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“100 hours of unskilled labour currently paid at $5.5 per hour are needed for a contract. Z co. has no surplus capacity at the moment, but additional temporary staff could be hired at $6.5 per hour.”
The correct answer is: $650
Sir now my only doubt in this question is we have not been given contribution lost per direct labour hour, if it would have been less than $1 than transferring the workers would have been a better choice but if contribution lost per direct labour hour was more than $1 then hiring additional workers would’ve been a saner choice.
so how do we decided when complete information is not given?
many thanks as always!
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