Calculate its effective output and capacity utilization

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Reference no: EM132155952

Answer all three of the following Roman Numeral Questions (I, II, III). Equal credit.

I. Suppose a company has a design maximum output of 200. Its actual output is 150 and its efficiency is 75%. Calculate its effective output and its capacity utilization.

II. Suppose a company has a fixed cost of $200,000 and a variable cost per unit of $14. It sells its product for $19.

a. Calculate its break-even level of output.

b. Calculate how much it must produce to make $100,000, assuming it can sell it all. Extra credit – 15 points. If it can outsource, and buy the product wholesale from a distributor at $16 each, over what level of output should it buy from the wholesaler, and over what level should it produce on its own?

III. If a company knows that its new employees have a seventy-five percent learning rate, and the first time they perform the task it takes 200 hours.

a. How long will it take to perform the eighth repetition?

b. How long will it take to perform the first eigth repetitions, cumulative?

Reference no: EM132155952

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