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Cost Performance Index(CPI)
Project Management
CPI measures cost efficiency by comparing earned value with actual cost.
Definition
CPI measures cost efficiency by comparing earned value with actual cost.
Formula
CPI = EV / AC
Explanation of Variables
EV = Earned Value
AC = Actual Cost
AC = Actual Cost
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Result: —
Worked Example
EV = 100,000
AC = 120,000
CPI = 100,000 / 120,000 = 0.83
AC = 120,000
CPI = 100,000 / 120,000 = 0.83
Industry Use Case
Used in project control to determine whether the project is under or over budget.
Related Formulas
Schedule Performance Index (SPI)
Project Management
SPI measures schedule efficiency by comparing earned value to planned value.