- The mean number of air conditioning units assembled per month by Freeze, Inc. is 750 and the standard deviation is 100 unit E the number of air conditioning units assembled per month follows a normal distribution, calculate the probability of Freeze, In assemble a quantity of air conditioning units greater than the monthly break-even point calculated in problem 3-a. An improved assembling process is proposed to Freeze, Inc. to reduce the variable cost from $500 per unit to $400 per unit. rease the mean number of air conditioning units assembled per month from 750 to 850 and reduce the standard deviation to 90 its. As a result of the improvements, monthly fixed costs would go up from $250,000 to $300,000. Once these improvements are plemented, calculate the new number of air conditioning units that Freeze Inc. must sell every month to break-even, discuss and stify if you would recommend the process improvement initiative. If the number of air conditioning units assembled per month still follows a normal distribution after the implementation of the mprovements described on item (b), calculate the probability of Freeze, Inc. to assemble a quantity of air conditioning units greater nan the new monthly break-even point. Now that you know this probability, would you change your recommendation? lurtifiu

Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter12: Queueing Models
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#4- The mean number of air conditioning units assembled per month by Freeze, Inc. is 750 and the standard deviation is 100 units.
a. If the number of air conditioning units assembled per month follows a normal distribution, calculate the probability of Freeze, Inc
to assemble a quantity of air conditioning units greater than the monthly break-even point calculated in problem 3-a.
b. An improved assembling process is proposed to Freeze, Inc. to reduce the variable cost from $500 per unit to $400 per unit.,
increase the mean number of air conditioning units assembled per month from 750 to 850 and reduce the standard deviation to 90
units. As a result of the improvements, monthly fixed costs would go up from $250,000 to $300,000. Once these improvements are
implemented, calculate the new number of air conditioning units that Freeze Inc. must sell every month to break-even, discuss and
justify if you would recommend the process improvement initiative.
c. If the number of air conditioning units assembled per month still follows a normal distribution after the implementation of the
improvements described on item (b), calculate the probability of Freeze, Inc. to assemble a quantity of air conditioning units greater
than the new monthly break-even point. Now that you know this probability, would you change your recommendation? Justify.
Transcribed Image Text:#4- The mean number of air conditioning units assembled per month by Freeze, Inc. is 750 and the standard deviation is 100 units. a. If the number of air conditioning units assembled per month follows a normal distribution, calculate the probability of Freeze, Inc to assemble a quantity of air conditioning units greater than the monthly break-even point calculated in problem 3-a. b. An improved assembling process is proposed to Freeze, Inc. to reduce the variable cost from $500 per unit to $400 per unit., increase the mean number of air conditioning units assembled per month from 750 to 850 and reduce the standard deviation to 90 units. As a result of the improvements, monthly fixed costs would go up from $250,000 to $300,000. Once these improvements are implemented, calculate the new number of air conditioning units that Freeze Inc. must sell every month to break-even, discuss and justify if you would recommend the process improvement initiative. c. If the number of air conditioning units assembled per month still follows a normal distribution after the implementation of the improvements described on item (b), calculate the probability of Freeze, Inc. to assemble a quantity of air conditioning units greater than the new monthly break-even point. Now that you know this probability, would you change your recommendation? Justify.
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