CAPM (Certified Associate in Project Management) Practice Exam

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Study for the Certified Associate in Project Management Exam with practice questions and answers. Enhance your understanding of project management principles and strategies to excel in the exam!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

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What is the formula for calculating cost variance?

CV = EV - AC
CV = AC - EV
CV = EV/AC
CV = AC/EV

The correct answer is: CV = EV - AC

The formula for calculating cost variance (CV) is A CV = EV - AC, where EV is Earned Value and AC is Actual Cost. This formula takes into account the difference between the amount of work that was planned (EV) and the actual cost incurred (AC). Choice B is incorrect because it reverses the order of EV and AC, which would result in a negative cost variance. Choice C is incorrect because it divides EV by AC, which does not accurately represent the difference between the planned and actual costs. Choice D is incorrect because it divides AC by EV, which would also result in a negative cost variance. Overall, choice A is the correct formula for calculating cost variance because it accurately reflects the difference between the planned and actual costs.