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a) What is the required input to meet demand? b) Assume that the scrap cost is SR5 at process 1, SR10 at process 2, and SR15 at process 3. Compute the total scrap cost for the given system and the system where the scrap rates were reversed (7%, 5%, and 3%). Which system would be preferred? Show calculation to support your answer. c) Assume each process is capable of rework. Given the information in the following table, what is the input required to satisfy the demand? Process Defective Rate 1 2 3 3% 5% 7% Rework Rate 60% 75% 80%

a) What is the required input to meet demand? b) Assume that the scrap cost is SR5 at process 1, SR10 at process 2, and SR15 at process 3. Compute the total scrap cost for the given system and the system where the scrap rates were reversed (7%, 5%, and 3%). Which system would be preferred? Show calculation to support your answer. c) Assume each process is capable of rework. Given the information in the following table, what is the input required to satisfy the demand? Process Defective Rate 1 2 3 3% 5% 7% Rework Rate 60% 75% 80%

Practical Management Science
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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7. Consider a simple three-step manufacturing process as illustrated in the figure below with defective rates 3%, 5%, and 7% respectively. Assuming that demand is 1,000 units d1=3% 1 d2=5% 2 d3=7% 3% 5% 7% 3 Scrap a) What is the required input to meet demand? b) Assume that the scrap cost is SR5 at process 1, SR10 at process 2, and SR15 at process 3. Compute the total scrap cost for the given system and the system where the scrap rates were reversed (7%, 5%, and 3%). Which system would be preferred? Show calculation to support your answer. c) Assume each process is capable of rework. Given the information in the following table, what is the input required to satisfy the demand? Process Defective Rate 1 2 Rework Rate 60% 75% 80%
Transcribed Image Text:7. Consider a simple three-step manufacturing process as illustrated in the figure below with defective rates 3%, 5%, and 7% respectively. Assuming that demand is 1,000 units d1=3% 1 d2=5% 2 d3=7% 3% 5% 7% 3 Scrap a) What is the required input to meet demand? b) Assume that the scrap cost is SR5 at process 1, SR10 at process 2, and SR15 at process 3. Compute the total scrap cost for the given system and the system where the scrap rates were reversed (7%, 5%, and 3%). Which system would be preferred? Show calculation to support your answer. c) Assume each process is capable of rework. Given the information in the following table, what is the input required to satisfy the demand? Process Defective Rate 1 2 Rework Rate 60% 75% 80%
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