth week. What is the status of this
project at this date?
A. The project is ahead of schedule and over budget.
B. The project is ahead of schedule and under budget.
C. The project is behind schedule and over budget.
D. The project is behind schedule and under budget.
Project week Actual costs Earned value Planned value
1 $65,000 $61,000 $67,000
2 $85,000 $79,000 $89,000
3 $100,000 $102,000 $110,000
4 $125,000 $124,000 $121,000
5 $135,000 $133,000 $139,000
6 $125,000 $120,000 $131,000
Martin Bailey October 2012 87

88. You monitored figures on cost and
planned/earned value for each individual
project week until the data date at the end
of the sixth week. What is the status of this
project at this date?
A. The project is ahead of schedule and over budget.
B. The project is ahead of schedule and under budget.
C. The project is behind schedule and over budget.
D. The project is behind schedule and under budget.
This looks scary on the
surface.
Lots of formulas &
calculations.
Project week Actual costs Earned value Planned value
1 $65,000 $61,000 $67,000
2 $85,000 $79,000 $89,000
3 $100,000 $102,000 $110,000
4 $125,000 $124,000 $121,000
5 $135,000 $133,000 $139,000
6 $125,000 $120,000 $131,000
Martin Bailey October 2012 88

89. You monitored figures on cost and
planned/earned value for each individual
project week until the data date at the end
of the sixth week. What is the status of this
project at this date?
A. The project is ahead of schedule and over budget.
B. The project is ahead of schedule and under budget.
C. The project is behind schedule and over budget.
D. The project is behind schedule and under budget.
Actually it is easy.
First Steps.
Get Column Totals
For AC, EV, PV
Project week Actual costs
AC
Earned value
EV
Planned value
PV
1 $65,000 $61,000 $67,000
2 $85,000 $79,000 $89,000
3 $100,000 $102,000 $110,000
4 $125,000 $124,000 $121,000
5 $135,000 $133,000 $139,000
6 $125,000 $120,000 $131,000
Martin Bailey October 2012 89

90. You monitored figures on cost and
planned/earned value for each individual
project week until the data date at the end
of the sixth week. What is the status of this
project at this date?
A. The project is ahead of schedule and over budget.
B. The project is ahead of schedule and under budget.
C. The project is behind schedule and over budget.
D. The project is behind schedule and under budget.
AC = $635,000
EV = $619,000
PV = $657,000
Now to rearrange
them to make
comparison easier
Project week Actual costs
AC
Earned value
EV
Planned value
PV
1 $65,000 $61,000 $67,000
2 $85,000 $79,000 $89,000
3 $100,000 $102,000 $110,000
4 $125,000 $124,000 $121,000
5 $135,000 $133,000 $139,000
6 $125,000 $120,000 $131,000
Martin Bailey October 2012 90

91. You monitored figures on cost and
planned/earned value for each individual
project week until the data date at the end
of the sixth week. What is the status of this
project at this date?
A. The project is ahead of schedule and over budget.
B. The project is ahead of schedule and under budget.
C. The project is behind schedule and over budget.
D. The project is behind schedule and under budget.
EV = $619,000
AC = $635,000
EV = $619,000
PV = $657,000
Project week Actual costs
AC
Earned value
EV
Planned value
PV
1 $65,000 $61,000 $67,000
2 $85,000 $79,000 $89,000
3 $100,000 $102,000 $110,000
4 $125,000 $124,000 $121,000
5 $135,000 $133,000 $139,000
6 $125,000 $120,000 $131,000
Martin Bailey October 2012 91

92. You monitored figures on cost and
planned/earned value for each individual
project week until the data date at the end
of the sixth week. What is the status of this
project at this date?
A. The project is ahead of schedule and over budget.
B. The project is ahead of schedule and under budget.
C. The project is behind schedule and over budget.
D. The project is behind schedule and under budget.
EV = $619,000
AC = $635,000
Since EV < AC, you are
over budget
EV = $619,000
PV = $657,000
Project week Actual costs
AC
Earned value
EV
Planned value
PV
1 $65,000 $61,000 $67,000
2 $85,000 $79,000 $89,000
3 $100,000 $102,000 $110,000
4 $125,000 $124,000 $121,000
5 $135,000 $133,000 $139,000
6 $125,000 $120,000 $131,000
Martin Bailey October 2012 92

93. You monitored figures on cost and
planned/earned value for each individual
project week until the data date at the end
of the sixth week. What is the status of this
project at this date?
A. The project is ahead of schedule and over budget.
B. The project is ahead of schedule and under budget.
C. The project is behind schedule and over budget.
D. The project is behind schedule and under budget.
EV = $619,000
AC = $635,000
Since EV < AC, you are
over budget
EV = $619,000
PV = $657,000
Since EV < PV, you are
behind schedule
Project week Actual costs
AC
Earned value
EV
Planned value
PV
1 $65,000 $61,000 $67,000
2 $85,000 $79,000 $89,000
3 $100,000 $102,000 $110,000
4 $125,000 $124,000 $121,000
5 $135,000 $133,000 $139,000
6 $125,000 $120,000 $131,000
Martin Bailey October 2012 93

94. A project manager reported the
following earned value data: PV:
$12,400,000 EV: $14,500,000 AC:
$14,500,000 What does this mean?
A. The project is over budget and
on schedule.
B. The project is under budget and
on schedule
C. The project is on budget, but
behind schedule.
D. The project is on budget and
ahead of schedule.
Martin Bailey October 2012 94

95. A project manager reported the
following earned value data: PV:
$12,400,000 EV: $14,500,000 AC:
$14,500,000 What does this mean?
A. The project is over budget and
on schedule.
B. The project is under budget and
on schedule
C. The project is on budget, but
behind schedule.
D. The project is on budget and
ahead of schedule.
First:
Get rid of the noise
Martin Bailey October 2012 95

96. A project manager reported the
following earned value data: PV:
$12,400,000 EV: $14,500,000 AC:
$14,500,000 What does this mean?
A. The project is over budget and
on schedule.
B. The project is under budget and
on schedule
C. The project is on budget, but
behind schedule.
D. The project is on budget and
ahead of schedule.
EV = $14,500,000
AC = $14,500,000
EV = $14,500,000
PV = $12,400,000
Martin Bailey October 2012 96

97. A project manager reported the
following earned value data: PV:
$12,400,000 EV: $14,500,000 AC:
$14,500,000 What does this mean?
A. The project is over budget and
on schedule.
B. The project is under budget and
on schedule
C. The project is on budget, but
behind schedule.
D. The project is on budget and
ahead of schedule.
EV = $14,500,000
AC = $14,500,000
EV = AC (On budget)
EV = $14,500,000
PV = $12,400,000
Martin Bailey October 2012 97

98. A project manager reported the
following earned value data: PV:
$12,400,000 EV: $14,500,000 AC:
$14,500,000 What does this mean?
A. The project is over budget and
on schedule.
B. The project is under budget and
on schedule
C. The project is on budget, but
behind schedule.
D. The project is on budget and
ahead of schedule.
EV = $14,500,000
AC = $14,500,000
EV = AC (On budget)
EV = $14,500,000
PV = $12,400,000
EV > PV (ahead of
schedule)
Martin Bailey October 2012 98

99. Question 14 You are a Project Manager of a
home remodeling project. The
Budget At Completion (BAC) for this
project is $68,000 US. By looking at
your schedule, you should be 65%
complete, but you are only 50%
done. What is your Earned Value?
A. $30,800 US
B. $44,200 US
C. $34,000 US
D. $22,000 US
Martin Bailey October 2012 99

100. You are a Project Manager of a
home remodeling project. The
Budget At Completion (BAC) for this
project is $68,000 US. By looking at
your schedule, you should be 65%
complete, but you are only 50%
done. What is your Earned Value?
A. $30,800 US
B. $44,200 US
C. $34,000 US
D. $22,000 US
Lots of words.
What is the real
question?
Martin Bailey October 2012 100

101. You are a Project Manager of a
home remodeling project. The
Budget At Completion (BAC) for this
project is $68,000 US. By looking at
your schedule, you should be 65%
complete, but you are only 50%
done. What is your Earned Value?
A. $30,800 US
B. $44,200 US
C. $34,000 US
D. $22,000 US
EV =
BAC * %complete
Martin Bailey October 2012 101

102. You are a Project Manager of a
home remodeling project. The
Budget At Completion (BAC) for this
project is $68,000 US. By looking at
your schedule, you should be 65%
complete, but you are only 50%
done. What is your Earned Value?
$30,800 US
$44,200 US
$34,000 US
$22,000 US
Get rid of the
noise
Martin Bailey October 2012 102

103. You are a Project Manager of a
home remodeling project. The
Budget At Completion (BAC) for this
project is $68,000 US. By looking at
your schedule, you should be 65%
complete, but you are only 50%
done. What is your Earned Value?
A. $30,800 US
B. $44,200 US
C. $34,000 US
D. $22,000 US
$68,000 * %50 =
$34,000
Martin Bailey October 2012 103

104. There are 17 people on a
project. How many lines of
communication are there?
A. 136
B. 105
C. 112
D. 68
Martin Bailey October 2012 104

105. Communication Lines There are 17 people on a
project. How many lines of
communication are there?
A. 136
B. 105
C. 112
D. 68
Answer = N * (N-1) / 2
© Martin Bailey Sept 2012
Martin Bailey October 2012 105

106. Communication Lines There are 17 people on a
project. How many lines of
communication are there?
A. 136
B. 105
C. 112
D. 68
Answer = N * (N-1) / 2
Answer = 17 * 16 / 2
Answer = 136
Martin Bailey October 2012 106

107. Communication Lines There are 17 people on a
project. How many lines of
communication are there?
A. 136
B. 105
C. 112
D. 68
A different Approach
Using N or N-1
(because I don’t like
multplying BIG numbers)
Either N or N-1 ends up being
EVEN.. So divide the even number
by 2 and multiply by the other.
In this Case N = 17
N-1 = 16 16/2 = 8
8 * 17 = 136
Martin Bailey October 2012 107

108. You are a project manager on a large
military contract that involves 7
subcontractor companies and a total
of 1,253 team members, 752
stakeholders and sponsors, and 14
project managers (including you). You
need to get a handle on the
communications channels, because
otherwise your project will devolve
into chaos. How many potential
channels of communication are there
on this project?
A. 2019
B. 91
C. 2,037,171
D. No way to determine
Martin Bailey October 2012 108

109. Communication Channels
You are a project manager on a large
military contract that involves 7
subcontractor companies and a total
of 1,253 team members, 752
stakeholders and sponsors, and 14
project managers (including you). You
need to get a handle on the
communications channels, because
otherwise your project will devolve
into chaos. How many potential
channels of communication are there
on this project?
A. 2019
B. 91
C. 2,037,171
D. No way to determine
First we need to get rid of the
“curveball” that was thrown
in here.
The Subcontractors are
Stakeholders!
So don’t include the
Companies as additional
Stakeholders!
Martin Bailey October 2012 109

110. Communication Channels
You are a project manager on a large
military contract that involves 7
subcontractor companies and a total
of 1,253 team members, 752
stakeholders and sponsors, and 14
project managers (including you). You
need to get a handle on the
communications channels, because
otherwise your project will devolve
into chaos. How many potential
channels of communication are there
on this project?
A. 2019
B. 91
C. 2,037,171
D. No way to determine
I guess we need a calculator
to figure out N
1,253
752
+ 14
2019
N = 2019
Martin Bailey October 2012 110

111. Communication Channels
You are a project manager on a large
military contract that involves 7
subcontractor companies and a total
of 1,253 team members, 752
stakeholders and sponsors, and 14
project managers (including you). You
need to get a handle on the
communications channels, because
otherwise your project will devolve
into chaos. How many potential
channels of communication are there
on this project?
A. 2019
B. 91
C. 2,037,171
D. No way to determine
I guess we need a calculator
to figure out N
1,253
752
+ 14
2019
N = 2019
Martin Bailey October 2012 111

112. You are a project manager on a large
military contract that involves 7
subcontractor companies and a total
of 1,253 team members, 752
stakeholders and sponsors, and 14
project managers (including you). You
need to get a handle on the
communications channels, because
otherwise your project will devolve
into chaos. How many potential
channels of communication are there
on this project?
A. 2019
B. 91
C. 2,037,171
D. No way to determine
Prove it by
doing the Math
The formula is N * (N-1) /2
N = 2019
N-1 = 2018
Now divide the even
number by 2
2018/2 = 1009
2,019 * 1,009 =
2,037,171
Martin Bailey October 2012 112

113. You are a project manager on a large
military contract that involves 7
subcontractor companies and a total
of 1,253 team members, 752
stakeholders and sponsors, and 14
project managers (including you). You
need to get a handle on the
communications channels, because
otherwise your project will devolve
into chaos. How many potential
channels of communication are there
on this project?
A. 2019
B. 91
C. 2,037,171
D. No way to determine
Lets put the calculator down.
The rest is logic !
N = 2019
The formula is
N * (N-1) /2
Martin Bailey October 2012 113

114. You are a project manager on a large
military contract that involves 7
subcontractor companies and a total
of 1,253 team members, 752
stakeholders and sponsors, and 14
project managers (including you). You
need to get a handle on the
communications channels, because
otherwise your project will devolve
into chaos. How many potential
channels of communication are there
on this project?
A. 2019
B. 91
C. 2,037,171
D. No way to determine
N = 2019
The formula is
N * (N-1) /2
Therefore we know
the answer is larger
than 2019 !
This eliminates A & B
Martin Bailey October 2012 114

115. You are a project manager on a large
military contract that involves 7
subcontractor companies and a total
of 1,253 team members, 752
stakeholders and sponsors, and 14
project managers (including you). You
need to get a handle on the
communications channels, because
otherwise your project will devolve
into chaos. How many potential
channels of communication are there
on this project?
A. 2019
B. 91
C. 2,037,171
D. No way to determine
N = 2019
The formula is
N * (N-1) /2
Since we know N
We can compute
N-1
Which means we CAN
determine an answer!
C is Correct !
Martin Bailey October 2012 115

116. You are the project manager for a
project where there are 7 team-
members. One more team member
will be joining after 1 week. What is
the number of communication
channels once the new person joins
your team?
A. 28
B. 21
C. 18
D. 36
Martin Bailey October 2012 116

117. You are the project manager for a
project where there are 7 team-
members. One more team member
will be joining after 1 week. What is
the number of communication
channels once the new person joins
your team?
A. 28
B. 21
C. 18
D. 36
7 team members
1 new team member
You (don’t forget yourself)
9 Total contacts
Martin Bailey October 2012 117

118. You are the project manager for a
project where there are 7 team-
members. One more team member
will be joining after 1 week. What is
the number of communication
channels once the new person joins
your team?
A. 28
B. 21
C. 18
D. 36
9 Total contacts
N * (N-1) / 2
N = 9
N-1 = 8
8/2 = 4
9 * 4 = 36
Martin Bailey October 2012 118

119. Back to the first question
Bob, a project manager for 25th Century Construction, is working
on his 535th project and is retiring after his 35th year. Using the
new distinctive sky blue Ford F-850 3 ton dump-truck his team
has delivered 4 miles of road consisting of 7/8 grade gravel in 4
months. Jenny, his associate, had planned for 5 miles of road in
this time period.
Is this project:
A. On time
B. Ahead of Schedule
C. Behind Schedule
D. Not enough information to determine

120. Bob, a project manager for 25th Century Construction, is working
on his 535th project and is retiring after his 35th year. Using the
new distinctive sky blue Ford F-850 3 ton dump-truck his team
has delivered 4 miles of road consisting of 7/8 grade gravel in 4
months. Jenny, his associate, had planned for 5 miles of road in
this time period.
Is this project:
A. On time
B. Ahead of Schedule
C. Behind Schedule
D. Not enough information to determine

121. Bob, a project manager for 25th Century Construction, is working
on his 535th project and is retiring after his 35th year. Using the
new distinctive sky blue Ford F-850 3 ton dump-truck his team
has delivered 4 miles of road consisting of 7/8 grade gravel in 4
months. Jenny, his associate, had planned for 5 miles of road in
this time period.
Is this project:
A. On time
B. Ahead of Schedule
C. Behind Schedule
D. Not enough information to determine

122. Bob, a project manager for 25th Century Construction, is working
on his 535th project and is retiring after his 35th year. Using the
new distinctive sky blue Ford F-850 3 ton dump-truck his team
has delivered 4 miles of road consisting of 7/8 grade gravel in 4
months. Jenny, his associate, had planned for 5 miles of road in
this time period.
Is this project:
A. On time
B. Ahead of Schedule
C. Behind Schedule
D. Not enough information to determine

123. Bob, a project manager for 25th Century Construction, is working
on his 535th project and is retiring after his 35th year. Using the
new distinctive sky blue Ford F-850 3 ton dump-truck his team
has delivered 4 miles of road consisting of 7/8 grade gravel in 4
months. Jenny, his associate, had planned for 5 miles of road in
this time period.
Is this project:
A. On time
B. Ahead of Schedule
C. Behind Schedule
D. Not enough information to determine

124. Bob, a project manager for 25th Century Construction, is working
on his 535th project and is retiring after his 35th year. Using the
new distinctive sky blue Ford F-850 3 ton dump-truck his team
has delivered 4 miles of road consisting of 7/8 grade gravel in 4
months. Jenny, his associate, had planned for 5 miles of road in
this time period.
Is this project:
A. On time
B. Ahead of Schedule
C. Behind Schedule
D. Not enough information to determine

125. Bob, a project manager for 25th Century Construction, is working
on his 535th project and is retiring after his 35th year. Using the
new distinctive sky blue Ford F-850 3 ton dump-truck his team
has delivered 4 miles of road consisting of 7/8 grade gravel in 4
months. Jenny, his associate, had planned for 5 miles of road in
this time period.
Is this project:
A. On time
B. Ahead of Schedule
C. Behind Schedule
D. Not enough information to determine

126. Bob, a project manager for 25th Century Construction, is working
on his 535th project and is retiring after his 35th year. Using the
new distinctive sky blue Ford F-850 3 ton dump-truck his team
has delivered 4 miles of road consisting of 7/8 grade gravel in 4
months. Jenny, his associate, had planned for 5 miles of road in
this time period.
Is this project:
A. On time
B. Ahead of Schedule
C. Behind Schedule
D. Not enough information to determine

127. The real question is
Delivered 4 miles of road in 4 months.
Planned for 5 miles of road in this time period.
Is this project:
A. On time
B. Ahead of Schedule
C. Behind Schedule
D. Not enough information to determine

128. Summary
Budget or Cost
EV = Earned Value
AC = Actual Cost
If EV = AC
– On budget
If EV > AC
– Under Budget
– Positive Cost Variance
If EV < AC
– Over Budget
– Negative Cost Variance
NOTE: Within Budget can mean
On Budget or Under Budget
Schedule
EV = Earned Value
PV = Planned Value
If EV = PV
– On schedule
If EV > PV
– Ahead of Schedule
– Positive Schedule Variance
If EV < PV
– Behind Schedule
– Negative Schedule Variance
NOTE: Within Schedule can mean
On Schedule or Ahead of Schedule
Martin Bailey October 2012 128

129. Summary (Continued)
• The goal of this presentation is to show you logic (or
tricks) that will save you time on the exam.
• If you answer a question this way but feel it was too
easy.
– Answer the question using the short cut
– Mark the question for review
– Answer the question again
• If you use a formula on the 2nd or 3rd time thru – be sure to use the
correct one
• Use the scratch paper
• Don’t forget to do the “Brain Dump” before starting.
Martin Bailey October 2012 / March 2016 129

130. Questions or Comments?
Martin Bailey October 2012 130
Martin R. Bailey
Mentor, Leader, and Advisor
in Project & Program Management
as well as Agile.
MartinRBailey@gmail.com
479-270-2485
MPM, PMP, CSM, ITIL
www.linkedin.com/in/martinrbailey