Learning curve concept plays vital role in location decision, Operation Management

Assignment Help:

This assignment is designed to demonstrate that the learning curve concept plays a vital strategic role in location decision.

A company started making a new product simultaneously in a domestic plant and in an offshore plant.

For the domestic plant:

An assembly took 2.5 hours for the first unit and 18.50 hours for the first 20 units. The labor rate is $35 per hour.

For the offshore plant:

The first unit took the same time (2.5 hours) and the learning rate is found to be 85%.  The labor rate is $15 per hour (less than half of the domestic plant!!)

Find the learning rate for the domestic plant.

Find the time required and unit cost for the 1st, 10th, 20th and 22nd units respectively for each of the two plants.

Comment on what you observe in the relative unit labor costs.

Now, find the unit number at which even the cumulative cost (counting from the first unit) in the offshore plant is higher than that in the domestic plant.


Related Discussions:- Learning curve concept plays vital role in location decision

Compute what is its cost of common equity, The earnings, dividends, and com...

The earnings, dividends, and common stock price of Carpetto Technologies Inc. are expected to grow at 8% per year in the future. Carpetto's common stock sells for $27.75 per share,

Explain goals should be articulated by teams, Clearly-defined goals are the...

Clearly-defined goals are the essence of great teamwork. Which of the following statements is most true about how goals should be articulated by teams

Describe wholesale pricing, What provision of the Telecommunications Act of...

What provision of the Telecommunications Act of 1996 prohibits ILECs from requiring customers to dial an extra digit when calling someone who subscribes to a competitor's local pho

Describe the relatively poor recent record for unions, What do you think ex...

What do you think explains the relatively poor recent record for unions attempting to organize large bargaining units?

Describe major options for appraisal of employees, What are the major optio...

What are the major options for appraisal of employees? Discuss each option, identifying the one that you think is "Best", and why you chose that option

Normal time, a time study was made of a punch press operator. the average o...

a time study was made of a punch press operator. the average observed time after discounting non normal occurrence was 0.52 minutes per unit. the operator performance was judged to

Explain overall balloonong of information available free, Think back to a t...

Think back to a time when you wondered about a practice or structure within an organization. If you cannot remember such a situation from your own work history, you may write about

Explain optimal number of bookcases are produced, Question: S&V Industries ...

Question: S&V Industries manufactures book cases. Different sizes of cases are kept in inventory. The company has 80 man-hours and 36 pounds of wood available each day. 2 pounds of

Explain actual and forcasted demand level, The following are monthly actual...

The following are monthly actual and forcasted demand level for may through December for units of product manufactured by N. Month Actual demand Forecast demand May 100 102

Write Your Message!

Captcha
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