# 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