1. A producer of a machine tool wants to move to a larger building and has identified 2 places. Location A has annual fixed costs of $800 thousand and variable costs of $14 thousand per unit; location...

1.    A producer of a machine tool wants to move to a larger building and has identified 2 places.  Location A has annual fixed costs of $800 thousand and variable costs of $14 thousand per unit; location B has annual fixed costs of $920 thousand and variable costs of $13 thousand per unit. The finished items sell for $17 thousand each.
a.    At what volume of output would the two locations have the same total cost?

b.    For what range of output would location A be superior? For what range would B be superior?
2.    An appliance manufacturer wants to contract with a repair shop to handle authorized repairs in Sacramento. The company has set an acceptable range of repair time of 50 minutes to 90 minutes. Two firms have submitted bids for the work. In test trials, one firm had a mean repair tome of 74 minutes with a standard deviation of 4 minutes and the other firm had a mean repair time of 72 minutes with a standard deviation of 5.1 minutes. Which firm would you choose? Why?

3.    A supplement company buys vitamin C in 25 kilogram bags. The company used 1,215 bags per year. Ordering cost is $10 per order. Annual carrying cost is $75 per bag.

a.    Determine the economic order quantity.
b.    What is the average number of bags on hand?
c.    How many orders per year will there be?
d.    Compute the total cost of ordering and carrying vitamin C.
e.    If holding costs were to increase by $9 per year, how much would that affect the minimum total annual cost?

4.    A machine cell uses 200 pounds of a certain material each day. Material is transported in vats that hold 20 pounds each. Cycle time for the vats is about 2 hours. The manager has assigned an inefficiency factor of 0.08 to the cell. The plant operates on an eight hour day. How many vats will be used?

5.    Identify and explain the four types of safety incidents in manufacturing.

6.    Define DMAIC and give explanation of each part.

7.    Provide some examples of visual controls and displays utilized in manufacturing.