Cost Performance Index
Ratio
Cost Performance Index (CPI) measures the cost efficiency of a project. A CPI below 1 suggests the project is over budget, whereas a CPI above 1 implies it's under budget. CPI aids in forecasting final project costs.
Formula
CPI = Earned Value (EV) / Actual Cost (AC)
Example
If the earned value is $50,000 and the actual cost incurred is $55,000, the CPI is 0.91.