Reference no: EM131275515
Capacity Decisions & Profit maximization.
Kate Smith, a chief executive officer (CEO) of a small pharmaceutical company that manufactures generic aspirin wanting the company to maximize its profits. She can sell as many aspirins as She make at the prevailing market price. She has only one manufacturing plant, which is the constraint. The plant works at full capacity 6 days a week, but she closes the plant on Sunday because on Sundays she would have to pay workers overtime rates and it is not worth it. The marginal costs are constant in the 6 days operations, only because labor costs are higher.
Now Kate obtain a long-term contract to manufacture a brand-name aspirin. The costs of making the generic aspirin or the brand-name aspirin are identical. In fact there is no cost or time involved in switching from the manufacture of on to the other. She will make much larger profits form the brand-name aspirin but the demand is limited. One day of manufacturing each week will permit you to fill the contract. She can manufacture both the brand-name and generic aspirin. Compared with the situation before you obtained the contract, your profits will be much higher if you begin to manufacture on Sundays (even if she has to pay overtime wages)
Generic aspirin. Each day she can make 1,000 cases of generic aspirin. she can sell as many as she make, for the market price of $10/case. Every week she has a fixed cost of $5,000 (land tax and insurance). No matter how many cased she manufacture, the cost of materials and supplies is $2 per case; the cost of labor is $5 per case, except on Sundays, when it is $10 per case.
Brand-name aspirin. she order for the brand-name aspirin requires that she manufactures 1,000 cases per week, which she sells for $30/case. The cost for the band-name aspirin is identical to the generic aspirin.
What do you think Kate should do?
|
Overall strategy of tesla at the corporate level
: Of the potential strategies, propose one strategy that you would recommend to TESLA's board of directors. Identify the internal strengths that substantiate your recommendation. If there are weaknesses to be overcome, propose a viable set of actions t..
|
|
Appropriate resources and capabilities to execute strategy
: Identify at least two potential business-level strategies that TESLA might employ to address its strategic issue. Substantiate each potential strategy with the facts and analysis. In particular, make sure that TESLA has the appropriate resources and ..
|
|
The average number of customers waiting in the line
: Renuka? Jain's Car Wash takes a constant time of 4.0 minutes in its automated car wash cycle. Autos arrive following a Poisson distribution at the rate of 9 per hour. Renuka wants to? know: The average wait time in the line = ___ minutes. The average..
|
|
Fully functioning groups are characterized by
: Time tested practices for developing successful teams are: Fully functioning groups are characterized by: Warren Bennis identifies four principles of effective leadership. These include all but one of the following:
|
|
Capacity decisions and profit maximization
: Kate Smith, a chief executive officer (CEO) of a small pharmaceutical company that manufactures generic aspirin wanting the company to maximize its profits. She can sell as many aspirins as She make at the prevailing market price. She has only one ma..
|
|
Group member roles that reduce group success
: Peter Drucker identifies responsibilities of leaders to be all but one of the following: All of the following are important questions to ask during team building exercises except: Group member roles that reduce group success are:
|
|
Normal probability distribution with mean bid
: Butler Company is preparing a bid on a new construction project. Two other contractors will be submitting bids for the same project. Based on past bidding practices, bids from other contractors can be described by the following probability distributi..
|
|
High environmental impacts during particular life cycle
: For each life stage, identify a product or service that has high environmental impacts during the particular life cycle stage. Then, suggest a new or existing product or service that provides the same functionality with lower (or without any) environ..
|
|
Using lists-bullets and category headings
: Revise the following poorly written sentences and paragraphs using lists, bullets, and category headings, if appropriate. Improve parallel construction and reduce wordiness. Revise the following by incorporating a bulleted list with category headings..
|