© Sean Whitaker 2016
Sean WhitakerPMP® Examination Practice Questions10.1007/978-1-4842-1883-9_3

3. Formulae to Remember

Sean Whitaker
(1)
ChristChurch, Canterbury, New Zealand
 
Communications (how many people in a communications network)
N = (n (n - 1)) / 2
Present value (PV)
PV = (FV / (1 + r)n)
where
  • FV = Future value in $
  • r = Discount rate percentage expressed as a decimal number (i.e. 10% = 0.1)
  • n = The time period (i.e. 5 years)
Net present value (NPV)
  • NPV = Initial outlay + the sum of all subsequent present value calculations
Earned value management
  • Planned value (PV) = Time % complete x BAC
  • Earned value (EV) = PV x % complete
  • Schedule variance (SV) = EV - PV
  • Schedule performance index (SPI) = EV / PV
  • Cost variance (CV) = EV - AC
  • Cost performance index (CPI) = EV / AC
Estimate at completion (EAC) - 1 of 4 formulae
  • EAC = BAC / CPI
  • EAC = AC + ETC
  • EAC = AC  +  (BAC - EV)
  • EAC = AC  +  ((BAC - EV) / (CPI x SPI))
Estimate to complete (ETC) = EAC - AC
Variance at completion (VAC) = BAC - EAC
To Complete Performance Index (TCPI)
  • TCPI = (BAC - EV) / (BAC - AC) if you are aiming for BAC
  • TCPI = (BAC - EV) / (EAC - AC) if you are aiming for EAC
Three-point estimating from PERT (Program Evaluation and Review Technique )
Three-point estimate = (O  +  (M x 4) + P) / 6
where
  • O = Optimistic
  • M = Most likely (sometimes appears as an R for Realistic)
  • P = Pessimistic
  • Standard deviation = (P - O) / 6
  • Variance = ((P - O) / 6)2
Point of total assumption (PTA)
PTA = Target cost + ((ceiling price - target price) / buyers % share of cost overruns))
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