Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Optimal Capacity Determination
For a given capacity of a plant the average unit cost of production of a product decreases as the output rate( say in number of units produced per year.) in increases figure . this happens because we known that the fixed cost incurred in the plant, machinery equipment. Remains constant through changes in the volume of output. When a large number of units of the product are produced. These fixed costs get divided uniformly in the large number of units. Therefore the average cost per unit of the product decreases.When the rate of output is increased beyond a particular limit, the average unit cost start rising because of more frequent equipment breakdowns, fatigue in workers resulting in more defective items, scheduling problems inventory problems, etc. This particular limit of the output rate is called the optimum output rate, for which the average unit cost of the product is the minimum.
Figure: Optimal Capacity Determination
There is a relationship between the optimum output rate , minimum average unit cost of a product and the capacity of the plant. As shown in figure (b) for plants with small design capacity (small sized plant ) the optimum output rate is the lowest and the minimum average unit cost of product is the highest compared to medium sized and large sized plants.Thus while determining the optimal capacity of a new facility three important factors have to be kept in min. These are the demand forecast available capital and other resources, and the minimum average unit cost desired to keep the competitors at bay.
Strength and weakness of united airlines
In estimating the difference between two population means, if a 95 percent confidence interval includes zero, then we can conclude that there is a 95 percent chance that the differ
A global corporation sees the world as its labor source as well as its marketplace. Therefore, a global corporation will locate an operation wherever it can accomplish its goals in
Q. What are the inter-connect factors introduced by Cousins? Cousins introduced the following inter-connected factors to strategically affect supply chain management. The '
North West Corner Rule: Step1: The first assignment is made in the cell occupying the upper left hand ( north west ) corner of the transportation table. The maxim
whats the recommendation?
How did Jim conclude that the process was not capable based on his first set of samples? 2. Does the second set of samples show anything that the first set didn’t? Explain what an
Even though independent gasoline stations have been having a difficult time, Susan Helms has been thinking about starting her own independent gasoline station. Susan's problem is t
What do your contingency plan in case your plan of action doesn't work?
What is operations strategy? Operations strategy: According to Slack and Lewis the definition operations strategy: The total pattern of decisions that shape the long
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!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd