PMP Formula for PMP Exam
This page covers PMP formulas very useful to crack the PMP Exam and obtain the PMP certification. It covers activity duration,CV,SV,NPV,FV,PV,CPI,SPI,ETC,EAC,VAC,TCPI,activity float,sigma etc.
Payback period
For example, If the investment in some business startup is about 2 Lakh and cash inflow per quarter is about 25K, Then payback period is 2 years as per payback period formula mentioned.
NPV,BCR, IRR
NPV-Net Present Value
BCR-Benefit to Cost Ratio
IRR- Internal Rate of Return
PV-Present Value
FV-Future Value
PV=FV/(1+i)n
If there will be two project scenarios mentioned with two different values of NPV (or BCR or IRR), then choose the project with the higher NPV (or BCR or IRR).
Estimate activity duration formulas (Project Time Management)
Activity duration = (P+4M+O)/6
Standard Deviation = (P-O)/6
Variance = (P-O/6)2
Cost and Schedule related formulas
PV- Planned Value, also referred as Budgeted cost of work scheduled (BCWS)
EV- Earned Value, also referred as Budgeted cost of work performed (BCWP)
AC- Actual Cost, also referred as Actual cost of work performed (ACWP)
Schedule Variance (SV) = EV-PV
Cost Variance (CV) = EV-AC
Schedule Performance Index (SPI) = EV/PV
Cost Performance Index (CPI) = EV/AC
SV% = SV/PV x 100
CV%= CV/EV x 100
ETC (Estimate to Complete) the balance work = BAC-EV
ETC = BAC-EV /CPI , here BAC is Budget at Completion
Estimate at completion (EAC) of the total work
EAC = AC + BAC-EV
EAC= (AC+BAC-EV)/CPI
Estimated Variance at completion on completing total work
VAC= BAC-EAC
VAC%= (VAC/BAC) x 100
TCPI (To complete Performance Index) for completing balance work
TCPI= (BAC-EV)/(BAC-AC)x 100
= (BAC-EV)/(EAC-AC) x 100
Time estimation - Precedence diagram method for schedule estimation
ES-Early Start , EF-Early Finish, LS- Late Start, LF- Late Finish, D-Duration
EF = ES +D -1
LS= LF-D+1
Activity Duration= EF-ES or LF-LS
Activity Float= LS-ES or LF-EF
Estimated project completion date= project completion date/SPI
Communication management
Lines of communication = N x (N-1) / 2
Where is N is number of people
Quality formulas
1 sigma = 68.26%
2 sigma = 95.46%
3 sigma = 99.73%
6 sigma = 99.99985%
Risk Management
EMV (Expected Monetary Value)
Useful PMP Related Links
Project management professional,PMP, READ MORE.
How to pass PMP Exam on first attempt, READ MORE.
PMP Training Institutes, READ MORE.
Agile scrum methodology and scrum basics,READ MORE.
Website for PMP Management professionals
The managementtutor site contains resources very useful for management enthusiasts. It covers various branches of management which include project management, marketing, accounting management, organizational behavior, quantitative analysis, finance and accounting, operations management, economics, strategy etc. It also provides guide for various management exams including resources which helps pass the exam such as PMP. The manegementtutor covers calculators section which covers easy to use calculators for performing various calculations. Website: https://www.managementtutor.com