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PROJECT
MANAGEMENT
PROFESSIONAL (PMP)
Related Formulas

Project Management - Subject Matter Experts

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Formulas Snapshot Risk P – Probability

I – Impact
 Expected Monetary Value(EMV) = 𝑃 ∗ 𝐼
Project Selection PV – Present Value
𝐹𝑉 FV- Future Value
 PV = r – Interest rate Earned Value Management (EVM)
(1+𝑟)𝑛 n – time period 𝑃𝑉
 FV = PV * (1 + 𝑟)𝑛 NPV – Net Present Value  EV =
𝐴𝐶
ROI – Rate of Interest CV – Cost Variance
 NPV = Pick the biggest number. IRR – Internal Rate of  CV = EV – AC
SV – Schedule Variance
 ROI = Pick the biggest number. Return  SV = EV – PV AC – Actual Cost
BCR – Benefit Cost Ratio 𝐸𝑉 PV – Present Value
 IRR = Pick the biggest number.  CPI =
CBR – Cost Benefit Ratio 𝐴𝐶 CPI – Cost Performance Index
𝐸𝑉 SPI – Schedule Performance Index
 SPI = EAC – Estimate at Completion
 Payback Period = 𝑃𝑟𝑜𝑗𝑒𝑐𝑡𝑒𝑑 𝐶𝑎𝑠𝑕 𝐼𝑛𝑓𝑙𝑜𝑤 − 𝑖=0 𝐸𝑥𝑝𝑒𝑛𝑠𝑒𝑠 𝑃𝑉
BAC – Budget at Completion
𝐵𝐴𝐶 TCPI – To Complete Performance Index
𝐸𝑉
𝐵𝑒𝑛𝑒𝑓𝑖𝑡  TCPI = 𝐵𝐴𝐶
 𝐵𝐶𝑅 =
𝐶𝑜𝑠𝑡 𝐴𝐶
𝐵𝐴𝐶
 EAC (no variances) =
𝐶𝑜𝑠𝑡 𝐶𝑃𝐼
 C𝐵𝑅 =
𝐵𝑒𝑛𝑒𝑓𝑖𝑡  EAC (with variances) = AC + ETC
 EAC (typical) = AC + ( BAC – EV )
 Opportunity Cost = Value of project not being chosen 𝐵𝐴𝐶 −𝐸𝑉
 EAC (atypical) = AC +
𝐶𝑃𝐼

ETC – Estimate to Complete

Communications  ETC = EAC – AC EV – Earned Value
𝑛 ∗ (𝑛−1) VAC – Variance at Completion
 Communication Channels =  VAC = BAC – EAC
2
 Number of conversations each person can have at any given
point in time = n -1 𝐸𝑉 𝐶
 𝐶𝑃𝐼 𝐶 =
𝐴𝐶 𝐶
Procurement 𝐹𝑉
C – Cumulative
 Point of Total Assumption(PTA) =  PV =
(1+𝑟)𝑛
𝐶𝑒𝑖𝑙𝑖𝑛𝑔 𝑃𝑟𝑖𝑐𝑒 −𝑇𝑎𝑟𝑔𝑒𝑡 𝑃𝑟𝑖𝑐𝑒 𝐸𝑉
+ 𝑇𝑎𝑟𝑔𝑒𝑡 𝐶𝑜𝑠𝑡  Percent Complete = * 100
𝐵𝑢𝑦𝑒𝑟𝑠 𝑆𝑕𝑎𝑟𝑒 𝑅𝑎𝑡𝑖𝑜 𝐵𝐴𝐶
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Formulas Snapshot
Hard Values Arithmetic Calculations Network Diagram
 Activity Duration = EF – ES +1
 1 sigma = 68.26%  Average(Mean) = OR
 2 sigma = 95.46%  Activity Duration = LF – LS +1
 3 sigma = 99.73% 𝑆𝑢𝑚 𝑜𝑓 𝑡𝑕𝑒 𝑁𝑢𝑚𝑏𝑒𝑟𝑠
 6 sigma = 99.99% 𝑁𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 𝐼𝑡𝑒𝑚𝑠  Total Float = LS – ES EF – Early Finish
OR ES – Early Start
 Median = Arrange all the LF – Late Finish
 Control Limits = 3 sigma from mean  Total Float = LF – EF LS – Late Start
 Control Specifications = Defined by customer
values in order and pick the
middle number. In case of
 Rough Order of Magnitude(ROM) estimate =  Free Float(FF) =
two middle number, take
-25% to +75% mean of two numbers. ES of following – ES of Present – DUR of
 Preliminary estimate = -15% to + 50% Present
 Budget estimate = -10% to +25%  Mode = Most occurring
 Definitive estimate = -5% to +10% number in dataset  EF = ES + Duration -1
 Final estimate = 0%  LF = LS + Duration -1

 Float on the critical path = 0 days  ES = EF of Predecessor + 1

 Pareto Diagram = 80/20  LS = LF – Duration + 1

 Crashing a project = Crash least expensive

tasks on critical path PERT(Program Evaluation and Review Technique)
𝑃 + 4𝑀+ 𝑂
 Time a Project Manager spends  Expected Activity Duration(EAD) =
6 P – Pessimistic Value
communicating = 90% 𝑃 −𝑂 M – Most Optimistic Value
 Standard Deviation =
6 O – Optimistic Value
𝑃 −𝑂
 Variance of an activity = * +2
6
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