# Important Formulas for the PMP Exam

Here are some formulas which may be important from the point of view of the PMP exam -

**Future value calculations:**

FV = PV(1 + i)n

**Present Value is calculated as follows:**

PV = FV / (1 + i)n

**The formula for calculating the lines of communication is as follows:**

(number of participants × (number of participants less 1)) divided by 2

* Here’s the calculation in mathematical terms:* n (n – 1) / 2

**The formula to calculate expected value is as follows:**

(optimistic + pessimistic + (4 × most likely)) ÷ 6

**The formula for standard deviation, which helps you determine confidence level, is as follows:**

(pessimistic – optimistic) ÷ 6

**Performance measurements**

Cost variance: CV = EV – AC

Schedule variance: SV = EV – PV

**Performance indexes**

Cost performance index: CPI = EV ÷ AC

Cumulative cost performance index: CPIC = EVC ÷ ACC

Schedule performance index: SPI = EV ÷ PV

**Forecasting**

Estimate to complete (cost to complete remaining work)

Based on new estimate: manual calculation by project team

ETC with typical variances: ETC = (BAC – EVC) ÷ CPIC

ETC with atypical variances: ETC = (BAC – EVC)

**Estimate at completion (expected total cost at completion)**

Using new estimate when assumptions are flawed: EAC = ACC + ETC

EAC using CPIC (typical variances): EAC = ACC + ((BAC – EV) ÷ CPIC)

EAC using remaining budget (atypical variances): EAC = ACC + BAC – EV

**Variance analysis**

Variance analysis: VAC = BAC – EAC

If you want a more comprehensive guide to PMP Formulas with detailed explanations and a pretty useful cheat-sheet, I recommend the PMP Exam Formula study guide.