Business Degree Certification Practice Test

What is the standard procedure for measuring a project's progress and forecasting its completion date?

1. Program evaluation and review technique (PERT)

2. The critical path method (CPM)

3. A Gantt chart

4. Earned value analysis (EVA)

The correct answer is: Earned value analysis (EVA)

The standard procedure for measuring a project's progress and forecasting its completion date involves Earned Value Analysis (EVA). This method integrates project scope, schedule, and cost variables, allowing project managers to assess performance effectively. EVA compares the planned progress with the actual work completed and the budgeted expenditures. By calculating key metrics such as Planned Value (PV), Earned Value (EV), and Actual Cost (AC), project managers can determine variances that indicate whether the project is on track, ahead, or behind schedule in terms of both costs and timelines. Using EVA provides a quantitative approach for forecasting future project performance based on current trends, enabling managers to make informed decisions about resource allocation and necessary corrective actions. This method is widely used in project management due to its ability to provide insights into both current status and potential future performance, making it a powerful tool for ensuring projects meet their deadlines and financial targets.