OPERATIONS MANAGEMENT (LL) W/CONNECT
14th Edition
ISBN: 9781265502942
Author: Stevenson
Publisher: MCG CUSTOM
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Chapter 5, Problem 11P
a)
Summary Introduction
To determine: The number of machines of each type required to handle the demand and its capacity and the machine that would have lower total cost.
Introduction: Capacity planning is the process of planning the required production output based on the requirement or the demand that is predicted.
b)
Summary Introduction
To determine: The machine that would have lower total cost considering operating cost.
Introduction: Capacity planning is the process of planning the required production output based on the requirement or the demand that is predicted.
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A manager must whether to buy machine A or B. Machine costs are as follows: A $52,000 each; B $100,000 each
Product forecast and processing times on the machines are as follows
Processing Time per unit (minutes)
Product
Annual Demand
A
B
1
8,000
2
18,000
3
10,000
Assume that only purchasing costs are being considered. Which machine would have the lowest purchase cost and how many
of that machine would be need? Machines operate 8 hours a day 250 days per year.
The machines differ in hourly operation costs. The A machines have an hourly operating cost of $12 each and B machines have
an hourly operating cost of $30 each. What is the operating cost per year and which alternative should be selected to minimize
total cost (for the first year) while satisfying the processing requirements?
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A manager must decide which type of machine to buy, A, B, or C. Machines costs are as follows:
Machine
Cost
A
$40,000
B
$30,000
C
$80,000
Product forecast, processing times on the machines, and setup times are as follows:
Processing Time Per Unit (minutes)
Product
Annual Demand
A
B
C
Setup Times (minutes)
Production Lots (units)
1
16,000
3
4
2
20
200
2
12,000
4
5
3
35
100
3
6,000
5
6
3
60
50
4
30,000
2
4
1
15
500
Machines operate 10 hours a day, 250 days a year. The manager wants to have a capacity cushion of 10%.
a. Assume that only purchasing costs are being considered. Which machines would have the lowest total cost, and how many of that machines would be needed?
b. Consider this additional information: The machines differ in terms of hourly operating costs: The A machines have an hourly operating cost of $11 each, B machines have an hourly operating cost of $10 each, and C machines have an hourly operating cost of $12 each. Which alternative would…
A manager must decide which type of machine to buy, A, B, or C. Machine costs are as follows:
Machine CostA $40,000B $30,000C $80,000Product forecasts and processing times on the machines are as follows:
Processing Time per Unit (minutes)
Product
Annual Demand
A
B
C
1
16000
3
4
2
2
12000
4
4
3
3
6000
5
6
4
4
30000
2
2
1
a.) Assume that machines operate 10 hours a day, 250 days a year. If we only consider purchasing costs, which machine would have the lowest total cost?
b.) Assume machines operate 10 hours a day, 250 days a year. If we select machine A, how many machine A do we need? (Use common sense to decide the answer.)
Chapter 5 Solutions
OPERATIONS MANAGEMENT (LL) W/CONNECT
Ch. 5.8 - Explain the meaning of the phrase Hours versus...Ch. 5.8 - Prob. 1.2RQCh. 5.8 - Prob. 1.3RQCh. 5.8 - Prob. 1.4RQCh. 5.8 - Prob. 1.5RQCh. 5.S - Prob. 1DRQCh. 5.S - Prob. 2DRQCh. 5.S - Explain the term bounded rationality.Ch. 5.S - Prob. 4DRQCh. 5.S - Prob. 5DRQ
Ch. 5.S - What information is contained in a payoff table?Ch. 5.S - Prob. 7DRQCh. 5.S - Prob. 8DRQCh. 5.S - Under what circumstances is expected monetary...Ch. 5.S - Explain or define each of these terms: a. Laplace...Ch. 5.S - Prob. 11DRQCh. 5.S - Prob. 12DRQCh. 5.S - Prob. 13DRQCh. 5.S - Prob. 1PCh. 5.S - Refer to problem1. Suppose after a certain amount...Ch. 5.S - Refer to Problems 1 and 2 Construct a graph that...Ch. 5.S - Prob. 4PCh. 5.S - Prob. 5PCh. 5.S - The lease of Theme Park, Inc., is about to expire....Ch. 5.S - Prob. 7PCh. 5.S - Prob. 8PCh. 5.S - Prob. 9PCh. 5.S - A manager must decide how many machines of a...Ch. 5.S - Prob. 11PCh. 5.S - Prob. 12PCh. 5.S - Prob. 13PCh. 5.S - Prob. 14PCh. 5.S - Give this payoff table: a. Determine the range of...Ch. 5.S - Prob. 16PCh. 5.S - Repeat all parts of problem 16, assuming the value...Ch. 5 - Prob. 1DRQCh. 5 - Prob. 2DRQCh. 5 - How do long-term and short-term capacity...Ch. 5 - Give an example of a good and a service that...Ch. 5 - Give some example of building flexibility into...Ch. 5 - Why is it important to adopt a big-picture...Ch. 5 - What is meant by capacity in chunks, and why is...Ch. 5 - Prob. 8DRQCh. 5 - How can a systems approach to capacity planning be...Ch. 5 - Prob. 10DRQCh. 5 - Why is it important to match process capabilities...Ch. 5 - Briefly discuss how uncertainty affects capacity...Ch. 5 - Prob. 13DRQCh. 5 - Prob. 14DRQCh. 5 - Prob. 15DRQCh. 5 - Prob. 16DRQCh. 5 - What is the benefit to a business organization of...Ch. 5 - Prob. 1TSCh. 5 - Prob. 2TSCh. 5 - Prob. 3TSCh. 5 - Prob. 1CTECh. 5 - Prob. 2CTECh. 5 - Identify four potential unethical actions or...Ch. 5 - Any increase in efficiency also increases...Ch. 5 - Prob. 1PCh. 5 - In a job shop, effective capacity is only 50...Ch. 5 - A producer of pottery is considering the addition...Ch. 5 - A small firm intends to increase the capacity of a...Ch. 5 - A producer of felt-tip pens has received a...Ch. 5 - A real estate agent is considering changing her...Ch. 5 - A firm plans to begin production of a new small...Ch. 5 - A manager is trying to decide whether to purchase...Ch. 5 - A company manufactures a product using two machine...Ch. 5 - A company must decide which type of machine to...Ch. 5 - Prob. 11PCh. 5 - A manager must decide how many machines of a...Ch. 5 - Prob. 13PCh. 5 - The following diagram shows a four-step process...Ch. 5 - Prob. 15PCh. 5 - Prob. 16PCh. 5 - Prob. 17PCh. 5 - Prob. 18PCh. 5 - A new machine will cost 18,000, butt result it...Ch. 5 - Remodelling an office will cost 25,000 and will...Ch. 5 - Prob. 1CQCh. 5 - Prob. 2CQCh. 5 - Prob. 3CQ
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