Which machine would have the lowest total cost

Assignment Help Operation Management
Reference no: EM13914382

A manager must decide which type of machine to buy, A, B, or C. Machine costs are as follows:
Machine Cost
A ......... $ 40,000
B ......... $ 30,000
C ......... $ 80,000
Product forecasts and processing times on the machines are as follows:
a. Assume that only purchasing costs are being considered. Which machine would have the lowest total cost, and how many of that machine would be needed? Machines operate 10 hours a day, 250 days a year.
b. Consider this additional information: The machines differ in terms of hourly operating costs: The A machines have an hourly operating cost of $ 10 each, B machines have an hourly operating cost of $ 11 each, and C machines have an hourly operating cost of $ 12 each. Which alternative would be selected, and how many machines, in order to minimize total cost while satisfying capacity processing requirements?

Reference no: EM13914382

Questions Cloud

What is the capacity of this system : What is the capacity of this system If the capacity of one operation could be increased in order to increase the output of the system, which operation should it be, and what amount ofincrease?
Which action would yield the greatest increase : Which action would yield the greatest increase in process capacity: (1) increase the capacity of Operation 1 by 15 percent; (2) increase the capacity of Operation 2 by 10 percent; or (3) increase the capacity of Operation 3 by 10 percent?
Would you recommend one or two lines : The manager projects an average demand of between 14 and 18 cars an hour. Would you recommend one or two lines? The car wash is open 300 hours a month.
The manager has narrowed the decision to two alternatives : A manager must decide how many machines of a certain type to buy. The machines will be used to manufacture a new gear for which there is increased demand. The manager has narrowed the decision to two alternatives.
Which machine would have the lowest total cost : Assume that only purchasing costs are being considered. Which machine would have the lowest total cost, and how many of that machine would be needed? Machines operate 10 hours a day, 250 days a year.
Which type of machine would be chosen : With high certainty of annual demand, which type of machine would be chosen if that was an important consideration? With low certainty, which type of machine would be chosen?
Determine the range for which each alternative is best : If the manager anticipates an annual volume of 10,000 units, which alternative would be best from a cost standpoint? For 20,000 units, which alternative would be best?Determine the range for which each alternative is best. Are there any alternative..
Which each of the alternatives would be best : Determine the range of annual volume for which each of the alternatives would be best.
Prepare a graph that shows total monthly cost : Prepare a graph that shows total monthly cost for each plan versus daytime call minutes. If the agent will use the service for daytime calls, over what range of call minutes will each plan be optimal?

Reviews

Write a Review

 

Operation Management Questions & Answers

  The last stage in the new-product development process

The last stage in the new-product development process is ________.

  Find the reorder point necessary to provide a 95 percent

The annual demand for a product is 14,200 units. The weekly demand is 273 units with a standard deviation of 95 units. The cost to place an order is $32.00, and the time from ordering to receipt is four weeks. The annual inventory carrying cost is..

  How eco-efficiency can be implemented on an individual

Explain, with an example, how eco-efficiency can be implemented on an individual and a business scale.

  Prepare a plan for art hill that gets the firm back

Prepare a plan for Art Hill that gets the firm back on a course toward improved profitability. Be sure to identify the symptoms, the problems, and the specific changes you would implement.

  Analyze and rank the sources with regard to reliability

Using the Web and other venues of your choice, identify three to four sources of information for trend data about the subject you chose in Step 2. Analyze and rank the sources with regard to (1) Reliability, (2) Believability, (3) Pertinence to yo..

  What type of care patients

Should Hospitals Be Allowed to Use Credit Scores in Determining What Type of Care Patients Receive?

  Relationship between organizational structure and controls

The business firm is no longer just a place where people come to work. For most of the employees, the firm confers on them that sense of belonging and identity-the firm has become their "village", their community.

  Compute the past growth rate in earnings

The Bouchard Company's EPS was $6.96 in 2005, up from $3.34 in 2000. The company pays out 50% of its earnings as dividends, and its common stock sells for $40.

  Product life cycle affect outsourcing decision of a product

How would the product life cycle affect the outsourcing decision of a product? Please have a discussion of no less than 100 words. In your own words

  Step for developing benchmarks

Which of the following is NOT a step for developing benchmarks?

  What is a proposed policy to prevent corporate ethics lapses

what is a proposed policy to prevent corporate ethics lapses that may help strengthen corporate policy?

  Describe a specific change initiative

Discuss the following points regarding change efforts and their results: Describe a specific change initiative that you participated in that seemed to work well.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd