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After the acquisition of the Dongle Company, the project portfolio was reviewed. During the review it was noted that the Cost Performance index looks like the following: .8, .5, .75, .7, .9, 1.35 1.2, .7, 1.4, and .8. If their policy is to cut any projects underperforming or above planned cost; what percentage of projects will be cut?
30% of the portfolio will be cut
60% of the portfolio will be cut
75% of the portfolio will be cut.
70% of portfolio will be cut
Let's first look at the definition of Cost Performance Index; A value >1 shows under planned cost, a value<1.0 is over planned cost, and a value=1.0 is on planned cost. The number of Projects>1.0 and at 1.0 is 3 while the Projects <1.0 is 7. The total number of projects that will be cut is 7/10=70%
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