APM*** ACCA P5 December 2016 Exam was.. Instant Poll and comments ***

I also got A withat 1400 demand basEd on a similar question in the bpp rev kit

Thanks Lee

Thought the questions were fair but totally messed up my time management meaning I ran out of time on my question 2 and my workings were really messy! Argh! Expecting a resit...

I also received in Q1 that maximax would be with Format A demand 1400. Maximin received to be at Format B.

Here's my maximax calculation. I think I remember the numbers correctly: Here was data given in question: Sales/unit c/s ratio Days in year Fixed Costs Project A 3.8 58% 360 900000 Project B 4 59% 360 980000 Project C 4.2 63% 360 1120000 Then the one way data table is as follows: For example for project A at 1200 demand, profit = 1200*3.8*58%*360-900000 = 52128 Project A Project B Project C 1200 52128 39520 23072 1400 210816 209440 213584 1600 369504 379360 404096 So under maximax project C is the choice giving a maximum possible profit after fixed costs of £404096 if the demand is 1600.

Yes, but you also have probability for each option and if you consider it then the results change.

@anastell said: Yes, but you also have probability for each option and if you consider it then the results change.

A maximax calculation does not use probabilities as it is a technique for dealing with uncertainty. The probabilities are for expected value analysis which is a technique for dealing with risk

@chris165 said: A maximax calculation does not use probabilities as it is a technique for dealing with uncertainty. The probabilities are for expected value analysis which is a technique for dealing with risk

Hmm - seems harsh that probabilities were given to throw us. Information is almost always given to aid us? Also, the question stated that the organisation were risk seeking, so an expected value analysis will surely be accepted (as would a MaxiMax).

@ryansm05 said: Hmm - seems harsh that probabilities were given to throw us. Information is almost always given to aid us? Also, the question stated that the organisation were risk seeking, so an expected value analysis will surely be accepted (as would a MaxiMax).

In my opinion the question required both EV and maximax. It was for 17 marks... the probabilities are used only in the EV calculations

Those that used minimax and maximax rules would be correct under uncertainty. Also just calculating the profit ignoring the probabilities would also be right as it measures uncertainty about the outcome of the options. Risk relates to using probabilities and finding the expected value of the outcome. The choice of what options to take is not straight one and it will depend on the risk profile o the person taking the decision. Since the management are optimistic, maximax rule will be appropriate. Pessimistic person will use minimax rule. Also note that the calculation of Maximax or minimax will involve using the contribution ratio ignoring the probabilities of the outcome of the levels used. Hope this helps

Mmmmm after going through all the comments on the risk question, I have realised that I did a profit table with wrong figures because I used probabilities where I was not supposed to. But can someone tell me if it is possible that I can be given some marks for demonstrating my knowledge of Maximax maximin and minimax regrets, even if figures used were wrong.

Chris165 You are very correct, you made me realise where I went wrong. What I want to know now is if I can be given some marks for demonstrating my knowledge of maximax maximin and minimax regret, even if my figures were wrong. I regret all the time wasted on all the calculations when I finally left my last question unfinished.

AVERAGE REVENUE PER CUSTOMER ORDER OR PER MEAL

Paper was not that hard but drawback of such paper time management. i would say it was easy paper.

I do hope it is not tricksy. It is okay and I wish every participants success!

@felicitanchang said: Chris165 You are very correct, you made me realise where I went wrong. What I want to know now is if I can be given some marks for demonstrating my knowledge of maximax maximin and minimax regret, even if my figures were wrong. I regret all the time wasted on all the calculations when I finally left my last question unfinished.

I would like to know this as well. I am certain my calculations were incorrect but I applied all the techniques mentioned correctly, even minimax regret! Surely acca do spply error carried forward. It's so easily done to mistype figures into a calculator under the time pressure of an exam.

@C165, kaplan used probabilities for maximax but insisted it can be used without probabilities as well

Questions were to long and time required was a limitation.

I passed, i am now an affiliate. Thanks to God