A bicycle component manufacturer produces hubs for bike wheels. Two processes are possible for manufacturing, and the parameters of each process are as follows: Process 1 Process 2 Production Rate 35 parts per hour 15 parts per hour Daily production time 4 hours per day 7 hours per day Percent of Parts Rejected 20% 9% Assume that the daily demand for hubs allows all defect-free items to be sold. Additionally, defective hubs cannot be sold and their material cannot be recovered anymore. Find the process that minimizes the total cost per piece if each part is made from $4 worth of material. Both processes are fully automated, and the variable overhead cost is charges at $40 per hour.
A bicycle component manufacturer produces hubs for bike wheels. Two processes are possible for manufacturing, and the parameters of each process are as follows: Process 1 Process 2 Production Rate 35 parts per hour 15 parts per hour Daily production time 4 hours per day 7 hours per day Percent of Parts Rejected 20% 9% Assume that the daily demand for hubs allows all defect-free items to be sold. Additionally, defective hubs cannot be sold and their material cannot be recovered anymore. Find the process that minimizes the total cost per piece if each part is made from $4 worth of material. Both processes are fully automated, and the variable overhead cost is charges at $40 per hour.
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter10: Introduction To Simulation Modeling
Section: Chapter Questions
Problem 41P: At the beginning of each week, a machine is in one of four conditions: 1 = excellent; 2 = good; 3 =...
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A bicycle component manufacturer produces hubs for bike wheels. Two processes are possible for
manufacturing, and the parameters of each process are as follows:
| Process 1 | Process 2 | |
| Production Rate | 35 parts per hour | 15 parts per hour |
| Daily production time | 4 hours per day | 7 hours per day |
| Percent of Parts Rejected | 20% | 9% |
Assume that the daily demand for hubs allows all defect-free items to be sold. Additionally, defective hubs cannot be sold and their material cannot be recovered anymore. Find the process that minimizes the total cost per piece if each part is made from $4 worth of material. Both processes are fully automated, and the variable overhead cost is charges at $40 per hour.
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