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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › Relevant cost (labour)
1) If labour has spare capacity
[Relevant cost = 0]
2) If labour has no spare capacity and we can hire more labour
[Relevant cost = Labour cost + overtime premium]
3) If labour has no spare capacity and we cannot hire more labour
[Relevant cost = Opportunity cost]
4) Opportunity cost is either [extra labour cost + lost contribution]
All seems correct!