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QUANTITATIVE TECHNIQUES

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › QUANTITATIVE TECHNIQUES

  • This topic has 1 reply, 2 voices, and was last updated 2 years ago by John Moffat.
Viewing 2 posts - 1 through 2 (of 2 total)
  • Author
    Posts
  • May 22, 2023 at 9:15 am #684800
    sooha
    Participant
    • Topics: 62
    • Replies: 71
    • ☆☆

    this question from kaplan Exam kit
    The time taken to produce the first batch of 50 units was 400 hours but the labour budget is
    subject to a learning effect where the learning rate is 90%. The rate of pay for labour is
    $12 per hour.
    The business had received and satisfied an order for 600 units but it has now received a
    second order for another 800 units.
    The value of b is = –0.152

    this is the answer
    Time for the first order:
    Y = axb
    Y = 400 × 12 –0.152
    Y = 274.17285 hours
    Total time = 3,290.07 hours
    Time for first 1,400 units (28 batches)
    Y = axb
    Y = 400 × 28 –0.152
    Y = 241.04158 hours
    Total time = 6,749.16 hours
    Time for second order = 6,749.16 – 3,290.07 = 3,459.09 hours
    Cost of second order = 3,459.09 × $12/hr = $41,509.08

    i don’t understand why i have to work with batch here and how should i know when i have to use them.
    why 28 batch chosen why don’t have just selected 16 batch and just subtract the result from 12 ?
    28 not even a double or something

    May 22, 2023 at 4:01 pm #684824
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54699
    • ☆☆☆☆☆

    Firstly, because the question gives the time for the first batch we do the whole question based on batches.

    (Had, instead, we been given the time for the first unit then we would have done the whole question on units, but we don’t know the time for the first unit).

    Secondly, they have already made 12 batches and the new order is for 16 batches which takes the total up to 28 batches. So we look at the difference between 28 and 16 batches.

    The fact that 28 does not involve doubling simply means that we have no choice but the use the formula to get the total for 28 batches. (16 does involves doubling and so for 16 you could either use the doubling rules or use the formula – that part of the answer would be the same either way apart from maybe rounding, which are irrelevant).

    Have you watched my free lectures on learning curves? The lectures are a complete free course for Paper PM and cover everything needed to be able to pass the exam well.

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