Reference no: EM132592388
Identify each fact situation with one of the five paths to cost cutting: technical efficiency (TE), input mix efficiency (IME), scale economies (SE), volume discounts (VD), or learning curve advantages (LCA). (Use each path no more than once).
a) Tesla Inc. has constructed the world's largest so-called giga factory for lithium ion batteries identical to those in your PC. Since each Tesla auto requires a thousand such batteries, the long-run average fixed cost associated with this massive plant as well as the total unit cost will decline over an extensive range of output. (____)
b) With only five new orders in 2015-2017, the Airbus superjumbo A380 was at a cost disadvantage because of substantially less repetition of production tasks than the Boeing 787 wide-body which received several hundred orders in 2015-2017. (____)
c) On 350-500 mile flights, Southwest Airlines achieves 30% more revenue-earning flying hours from the same size aircraft, facilities, route, and number of personnel as USAir/American. (____)
d) Lowe's Home Improvement offers half-price delivery fees on pre-built roof systems after the first dozen at a subdivision job site. Otherwise, a full $350 delivery fee per roof system applies. (____)
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