The Cost Performance Index (CPI)

question 83

Multiple Choice

The cost performance index (CPI) :

• A)indicates that a project is under budget if CPI is less than one. 
• B)can be used to estimate the projected cost of completing the project. 
• C)indicates that the planned and actual costs are equal if CPI is more than one. 
• D)is the ratio of earned value to planned value.

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Definitions:

Prices Charged

The amount of money demanded by a business in exchange for its goods or services.

Long Run

A period during which all factors of production and costs are variable, allowing firms to adjust to desired levels.

Gas Station

A retail establishment that sells fuel and often other goods or services to motor vehicle customers.

Long-Run Equilibrium

A state in which all firms in an industry are making normal profit and there is no incentive for market entry or exit.