In earned value analysis, what does the cost performance index primarily indicate?
Correct answer: B. The ratio of earned value to actual cost
- A. The ratio of planned value to contract duration
- B. The ratio of earned value to actual cost
- C. The difference between tender and final account
- D. The percentage of work delayed by weather
Explanation
The cost performance index is calculated as earned value divided by actual cost. A value above one indicates that the work accomplished has cost less than the budgeted value of that work, while a value below one indicates cost inefficiency.
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About Construction Management and Estimation
Construction management covers planning, scheduling, resource control, contracts, procurement, site organisation, safety, quality assurance and project documentation. Estimation includes quantity take-off, rate analysis, bill preparation, valuation and cost control, with attention to the difference between direct and indirect costs and between an estimate, a tender and a final account.
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