Practice Assessment 1 - Task 5 di

Becca270100

Does anyone have any clue how they worked out the answers to part di in Task 5 of the AMAC practice assessment 1? Any help would be appreciated!!

kstephens

Scarce resource is still labour Soft uses 3 hours per unit Medium uses 2 hours Firm uses 2.5 hours
The additional cost if bought in is Soft £6 (buy-in 55 less Variable cost if made in house is 49) Medium is £6 (54 - 48) and Firm is £5.50 (56 -50.50) Therefore additional cost per scarce resource is Soft £6/3hours = £2 Medium is £6/2hours = £3 and Firm is £5.50/2.5hours= £2.20 Therefore buy-in Soft (lowest additional cost per scarce resource to buy in)