Operations Management: Processes and Supply Chains, Student Value Edition Plus MyLab Operations Management with Pearson eText -- Access Card Package (11th Edition)
11th Edition
ISBN: 9780134111056
Author: Lee J. Krajewski, Manoj K. Malhotra, Larry P. Ritzman
Publisher: PEARSON
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Question
Chapter 13, Problem 7P
A
Summary Introduction
Interpretation: The location of construction of Phoenix metropolitan market should be determined.
Concept Introduction: Plant location means to choice the particular region for setting up a business. Choosing a place for plant is most essential in order to get maximum profit. So it is very crucial to identify an ideal place, where all the capital is brought together for progress of business.
B
Summary Introduction
Interpretation: The new location for Oscar closes to his new facility should be determined.
Concept Introduction: Plant location means to choice the particular region for setting up a business. Choosing a place for plant is most essential in order to get maximum profit. So it is very crucial to identify an ideal place, where all the capital is brought together for progress of business.
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Debra began looking for physical locations that would fit with the theme of her online boutique while also having low overhead to
maintain profitability and the competitive low prices for which her business has become known. Debra should consider..........
Select one:
O a. a location in an industrial district.
O b. a small complex in a downtown shopping area.
O c. a beachfront villa that has been transformed into a store.
O d. a warehouse with plenty storage space.
A firm that recently experienced an enormous growth rate is seeking to lease a small plant in Memphis, TN; Biloxi MS; or Birmingham, AL. Prepare an economic analysis of the three locations giving the following information. Annual costs for building, equipment, and administration would be $64,000 for Memphis, $74,000 for Biloxi, and $109,000 for Birmingham. Labor and materials are expected to be $7 per unit in Memphis, $6 per unit in Biloxi, and $6 per unit in Birmingham. The Memphis location would increase system transportation costs by $63,000 per year, the Biloxi location by $73,500 per year, and the Birmingham location by $25,900 per year. Expected annual volume is 14,900 units.
Total Cost
Memphis _______________
Biloxi _______________
Birmingham _________________
Peter Billington Stereo, Inc., supplies car radios to auto manufacturers and is going to open a new plant. The company is undecided between Detroit and Dallas as the site. The fixed costs in Dallas are lower due to cheaper
land costs, but the variable costs in Dallas are higher because shipping distances would increase.
Dallas
$600,000
$27/radio
Detroit
$840,000
$21/radio
a) Based on the analysis of the volume, after rounding the numbers to the nearest whole number, Dallas is best below and Detroit is best above 40,000
b) Dallas's fixed costs have increased by 10%. Based on the analysis of the volume, after rounding the numbers to the nearest whole number, Dallas is best below and Detroit is best above
Fixed costs
Variable costs
radios
radios
Chapter 13 Solutions
Operations Management: Processes and Supply Chains, Student Value Edition Plus MyLab Operations Management with Pearson eText -- Access Card Package (11th Edition)
Ch. 13 - Prob. 1DQCh. 13 - Prob. 2DQCh. 13 - Prob. 3DQCh. 13 - Prob. 1PCh. 13 - Prob. 2PCh. 13 - Prob. 3PCh. 13 - Prob. 4PCh. 13 - Prob. 5PCh. 13 - Prob. 6PCh. 13 - Prob. 7P
Ch. 13 - Prob. 8PCh. 13 - Prob. 9PCh. 13 - Prob. 10PCh. 13 - Prob. 11PCh. 13 - Prob. 12PCh. 13 - Prob. 13PCh. 13 - Prob. 14PCh. 13 - Prob. 15PCh. 13 - Prob. 16PCh. 13 - Prob. 17PCh. 13 - Prob. 18PCh. 13 - Prob. 19PCh. 13 - Prob. 20PCh. 13 - Prob. 21PCh. 13 - Prob. 22PCh. 13 - Prob. 23PCh. 13 - Prob. 24PCh. 13 - Prob. 1AMECh. 13 - Prob. 2AMECh. 13 - Prob. 3AMECh. 13 - Prob. 4AMECh. 13 - Prob. 1VCCh. 13 - Prob. 2VCCh. 13 - Prob. 3VC
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- A manufacturer must choose between locating in Dallas (fixed cost of $60,000 / year and variable cost of $28 per unit) or Denver (fixed cost of $80,000 / year and variable cost of $22 per unit. Revenue per unit is $35 in either location. The expected demand is 20,000 units in Dallas and 15,000 units in Denver. ___________ 3a) Which location would produce the greater profit? ___________ 3b) How much is that profit?arrow_forwardDevelop a network showing the origin nodes, destinations, arcs, cost per arc, supply, and demand. Match the correct answer to each question. Warehouse A B C D City E City F City G City H Warehouse Supply. 0.51 0.21 0.52 0.41 4000 Question 1 0.31 Question 2 0.56 0.43 0.35 0.41 0.28 City Demand 4,400 3,000 6,500 4,700 Match the correct answer to the following questions: 1. What is the supply constraint for Warehouse D? 2. What demand constraint for City H? 0.32 0.54 0.33 4000 0.54 0.34 0.52 6300 6000 [Choose ] [Choose ] > >arrow_forwardLet us assume that a new medical facility, Health-care, is to be located in XYZ city. The location factors, factor rating and scores for two potential sites are shown in the following table. Which is the best location based on factor rating method? in the following table. Which is the best location based on factor rating method? Sr Location factor Factor Rating Rating Location 1 Location 2 1 Facility utilization 10 5 4 2 Total patient per month 8 4 2 3 Average time per emergency trip 5 4 5 4 Land and construction costs 6 3 4 5 Employee preferences 7 4 4 6 Operations Facility 8 4 3arrow_forward
- ABC Ltd. Wants to choose the best location for its new aluminum plant. The manager ofproductions and operations has three possible locations to choose from. His assistantrecommends that he use break-even analysis location technique to help determine whichlocation is best based on costs. . If total fixed cost = 40000 AVC = 20 Price per unit = 10 Break even point = 40000 / 20 - 10= 4000 So at the 4000 units of production, there will be no profit and loss as the total revenue is equal to the total cost. Demonstrate to the OM manager how to go about choosing the best location using thenumerical example you designed above.arrow_forwardPlease solve the attachedarrow_forwardABC Ltd. Wants to choose the best location for its new aluminum plant. The manager ofproductions and operations has three possible locations to choose from. His assistantrecommends that he use break-even analysis location technique to help determine whichlocation is best based on costs. Assuming: Total fixed cost = 80,000 Price per unit= 20 AVC (Average variable cost) = 40 Break-even point= Total fixed cost / (AVC-Price per unit) Break-even point = 80,000/ (40-20) Break-even point = 4,000 1) Demonstrate to the OM manager how to go about choosing the best location using thenumerical example designed above.arrow_forward
- 7arrow_forwardMcDonald's is about to open a new store. Three locations are under consideration, with possible outcomes (depending on demand) as shown in the table to the right. small medium large Low 45 20 -20 Demand Moderate 60 65 50 Answer the following 4 (four) questions. Using the Laplace criterion, which location is best? Using the minimax regret criterion, which location is best? Using the maximin criterion, which location is best? Using the maximax criterion, which location is best? High 75 100 150 A. large B. small C. small or medium (both are equivalent) D. medium large (both are equivalent) E. medium 분arrow_forwardPopulate the relevant data Is any alternative never preferred? Complete a numeric locational cost-volume Indicate over what range each of the alternatives A, B, C is the low-cost choice Costs A B C Fixed ($) 2,500,000 2,000,000 3,500,000 Variable ($ per unit) 20+6 23+6 15+6arrow_forward
- ← Daniel Tracy, owner of Martin Manufacturing, must expand by building a new factory. The search for a location for this factory has been narrowed to four sites: A, B, C, or D. The following table shows the results thus far obtained by Tracy by using the factor-rating method to analyze the problem. The scale used for each factor scoring is 1 through 5. Factor 1 2 3 4 6 7 Factor Description Quality of labor Construction cost Transportation costs Proximity to Markets Taxes Weather Energy costs a) Based on the given information, the best site for Daniel Tracy is D with a total weighted score of B Weight 10 7 7 8 A 6 5 A 5 3 4 2 B 2 5 3 2 5 4 Site Scores C 5 4 4 4 3 4 4 (Enter your response as an integer.) D 3 1 2 3 4 3arrow_forwardSarah is a designer, but her passion is to paint. To pursue her passion Sarah would like to have an exhibition of her art work for a week. She contacts four landlords with a proposal of renting their places for a week and to her surprise all 4 accept the idea. Characteristics of each location are as follows: Sarah wants to know if people like her paintings enough to buy them. Decision objectives:1- Space not less than 600ft2.2- Location3- Decoration4- Facilities5- Overall budget including rent for one week not to exceed $300 Which store is Sarah going to choose for her art exhibition? Explain your chain of thoughts and the process.arrow_forwardAccel Express, Inc., collected the following information on where to locate a warehouse (1 = poor, 10 = excellent): Location Score Location Factor Factor Weight A B Construction costs 10 8 5 Utilities available 10 7 7 Business services 10 4 7 Real estate cost 20 7 4 Quality of life 20 4 8 Transportation 30 7 6 a. Which location, A or B, should be chosen on the basis of the total weighted score?b. If the factors were weighted equally, would the choice change?arrow_forward
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