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The FITCO Manufacturing company operations manager is looking at some data to make some determinations regarding how the company is performing and some changes that
The FITCO Manufacturing company operations manager is looking at some data to make some determinations regarding how the company is performing and some changes that might need to be made. As his primary assistant, he has asked you to provide him with answers to some questions that he has. a. FITCO's factory is designed so that it is most efficient (average unit cost is minimized) when producing 15,000 units of output each month. However, it has an absolute maximum output capacity of 17,250 units per month and can produce as little as 7,000 units per month without the customer shifting production to another company. If the factory produces 10,925 units in October, what is the capacity utilization rate in October for this factory? Capacity Utilization Rate = Capacity Used : Best Operating Level b. FITCO has a job applicant being tested for an assembly line position. Management feels that steady state times have been approximately reached after 1,000 performances. Regular assembly line workers are expected to perform the task within four minutes. If the job applicant performed the first test operation in 10 minutes and the second one in 9 minutes, should this applicant be hired? Why or why not? Where x - task performance count yx number of minutes to perform the task the xth time k - number of minutes to perform the task the first time n = log b/log2, where b learning curve percentage (e.g. 0.8 for 80%)
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