Project Management Professional (PMP) Exam Practice – Question1825 | Project Management Professional PMP Mock Exam Practice

A cost management plan should establish and document the various earned value rules of performance measurement. Along with defining the WBS to the level that the earned value analysis will be performed and establishing how earned value will be credited to
the project (0-100, 0-50-100, and so on), which following rule is also recognized regarding performance measurement?

A. Determine the formula for calculating the estimate to complete (ETC) for the project
B. Determine the code of accounts allocation provision for the WBS
C. Determine the formula for calculating the estimate at completion (EAC) for the project
D. Determine the variance thresholds to be used in the project

Correct Answer: C

Explanation:

Explanation:
Three recognized earned value rules of performance measurement are to (1) determine the EAC calculation to be used on the project as tracking methodologies are specified and to provide a validity check on the bottom-up EAC, (2) establish the earned value
measurement techniques (for example, weighted milestones, fixed formula or percent complete), and (3) define the WBS level at which the measurements of control accounts will be performed. Four methods can be used to calculate the EAC.