The Omega Shoe Company manufactures a number of dif-ferent styles of athletic shoes. Its biggest seller is the X-Pacer running shoe. In 2008 Omega implemented a quality-management program. The company’s shoe pro-duction for the past three years and manufacturing costs are as follows. Only one-quarter of the defective shoes can be reworked, at acost of $2 apiece. Compute the manufacturing cost per goodproduct for each of the three years and indicate the annual percentage increase or decrease resulting from the quality-management program. Year 2008 2009 2010Units produced/input 32,000 34,600 35,500Manufacturing cost $278,000 291,000 305,000Percent good quality 78% 83% 90%

The Omega Shoe Company manufactures a number of dif-ferent styles of athletic shoes. Its biggest seller is the X-Pacer running shoe. In 2008 Omega implemented a quality-management program. The company’s shoe pro-duction for the past three years and manufacturing costs are as follows. Only one-quarter of the defective shoes can be reworked, at acost of $2 apiece. Compute the manufacturing cost per goodproduct for each of the three years and indicate the annual percentage increase or decrease resulting from the quality-management program. Year 2008 2009 2010Units produced/input 32,000 34,600 35,500Manufacturing cost $278,000 291,000 305,000Percent good quality 78% 83% 90%

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter9: Decision Making Under Uncertainty

Section: Chapter Questions

Problem 30P

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