PMP Exam: Part – 4

Here are the formula’s to remember:

Slack/Float = Critical Path – Sum (Duration of that Path)
ES = Sum of Predecessors +1
EF = ES +Duration -1
LS = ES + FLOAT (Remember FLOAT = LS- ES which is a transpose of LESS)
LF = LS+Duration-1

Dummy activity has zero duration
PV = %Complete x BAC (This is for schedule)
EV = %Complete x BAC (This relates to work)

PTA = Target Cost +( CP – TP) / % of share of cost overrun

How much will it cost = EAC= BAC/CPI
How much MORE will it cost = ETC =BAC/CPI

Given CPI, EV, BAC, PV how will you calculate the EAC or ETC or SPI ?


Target cost/price/profit all relate to fixed price incentive.
Target cost – Actual cost = savings —- Remember it could be loses too!

Now this savings plays the major role in this contract. The incentive is based on these savings. Hence more the savings , more the seller gets!
So if there are savings, then seller would get the cost plus his fee plus %of savings.
Target price 20,000 Target profit 2,000
Target price 21,000 Ceiling price 22,000

Share ratio 80/20.

If actual cost = 18k then Amount to be paid to the seller by the buyer equals ?

What if actual cost = 20k

What if actual cost = 23k

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