INFO6007 Chap.5 Cost Management and Earned Value Analysis
Cost Management and Earned Value Analysis
Earned Value Management integrates planned value, earned value and actual cost at one status date, then derives variances, efficiency indexes and completion forecasts. This chapter develops Cost types, Cost management plan, Estimate costs, Cost baseline, PV, EV and AC, CV and SV, CPI and SPI, EAC, ETC and VAC, Traditional and Agile budgeting, Cost control.
Each idea is framed as a management decision: what evidence is needed, who owns the decision, which baseline or service outcome changes, and how the result is communicated.
Write PV, EV and AC first; calculate each measure with substituted values; interpret variance signs and index thresholds; preserve precision used by later forecasts. The method is deliberately connective.
Scope choices affect dependencies and estimates; resource choices affect schedule and cost; governance choices affect escalation and benefit ownership; service choices affect operating value. A strong answer names those links rather than reproducing an isolated framework.
CV and SV below zero are adverse, CPI and SPI below one are adverse, and the supplied tutorial reports 0.73 while using 0.727 in its stated EAC.
The chapter uses direction checks, boundary cases and original scenarios to make those errors visible. Where a supplied figure is reproduced third-party material, the guide rebuilds it on new dimensions.
Where an answer is independently computed from a published table, it is labelled AskSia-authored rather than attributed to the University.
For assessment, start with a one-sentence definition, apply it to the stated facts, explain the consequence for objectives or constraints, and finish with the controlled action. Quantitative work must show the formula, substituted values, result, direction and management meaning.
Qualitative work must identify the decision owner and the evidence that would change the recommendation.
Study this chapter through retrieval. Rebuild the central artefact from a blank page, test it against a changed assumption, then check it against one neighbouring plan or practice.
That routine prepares for explanations, comparisons, scenarios and calculations without inventing a past-paper format or per-question mark scheme.
What this chapter covers
- 01
Cost types
- 02
Cost management plan
- 03
Estimate costs
- 04
Cost baseline
- 05
PV, EV and AC
- 06
CV and SV
- 07
CPI and SPI
- 08
EAC, ETC and VAC
- 09
Traditional and Agile budgeting
- 10
Cost control
Free worked application: Cost Management and Earned Value Analysis
- FrameIdentify the objective, decision owner and evidence available at the decision point.
- MethodApply the chapter rule and keep assumptions, units and direction words explicit.
- IntegrateTrace effects into at least one connected plan, baseline, stakeholder or service outcome.
- ActState the recommendation and the change, control or communication action that follows.
- VerifyCheck the result against the chapter trap and explain why the conclusion is reproducible.
Key terms
- Cost types
- A chapter concept used to make the relevant scope, flow, responsibility, measure or outcome explicit. Interpret it in the scenario rather than from its label alone.
- Cost management plan
- A chapter concept used to connect evidence to a controlled project or service decision. Interpret it in the scenario rather than from its label alone.
- Estimate costs
- A chapter concept used to make the relevant scope, flow, responsibility, measure or outcome explicit. Interpret it in the scenario rather than from its label alone.
- Cost baseline
- A chapter concept used to connect evidence to a controlled project or service decision. Interpret it in the scenario rather than from its label alone.
- PV, EV and AC
- A chapter concept used to make the relevant scope, flow, responsibility, measure or outcome explicit. Interpret it in the scenario rather than from its label alone.
- CV and SV
- A chapter concept used to connect evidence to a controlled project or service decision. Interpret it in the scenario rather than from its label alone.
Cost Management and Earned Value Analysis FAQ
How should I interpret CPI and SPI?
CPI compares earned value with actual cost; SPI compares earned value with planned value. Above one is favourable and below one is adverse for the measure concerned.
What is the main decision rule for Cost Management and Earned Value Analysis?
Write PV, EV and AC first; calculate each measure with substituted values; interpret variance signs and index thresholds; preserve precision used by later forecasts.
What is the most common trap in Cost Management and Earned Value Analysis?
CV and SV below zero are adverse, CPI and SPI below one are adverse, and the supplied tutorial reports 0.73 while using 0.727 in its stated EAC.
How should I structure a written answer on Cost Management and Earned Value Analysis?
Define the concept, apply it to specific facts, explain the effect on an objective or constraint, identify the decision owner, and state the next controlled action.
Are the worked scenarios for Cost Management and Earned Value Analysis official answers?
No. They are AskSia-authored learning examples derived independently from the concepts and stated inputs. They are not official questions, marking schemes or university solutions.
Exam move
Begin with the chapter map: Cost types, Cost management plan, Estimate costs, Cost baseline, PV, EV and AC, CV and SV, CPI and SPI, EAC, ETC and VAC, Traditional and Agile budgeting, Cost control. Write the purpose of each item in your own words and connect it to a decision, an artefact and an owner. Then rebuild the worked application without looking at the answer.
Use this governing rule: Write PV, EV and AC first; calculate each measure with substituted values; interpret variance signs and index thresholds; preserve precision used by later forecasts. Create two variations by changing one assumption, dependency, rating, probability, duration or stakeholder priority. Explain what changes and what remains stable.
Keep an error ledger headed direction, boundary, authority, precision and integration. The chapter's highest-risk mistake is: CV and SV below zero are adverse, CPI and SPI below one are adverse, and the supplied tutorial reports 0.73 while using 0.727 in its stated EAC.
For quantitative work, write symbols and units before arithmetic, keep intermediate precision visible and translate the result into under/over, ahead/behind, faster/cheaper or selected/not selected as appropriate. For qualitative work, write claim, scenario evidence, causal reasoning and controlled action. Finish by checking one neighbouring plan or practice.
Review operational assessment details on Canvas; this learning chapter does not invent dates, a viva rubric, past-paper questions or a per-question university mark scheme.
Working through Cost Management and Earned Value Analysis in INFO6007? Sia is AskSia’s AI Project Management tutor — ask any INFO6007 Cost Management and Earned Value Analysis question and get a clear, step-by-step explanation grounded in how INFO6007 is taught and assessed. Read this chapter free, then take your hardest questions to Sia.
