I was just a little confused in the following question could you just help me out?
Cost/kg=4 Contribution/unit= $10 New contribution/unit= $17(as a result of additional 1 unit of material) Shadow price=$7 What is the most the company should be willing to pay for the extra material?
The answer is $11 (the current cost per kg plus the shadow price).
I do explain this in my free lectures. The lectures are a complete free course for Paper PM and cover everything needed to be able to pass the exam well.