Shadow Price made EASY | ACCA PM F5 | Cut and Stitch

🚀 Get all my PM Videos here: tinyurl.com/ACCA-PM-Help 🚀 Learn how to quickly solve a shadow price (Limiting factor) ACCA PM question. I'll take you through past exam question Cut and Stitch from the ACCA PM past exams, demonstrating an approach and the exam technique for Shadow Price that will help you get a pass. Shadow Price is a tricky topic from limiting factors and I explain it step-by-step in this video.
Good luck on your exams!
Here is the link to question Cut and Stitch: www.shorturl.at/cLOTY
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Table of Contents:
00:00 - Introduction
01:13 - Question Cut and Stitch
01:46 - Part A Explained
02:02 - Shadow Price Explainer
06:55 - Review of question scenario
08:42 - Step 1: define variables
09:03 - Step 2: define constraints
10:35 - Step 3: objective function
11:14 - Linear Programming Graph explained
13:55 - Profit maximizing production plan
14:44 - Part B: shadow price of labour
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Steve Willis ACCA
How to Pass ACCA CBE Exams
Help with Shadow Price
For more help with ACCA PM, linear programming, limiting factors, and shadow price, check out Open Tuition • Linear Programming - S... Find many other helpful videos on James Wright ACCA / jameswrightacca

[@ninetails114]

Hi steve
I know this may be off topic but.
Can an adverse/ favorable operational variance be due an adverse/ favorable planning variance?

[@SteveWillisACCA]

Hi, can't think of an example of that...COVID meant fewer customers in our hotel, planning variance. Price of natural gas up from global conflict, planning variance...if something is out of the control of the guy being assessed/appraised, it should be excluded.

[@ninetails114]

@Steve Willis ACCA but lets say in your scenario above that the planning variances were adverse.
Would you say that the poor/inaccurate forecasting of the budgeted amounts by the higher ups would likely influence the operational variances as the person who is being evaluated would have been aiming to meet that 'budgeted target' set by the higher ups?

[@SteveWillisACCA]

Not sure! From my own experience if my boss gave me un-realistic targets It wouldn't motivate me to work harder.

[@FULLMOON322]

I am curious to know if your premium can be purchased till June. I have been on the website but its only up to March

[@SteveWillisACCA]

hi, I reset it every 3 months. If you want to pay now and keep it to June, I can set that up for you, just remind me in March with an email, or in the Whatsapp Group.

[@FULLMOON322]

@@SteveWillisACCA no worries at all will do.

[@NanKKhaing]

Hi Steve
In this Case, I think like that rate for extra hour is 4.5 and normal rate is 1.5. So, the incremental cost for this extra hour is (4.5-1.5=3). But in your calculation, incremental cost for this extra hour is 0.5. Please, can you explain me?

[@SteveWillisACCA]

Hi there, I'm sorry when I made that I used a hypothetical example of workers asking for 0.50 overtime premium, not the $3.00 from the question. You are right, if I did the next part you are correct. Sorry about that!

[@NanKKhaing]

@@SteveWillisACCA Thank for your reply

[@SteveWillisACCA]

🎯To get access to all my videos with NO ADS, and to join my WhatsApp Group, click Here: videos.stevewillistraining.com
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[@ZahraAli12]

There is Question in the description but i cant find the answer?

[@SteveWillisACCA]

Just the question--I take you through the solution in the video.

[@faisalfuqraz2342]

Am unable to join your group please tell me how can i join

[@SteveWillisACCA]

hi there, go to videos.stevewillistraining.com and sign up.