Final answer:
The project's earned value is $87,750, the costs-to-date are $110,000, and the budget is $195,000. Since the costs exceed the earned value, the project is over budget. We cannot determine if it's ahead or behind schedule without the planned value.
Step-by-step explanation:
The status of the project can be determined using the information provided, which is Earned Value Management (EVM). The earned value of the project is $87,750. This is the value of the work actually completed. The actual costs or costs-to-date are $110,000, which is the total amount that has been spent on the project so far. The budget at completion (BAC) is $195,000, which is the total amount budgeted for the project.
By comparing the earned value to the costs-to-date, we can determine if the project is over budget or not. Since the costs-to-date ($110,000) are greater than the earned value ($87,750), the project is over budget. There isn't enough information to determine if the project is ahead or behind schedule without the planned value (PV) at this point in time.
Therefore, based on the information provided, the project appears to be over budget; thus, option 2 is the correct answer.