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Fred is currently managing a project that is that is significantly behind schedule, he started to calculate his estimate to completion. The following parameters were used: EAC=$500,000, AC= $750,000, and CPI not expected to be the same for remainder of project. Which is the correct ETC calculation for his project?
ETC=Re-estimate from Bottom up
ETC= (BAC/CPI) -AC
ETC =AC+BAC-EV
ETC =EAC-AC
ETC=(BAC/CPI)-AC is incorrect as BAC/CPI assumes an EAC at same rate for remainder of project which will not be accurate if you are significantly behind on schedule. ETC=AC+BAC-EV is incorrect it is the formula for EAC not ETC. ETC=EAC-AC is incorrect as this formula for ETC assumes work was on plan. ETC=Re-estimate from Bottom up is the correct answer as it shows we need to re-estimate work from bottom up since we are significantly behind. (PMBOK 2013 Rev 5th Edition, pgs 217-225).
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