Q2kAudi is considering three locations A, B and C for the production of its new model SUVXL500. The objective is to choose the location with the lowest costs. The costs aremeasured as annual fixed costs plus the variable costs of the product. The followingdata has been collected for the three locations.<RegionFixed costs per yearABC10 000 00020 000 00025 000 000Variable cost per unit1. at what level of production will C be the best choice?2. at what production rate will A be the best choice?3. at what level of production will B be the best choice?25002000<1000<The company's projected annual production in the new plant is 0-60 000 units.<Ask

Total cost crossover point will helps to identify the suitable level production units. A crossover…

Answered: Audi is considering three locations A,…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

See similar textbooks

Similar questions

Q4: Bluestar TV Cable company is in the process of providing cable services to five new housing development areas. Figure depicts possible TV linkages among the five areas. The cable miles are shown in each arc. Determine the most economical cable network by also providing a linear programming formulation. 3 miles 9 10 6 5
Location Fixed Cost Variable Cost A $100,000 $10 B $150,000 $7 C $200,000 $5 600 Annual 500 Cost ($000) 400 300 200 100 2 4 6 8 10 14 16 18 20 Q (000s of units) i. Plot the total cost curves in the chart provided above and identify the range over which each location would be best. ii. Use break-even analysis to calculate exactly the break-even quantity that defines each range.
ABC Ltd. Wants to choose the best location for its new aluminum plant. The manager ofproductions and operations has three possible locations to choose from. His assistantrecommends that he use break-even analysis location technique to help determine whichlocation is best based on costs. Assuming: Total fixed cost = 80,000 Price per unit= 20 AVC (Average variable cost) = 40 Break-even point= Total fixed cost / (AVC-Price per unit) Break-even point = 80,000/ (40-20) Break-even point = 4,000 1) Demonstrate to the OM manager how to go about choosing the best location using thenumerical example designed above.
Populate the relevant data Is any alternative never preferred? Complete a numeric locational cost-volume Indicate over what range each of the alternatives A, B, C is the low-cost choice Costs A B C Fixed ($) 2,500,000 2,000,000 3,500,000 Variable ($ per unit) 20+6 23+6 15+6
Explain the a ssumptions behind the center-of-gravity method. How can the model be used in a service facility location?
Dennison Manufacturing makes large helical springs used inaircraft landing gear. The company has narrowed its potentialchoices for its new manufacturing facility to four cities. Thefollowing information is known about the manufacturing andshipping costs of locating in each of these four cities: a. Use break-even point analysis to determine where Den-nison should locate.b. Based solely on break-even quantity, if Dennison’s manu-facturing forecast for the foreseeable future is 40,000 unitsannually, where should he locate?
Fruit Centre Ice Cream Parlor is deciding where to locate a new facility. The annual fixed costs, initial fixed costs and variable costs for each site have been estimated as follows; Location Annual Fixed Costs (shs) Initial Fixed costs selling price (shs) Variable costs(shs) Namugongo 35,000 400,000 200/unit 200/unit Kireka 19,000 250,000 400/unit 45/unit Banda 15,000 200,000 600/unit 2500/unit Ntinda 95,000 170,000 100/unit 360/unit If demand is expected to be 2000 units, which location is best? and Forecasting is a key component in operations management. Identify and describe any three methods of forecasting that you would recommend to a service industry.
Q4/ Consider building a new manufacturing plant, is to be located in London. For the three potential sites (location factor, weights, and scores 1 = poor, 7 = excellent') shown in table below. What is the weighted score for these sites? Which is the best location? SI. No. Location factor Weight Scores Location 1 Location 2 Location 3 Facility utilization Total patient km per month Average time per emergency trip Land and construction costs 1. 30 3 6. 7 2. 33 5 3. 27 3 1 9 4. 13 7 6. 5. Employee preferences 10 3
Carol Latta is visiting hotels in Los Angeles to decide where to hold a convention for a national organization of college business school teachers she represents. There are three hotels from which to choose—the Cheraton, the Milton, and the Harriott. The criteria she is to use to make her selection are ambiance, location (based on safety and walking distance to attractions and restaurants), and cost to the organization. Following are the pairwise comparisons she has developed that indicate her preference for each hotel for each criterion and her pairwise comparisons for the criteria: Develop an overall ranking of the three hotels, using AHP, to help Carol Latta decide where to hold the meeting.
Q3b) Ghana Post has established various truck and air routes around the country over which it ships parcels. The holiday season is approaching, which means a dramatic increase in the number of packages that will be sent. The service wants to know the maximum flow of packages it can accommodate (in tons) from station 1 to station 6. The network of routes and the flow capacities (in tons of packages per day) along each route are shown in the following network: 1 ∞ 10 5 2 3 3 6 4 4 5 0 9 nter 0 5 0 6 6 You are to determine the maximum tonnage of packages that can be transported per day from station 1 to station 6 and indicate the flow along each branch + 00 0
During a major expansion in 2004, Douwalla’s Import Company developed a new processing line for which the delivered equipment cost was $1.75 million. This year, the board of directors decided to expand into new markets and expects to build the current version of the same line. Estimate the cost if the following factors are applicable: construction cost factor is 0.20, installation cost factor is 0.50, indirect cost factor applied against equipment is 0.25, and the total plant cost index has risen from 2509 to 3713 over the years.
ABC Wants to choose the best location for its new aluminium plant. The manager of productions and operations has three possible locations to choose from. His assistant recommends that he use break-even analysis location technique to help determine which location is best based on costs. Design a numerical example in order to demonstrate to the Productions and Operations Manager how break-even analysis can be used in this Demonstrate to the OM manager how to go about choosing the best location using the numerical example you designed

SEE MORE QUESTIONS

Recommended textbooks for you

Practical Management Science

Operations Management

ISBN:

9781337406659

Author:

WINSTON, Wayne L.

Publisher:

Cengage,

Operations Management

ISBN:

9781259667473

Author:

William J Stevenson

Publisher:

McGraw-Hill Education

Operations and Supply Chain Management (Mcgraw-hi…

Operations Management

ISBN:

9781259666100

Author:

F. Robert Jacobs, Richard B Chase

Publisher:

McGraw-Hill Education

Practical Management Science

Operations Management

ISBN:

9781337406659

Author:

WINSTON, Wayne L.

Publisher:

Cengage,

Operations Management

ISBN:

9781259667473

Author:

William J Stevenson

Publisher:

McGraw-Hill Education

Operations and Supply Chain Management (Mcgraw-hi…

Operations Management

ISBN:

9781259666100

Author:

F. Robert Jacobs, Richard B Chase

Publisher:

McGraw-Hill Education

Business in Action

Operations Management

ISBN:

9780135198100

Author:

BOVEE

Publisher:

PEARSON CO

Purchasing and Supply Chain Management

Operations Management

ISBN:

9781285869681

Author:

Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson

Publisher:

Cengage Learning

Production and Operations Analysis, Seventh Editi…

Operations Management

ISBN:

9781478623069

Author:

Steven Nahmias, Tava Lennon Olsen

Publisher:

Waveland Press, Inc.

SEE MORE TEXTBOOKS